Alibaba Ipo Dilemma Case Study Solution and Analysis
Alibaba Ipo Dilemma Case Study Help is the largest publishing company with a highest market share in the China's book retail market. CMP supplies a number of services including; collecting information, processing information and interaction services. Significant business sections of the business consist of; books, regulars, consultancy and circulation. The business has a vast product portfolio and its major items consist of books, periodicals, online media, exhibitions, research reports etc. Alibaba Ipo Dilemma Case Study Help has become a specialized information service provider and a big extensive Science and Innovation publishing business through the combination of print media, audio-visual media and the network media.
CMP has actually spent its 60 years journey smoothly, being an effective publishing home, nevertheless, the altering macro market patterns and forces bring particular obstacles to the publishing market in basic and Alibaba Ipo Dilemma Case Study Analysis in specific. These factors include;
• Entrance of the brand-new publishing firms in the market.
• Decreasing growth of the publishing market.
• Market saturation.
• Intro of digital publishing methods
• Enhancement of science and technology.
The change of the macro markets have raised a number of questions to the management at CPM that what could be the future of CMP in this circumstance? Do the long valuable experience, technical resources and the capabilities of the company could be utilized to pursue the future development unceasingly? How could the company sustain its long term competitive position in future?
Alibaba Ipo Dilemma Case Study Help has particular strengths that can be used to reduce the dangers, get rid of the weak point and obtain the chances. Strengths of CMP are offered as follows;
• The long term experience of Alibaba Ipo Dilemma Case Study Help in the publishing market i.e. 60 years enables the business to supply high quality products at a lower cost utilizing its prior experiences.
• The technical resources and abilities created by its successful journey supply a competitive advantage to CMP.
• Large product portfolioof CMP assists it to diversify its threat and offer high worth to its customers.
• Strong monetary position enables the company to think about a number of advancement chances without any fear of raising fund externally.
Along with the strengths, the company has specific weaknesses which might increase constraints for the company in implementing its development program. The weaknesses of Alibaba Ipo Dilemma Case Study Analysis are provided as follows;
• Despite of being a science and technology publishing company, the business still has conventional methods ofpublishing which are not compatible with the growing technological shift.
• CMP extremely relies over the Chinese markets for its development. It needs to propose particular expansion plans to prevent its reliance over the Chinese markets to accomplish long term growth.
The growth of the publishing industry is decreasing because 2008, impacting Alibaba Ipo Dilemma Case Study Analysis as well, but the development could be revived by availing specific chances presented in the market. The market chances for CMP consist of;
• The company might also introduce Digital Publishing by utilizing its long term technical experience and a strong customer acknowledgment in the market.
• CMP could think about an advancement program through the expansion towards foreign markets in order to reduce its dependence over Chinese markets by utilizing its large funds.
The changing macro trends in the market and increasing competition in the publishing industry has postured particular risks to Alibaba Ipo Dilemma Case Study Help including;( Gurel, 2017).
• Introduction of digital publishing i.e. virtual libraries could cause declining market share of Alibaba Ipo Dilemma Case Study Help due to the consumer shift towards digital libraries.
• The existence of large number of competitors in the publishing market increase the threat for CMP to lose its competitive position in the market, as rivals can get a strong customer base by using particular methods like aggressive promotion, quality products, and so on
• Entrance of new publishing companies in the market together with existence of high competition increases the hazard of losing the customer base.
Due to lack of information, the financial ratios of CMP might not be determined. It might be analyzed from the Appendix III that the annual total revenues of Alibaba Ipo Dilemma Case Study Solution throughout the duration 2000-2012 are growing at a high development rate, showing that the annual demand of the items of CMP is growing and the business is rather efficient in attracting a big number of consumers at a prospective cost.
Along with it, the second graph which reveals the annual growth in the Alibaba Ipo Dilemma Case Study Solution total assets, reveals that the company is quite efficient in adding worth to its possessions through its earnings. The growth in assets shows that the overall worth of the company is likewise increasing with increasing the overall earnings. (Unknown, 2013).
Another monetary analysis of the company utilizing the given information might be the analysis regarding the distribution of overall incomes of the business. Major part of the revenues of CMP originates from the sales of its published books i.e. 64% as displayed in the Case Appendix V. The company might move towards other business sections with a potential growth to accomplish its future development objective.
PESTEL analysis could be performed to discover the different external forces affecting the performance of the business and the current trends in the external environment of the company. A short PESTEL analysis of the business is provided as follows; (Alanzi, 2018).
As the publishing sector could have a considerable impact on the frame of mind of individuals about the communist ideology of the federal government, for that reason, the publishing sector is highly supervised and assisted 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 concerning the publishing sector are also increasing with the passage of time.
Economic forces affecting the publishing sector in general and the Alibaba Ipo Dilemma Case Study Solution in particular includesthe prices of paper, the income level of consumers, the inflation rate, and the general GDP growth of the country. All these forces integrate impact the need for the publishing market. Along with it, the financial policies associated with the import of books impact the general organisation at CPM. China's economic conditions are rather favorable for CMP with high GDP growth and consumer income level.
Social and Demographical.
The customer preferences are moving towards digital publishing rather than the traditional was of publishing. In this regard, CMP ought to focus on digital publishing to satisfy the changing customer preferences.
Technological forces impacting the CMP consist of the technological development in the reading techniques etc. Enhancement of science and technology together with the rise of digital publishing could decrease the need for the CMP products, if specific actions would not be taken soon.
Environmental forces impacting Alibaba Ipo Dilemma Case Study Solution consists of the concerns of environmental communities over the use of paper in publishing books. The paper utilized in the books while publishing is needed to be non reusable and the ink utilized while publishing should not be harmful for the environment.
Legal policies for the publishing sector at whole are high. The legal policies concerning the publishing sector is controlled by the General Administration of Press and Publication. Publishing Regulation 1997 requires the publishers to be approved initially by the Federal government to be entered in the publishing market. The regulation forbids direct involvement of foreign entities and people in the publishing sector.
Industry Analysis (Porter's Five Forces Model).
Porter's 5 Forces Model might be utilized to examine the appearance of the publishing market China. A short analysis of the Porter's Five Forces is given as follows;.
Danger of New Entrants.
Hazards of new entrants in the Chinese Publishing Market is moderate. The potential growth in the market tends to draw in new entrants to the publishing industry. The presence of extreme competition and the requirement of substantial capital tends to demotivate new entrants to enter in the market.
Threat of Substitution.
Risk of Alternative is high for the Chinese Publishing Industry. The alternative products for the published files is the files provided in the digital libraries on certain sites. The altering customer preferences towards digital learning increase the hazard of alternative for the market.
Competitive competition in the publishing market is high. The existence of large number of customers in the Chinese Publishing Market like CIP, PTP etc. tends to produce high competitive rivalry for CMP. In addition to it, brand-new entrants are also participating in the market increasing the competition for CMP.
Bargaining Power of Provider.
The major suppliers of the Alibaba Ipo Dilemma Case Study Analysis consist of the suppliers of the paper for releasing files. As CMP is the largest publisher in the Chinese Publishing Market, for that reason the general bargaining power of provider for CMP is low.
Bargaining Power of Purchaser.
Negotiating power of buyer in the publishing industry is high. Due to the existence of a a great deal of publishers in the Chinese market and the marketplace saturation, the purchasers needs high quality documents at competitive rates.
CMP runs in an extremely competitive market with the presence of a great deal of rivals. Nevertheless, the business has a competitive position in the market with the highest market share in the Chinese publishing market. Significant competitors of Alibaba Ipo Dilemma Case Study Help consist of;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIP acts as a risk for CMP as it might wean its market share due to its long term competitive background. CIP is focused on digital publishing and might wean the market share of CMP quickly in the current market scenario.
Posts and telecommunication Press (PTP).
Another close competitor of CMP is PTP. It was also founded in the exact same duration as CMP and CIP. It ranks 6th in the state-owned publishers in regards to organisation scale. It is likewise one of the prominent gamers in the publishing market with a yearly overall incomes of RMB 550 million in 2010.
Alternative-1: Broaden towards New Markets
• Reducing reliance over the Chinese markets.
• Increasing variety of Clients
• Growth opportunities.
• Preventing the impact of market saturation in the Chinese publishing market.
• Usage of potential resources in growth.
• Danger of failure in new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
• Sustaining customer base.
• Approaching new markets.
• Easy to present utilizing present capabilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased item portfolio offers high worth to customers.
• Competition in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core organisation segments to the brand-new one can lead the business to lose demand of its items in the market.
As the preferences are shifting towards digital publishing and the company require an instant service to avoid the declining industry development. The company might likewise consider the expansion program after the success of its digital publishing program.
In order to present digital publishing in its product portfolio, the company must initially gathers the data related to the customer need, the potential markets, the federal government guidelines and the data related to the rivals presented in the market. If the preliminary offering shows a success, the business ought to go for the other markets. In this way the company would be able to execute its digital publishing program.
The development of the publishing industry is decreasing given that 2008, showing a threat to the business's long term existence, however the scenario can be controlled by thinking about an advancement plan in the future. The company might consider presenting digital publishingin its existing market to execute its advancement program at immediate basis and to prevent the danger of failure for entryway in the new markets.