141990 Case Study Solution and Analysis
141990 Case Study Help is the biggest publishing company with a greatest market share in the China's book retail market. CMP has become a specialized information service provider and a large comprehensive Science and Innovation publishing business through the integration of print media, audio-visual media and the network media.
CMP has actually invested its 60 years journey efficiently, being a successful publishing house, however, the altering macro market trends and forces bring particular challenges to the publishing market in basic and 141990 Case Study Analysis in particular. These aspects include;
• Entrance of the new publishing companies in the industry.
• Declining growth of the publishing market.
• Market saturation.
• Introduction of digital publishing techniques
• Enhancement of science and innovation.
The transformation of the macro markets have raised several questions to the management at CPM that what could be the future of CMP in this scenario? Do the long valuable experience, technical resources and the capabilities of the business could be used to strive for the future development unceasingly? How could the company sustain its long term competitive position in future?
141990 Case Study Analysis has specific strengths that can be utilized to minimize the dangers, get rid of the weakness and obtain the opportunities. Strengths of CMP are offered as follows;
• The long term experience of 141990 Case Study Analysis in the publishing market i.e. 60 years allows the company to offer high quality products at a lower cost utilizing its prior experiences.
• The technical resources and abilities created by its successful journey offer a competitive benefit to CMP.
• Vast product portfolioof CMP helps it to diversify its threat and offer high value to its customers.
• Strong financial position allows the business to think about several advancement opportunities without any worry of raising fund externally.
In addition to the strengths, the business has specific weaknesses which could increase restraints for the business in implementing its advancement program. The weaknesses of 141990 Case Study Help are given as follows;
• Despite of being a science and technology publishing firm, the business still has conventional ways ofpublishing which are not compatible with the growing technological shift.
• CMP extremely relies over the Chinese markets for its development. It must propose certain growth strategies to avoid its dependence over the Chinese markets to accomplish long term development.
Although, the development of the publishing industry is decreasing considering that 2008, affecting 141990 Case Study Solution also, however the growth might be restored by availing specific chances provided in the market. The market opportunities for CMP include;
• The company might likewise introduce Digital Publishing by utilizing its long term technical experience and a strong customer acknowledgment in the market.
• CMP could think about a development program through the growth towards foreign markets in order to lower its dependence over Chinese markets by utilizing its large financial resources.
The changing macro patterns in the market and increasing competitors in the publishing industry has presented particular threats to 141990 Case Study Help consisting of;( Gurel, 2017).
• Introduction of digital publishing i.e. virtual libraries could result in decreasing market share of 141990 Case Study Solution due to the consumer shift towards virtual libraries.
• The presence of large number of rivals in the publishing market increase the risk for CMP to lose its competitive position in the market, as competitors can acquire a strong customer base by using certain methods like aggressive promo, quality items, etc.
• Entrance of brand-new publishing firms in the market together with existence of high competitors increases the danger of losing the customer base.
The business has a rather competitive financial performance. Due to absence of data, the monetary ratios of CMP might not be calculated. However, the total monetary performance of the business could be evaluated by utilizing the charts given in the case Appendices. It might be examined from the Appendix III that the annual overall revenues of CMP throughout the period 2000-2012 are growing at a high development rate, revealing that the annual need of the products of 141990 Case Study Help is growing and the business is quite effective in drawing in a large number of consumers at a prospective rate.
Along with it, the 2nd graph which shows the annual growth in the 141990 Case Study Analysis total assets, shows that the business is rather efficient in including worth to its possessions through its revenues. The development in possessions reveals that the overall worth of the firm is also increasing with increasing the overall incomes. (Unidentified, 2013).
Another monetary analysis of the company using the given information might be the analysis relating to the distribution of total earnings of the business. Major part of the revenues of CMP comes from the sales of its published books i.e. 64% as shown in the Case Appendix V. The business could move towards other service sectors with a possible development to achieve its future development goal.
PESTEL analysis might be conducted to discover the different external forces impacting the efficiency of the business and the current trends in the external environment of the business. A quick PESTEL analysis of the business is given as follows; (Alanzi, 2018).
As the publishing sector might have a substantial effect on the state of mind of individuals about the communist ideology of the government, for that reason, the publishing sector is extremely monitored and directed by the Publicity Department of the Communist Party of China. It might be said that the overall political forces affecting CMP organisation are high. The federal government policies regarding the publishing sector are likewise increasing with the passage of time.
Economic forces affecting the publishing sector in general and the 141990 Case Study Solution in particular includesthe prices of paper, the income level of customers, the inflation rate, and the total GDP development of the nation. All these forces combine impact the need for the publishing market. Along with it, the economic policies related to the import of books impact the total service at CPM. However, China's economic conditions are rather beneficial for CMP with high GDP growth and consumer income level.
Social and Demographical.
The consumer preferences are shifting towards digital publishing rather than the standard was of publishing. In this regard, CMP needs to focus on digital publishing to satisfy the changing consumer choices.
Technological forces impacting the CMP consist of the technological advancement in the reading techniques and so on. Improvement of science and innovation along with the rise of digital publishing might minimize the demand for the CMP products, if certain actions would not be taken soon.
Ecological forces impacting 141990 Case Study Solution includes the issues of ecological neighborhoods over the usage of paper in publishing books. The paper utilized in the books while publishing is required to be disposable and the ink used while publishing should not be damaging for the environment.
Legal regulations for the publishing sector at whole are high. Publishing Regulation 1997 needs the publishers to be approved first by the Government to be entered in the publishing market.
Market Analysis (Porter's 5 Forces Design).
Porter's 5 Forces Model might be used to analyze the attractiveness of the publishing market China. A quick analysis of the Porter's 5 Forces is provided as follows;.
Danger of New Entrants.
Dangers of new entrants in the Chinese Publishing Market is moderate. The possible growth in the industry tends to draw in brand-new entrants to the publishing industry. However, the existence of intense competitors and the requirement of huge capital tends to demotivate brand-new entrants to go into in the market.
Hazard of Replacement.
Danger of Substitution is high for the Chinese Publishing Industry. The alternative products for the published documents is the documents presented in the virtual libraries on certain sites. The altering consumer choices towards digital knowing increase the hazard of alternative for the market.
Competitive competition in the publishing market is high. The existence of a great deal of customers in the Chinese Publishing Market like CIP, PTP and so on tends to produce high competitive competition for CMP. Along with it, new entrants are likewise entering into the market increasing the competition for CMP.
Bargaining Power of Supplier.
The significant suppliers of the 141990 Case Study Analysis include the suppliers of the paper for publishing documents. As CMP is the largest publisher in the Chinese Publishing Market, therefore the total bargaining power of supplier for CMP is low.
Bargaining Power of Buyer.
Negotiating power of purchaser in the publishing market is high. Due to the existence of a large number of publishers in the Chinese market and the market saturation, the purchasers needs high quality files at competitive rates.
CMP operates in an extremely competitive industry with the presence of large number of rivals. The company has a competitive position in the market with the greatest market share in the Chinese publishing market. Major competitors of 141990 Case Study Analysis consist of;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIPis among the close competitors of CMP. Established in the exact same duration, CIP releases similar kind of books. For a big time period, CIP held the biggest market share, and still ranks second and third in numerous market sectors, with a major focus on instructional publications. CIP serves as a danger for CMP as it might wean its market share due to its long term competitive background. CIP is concentrated on digital publishing and might wean the marketplace share of 141990 Case Study Analysis quickly in the current market scenario.
Posts and telecommunication Press (PTP).
Another close rival of CMP is PTP. It was likewise established in the exact same duration as CMP and CIP. It ranks sixth in the state-owned publishers in regards to company scale. It is likewise among the prominent gamers in the publishing market with an annual overall profits of RMB 550 million in 2010.
Alternative-1: Expand towards New Markets
• Reducing dependence over the Chinese markets.
• Increasing variety of Consumers
• Growth opportunities.
• Avoiding the impact of market saturation in the Chinese publishing industry.
• Usage of possible resources in growth.
• Threat of failure in brand-new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
• Sustaining consumer base.
• Approaching new markets.
• Easy to present using existing capabilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased item portfolio offers high worth to customers.
• Competitors in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core business sections to the brand-new one can lead the business to lose demand of its products in the market.
As the choices are shifting towards digital publishing and the company require an instant option to avoid the decreasing industry development. The company could also consider the expansion program after the success of its digital publishing program.
In order to introduce digital publishing in its product portfolio, the business should initially gathers the data related to the consumer demand, the possible markets, the federal government guidelines and the data related to the competitors presented in the market. If the initial offering proves a success, the company must go for the other markets. In this method the company would be able to execute its digital publishing program.
The growth of the publishing industry is declining because 2008, showing a threat to the company's long term existence, but the circumstance can be managed by considering a development strategy in the future. The business might think about presenting digital publishingin its existing market to execute its advancement program at immediate basis and to prevent the danger of failure for entrance in the brand-new markets.