Anandam Manufacturing Company Analysis Of Financial Statement Case Study Solution and Analysis
Introduction
Anandam Manufacturing Company Analysis Of Financial Statement Case Study Help is the largest publishing company with a greatest market share in the China's book retail market. CMP has ended up being a specialized details service provider and a large thorough Science and Innovation publishing company through the combination of print media, audio-visual media and the network media.
Vital Issues
CMP has actually invested its 60 years journey smoothly, being a successful publishing house, however, the altering macro market trends and forces bring particular obstacles to the publishing industry in basic and Anandam Manufacturing Company Analysis Of Financial Statement Case Study Help in particular. These aspects include;
• Entrance of the new publishing firms in the industry.
• Declining development of the publishing market.
• Market saturation.
• Intro of digital publishing methods
• Improvement of science and innovation.
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 situation? Do the long valuable experience, technical resources and the capabilities of the business could be made use of to pursue the future advancement unceasingly? How could the company sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Anandam Manufacturing Company Analysis Of Financial Statement Case Study Help has particular strengths that can be utilized to reduce the risks, conquer the weak point and avail the chances. Strengths of CMP are given as follows;
• The long term experience of Anandam Manufacturing Company Analysis Of Financial Statement Case Study Help in the publishing market i.e. 60 years enables the company to offer high quality items at a lower cost utilizing its previous experiences.
• The technical resources and capabilities generated by its effective journey offer a competitive advantage to CMP.
• Large product portfolioof CMP assists it to diversify its threat and supply high value to its clients.
• Strong financial position allows the business to consider several development opportunities without any worry of raising fund externally.
Weaknesses
In addition to the strengths, the company has specific weaknesses which might increase restrictions for the business in executing its development program. The weak points of Anandam Manufacturing Company Analysis Of Financial Statement Case Study Analysis are offered as follows;
• Despite of being a science and innovation publishing firm, the company still has traditional ways 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 dependence over the Chinese markets to achieve long term development.
Opportunities
Although, the development of the publishing industry is decreasing considering that 2008, affecting Anandam Manufacturing Company Analysis Of Financial Statement Case Study Solution also, but the growth could be revived by availing specific chances provided in the market. The marketplace opportunities for CMP consist of;
• The company could also present Digital Publishing by using its long term technical experience and a strong consumer recognition in the market.
• CMP could consider a development program through the growth towards foreign markets in order to lower its reliance over Chinese markets by utilizing its large financial resources.
Threats
The altering macro trends in the market and increasing competitors in the publishing industry has posed particular dangers to Anandam Manufacturing Company Analysis Of Financial Statement Case Study Help including;( Gurel, 2017).
• Intro of digital publishing i.e. virtual libraries could cause declining market share of Anandam Manufacturing Company Analysis Of Financial Statement Case Study Analysis due to the consumer shift towards virtual libraries.
• The existence of a great deal of rivals in the publishing market increase the risk for CMP to lose its competitive position in the market, as competitors can gain a strong consumer base by utilizing particular techniques like aggressive promo, quality items, and so on
• Entryway of new publishing firms in the industry together with presence of high competitors increases the danger of losing the customer base.
Monetary Analysis.
Due to absence of data, the financial ratios of CMP could not be computed. It could be evaluated from the Appendix III that the annual total earnings of Anandam Manufacturing Company Analysis Of Financial Statement Case Study Help throughout the duration 2000-2012 are growing at a high growth rate, showing that the annual demand of the products of CMP is growing and the company is rather effective in attracting a big number of customers at a potential cost.
Along with it, the 2nd chart which reveals the yearly growth in the Anandam Manufacturing Company Analysis Of Financial Statement Case Study Help overall assets, shows that the company is rather effective in including worth to its possessions through its revenues. The growth in assets shows that the overall value of the firm is likewise increasing with increasing the total profits. (Unidentified, 2013).
Another monetary analysis of the company using the provided data might be the analysis relating to the distribution of overall profits of the business. Huge part of the earnings 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 prospective growth to accomplish its future development objective.
PESTEL Analysis
PESTEL analysis could be conducted to find out the numerous external forces affecting the performance of the company and the recent patterns in the external environment of the business. A quick PESTEL analysis of the business is given as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a substantial impact on the frame of mind of the people about the communist ideology of the government, for that reason, the publishing sector is extremely monitored and guided by the Publicity Department of the Communist Party of China. Therefore, it might be said that the general political forces affecting Anandam Manufacturing Company Analysis Of Financial Statement Case Study Solution organisation are high. The government policies relating to the publishing sector are likewise increasing with the passage of time.
Affordable.
Financial forces affecting the publishing sector in general and the Anandam Manufacturing Company Analysis Of Financial Statement Case Study Solution in particular includesthe prices of paper, the earnings level of consumers, the inflation rate, and the overall GDP development of the nation. All these forces integrate impact the demand for the publishing market. In addition to it, the financial policies associated with the import of books impact the total company at CPM. However, China's financial conditions are quite favorable for CMP with high GDP growth and customer income level.
Social and Demographical.
Social and demographical forces consist of the population growth, the customer's preferences towards checking out informative materials and so on. China has the highest population in the world with a high population growth, revealing the increasing number of consumers of the Anandam Manufacturing Company Analysis Of Financial Statement Case Study Analysis. The consumer preferences are shifting towards digital publishing rather than the conventional was of publishing. In this regard, CMP should focus on digital publishing to satisfy the changing customer preferences.
Technological.
Technological forces impacting the CMP consist of the technological development in the reading techniques etc. Enhancement of science and technology in addition to the increase of digital publishing might reduce the demand for the CMP products, if particular actions would not be taken quickly.
Environmental.
Ecological forces impacting Anandam Manufacturing Company Analysis Of Financial Statement Case Study Solution includes the issues of environmental communities over the use of paper in publishing books. The paper utilized in the books while publishing is needed to be disposable and the ink used while publishing must not be hazardous for the environment.
Legal.
Legal guidelines for the publishing sector at whole are high. The legal policies relating to the publishing sector is managed by the General Administration of Press and Publication. Publishing Regulation 1997 requires the publishers to be approved initially by the Government to be entered in the publishing market. The regulation forbids direct participation of foreign entities and individuals in the publishing sector.
Market Analysis (Porter's Five Forces Model).
Porter's 5 Forces Model could be used to analyze the beauty of the publishing market China. A brief analysis of the Porter's Five Forces is offered as follows;.
Danger of New Entrants.
Dangers of brand-new entrants in the Chinese Publishing Industry is moderate. The possible growth in the market tends to draw in new entrants to the publishing industry. The existence of intense competition and the requirement of huge capital tends to demotivate brand-new entrants to enter in the market.
Hazard of Replacement.
Danger of Substitution is high for the Chinese Publishing Industry. The alternative products for the released documents is the files presented in the virtual libraries on certain sites. The altering customer choices towards digital learning increase the hazard of replacement for the market.
Competitive Rivalry.
Competitive rivalry in the publishing industry is high. The presence of large number of consumers in the Chinese Publishing Market like CIP, PTP etc. tends to produce high competitive rivalry for CMP. Together with it, brand-new entrants are likewise entering into the market increasing the competitors for CMP.
Bargaining Power of Provider.
The significant providers of the Anandam Manufacturing Company Analysis Of Financial Statement Case Study Help consist of the suppliers of the paper for publishing documents. As CMP is the largest publisher in the Chinese Publishing Market, for that reason the general bargaining power of supplier for CMP is low.
Bargaining Power of Buyer.
Haggling power of buyer in the publishing market is high. Due to the existence of a a great deal of publishers in the Chinese market and the market saturation, the buyers requires high quality documents at competitive costs.
Rivals Analysis.
CMP operates in an extremely competitive market with the existence of a great deal of rivals. The company has a competitive position in the market with the greatest market share in the Chinese publishing market. Significant rivals of Anandam Manufacturing Company Analysis Of Financial Statement Case Study Solution consist of;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIP acts as a threat 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 easily in the current market situation.
Posts and telecommunication Press (PTP).
It was also established in the very same period as Anandam Manufacturing Company Analysis Of Financial Statement Case Study Help and CIP. It is also one of the prominent players in the publishing market with an annual overall earnings of RMB 550 million in 2010.
Alternatives
Alternative-1: Expand towards New Markets
Pros
• Minimizing dependence over the Chinese markets.
• Increasing number of Clients
• Growth chances.
• Preventing the impact of market saturation in the Chinese publishing industry.
Cons
• Use of prospective resources in expansion.
• Danger of failure in new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
Pros
• Sustaining consumer base.
• Approaching brand-new markets.
• Easy to present using present capabilities.
• Low risk of Failure.
• Low requirement for funds.
• Increased item portfolio supplies high value to clients.
Cons
• Competition in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core business segments to the new one can lead the business to lose demand of its items in the market.
Suggestions
As the preferences are shifting towards digital publishing and the company require an immediate option to prevent the declining market growth. The business could likewise consider the expansion program after the success of its digital publishing program.
Application
In order to introduce digital publishing in its item portfolio, the business should initially collects the information connected to the customer demand, the possible markets, the federal government guidelines and the data associated with the rivals presented in the market. After that, the company needs to decide one possible section for its preliminary offering. It should collect research that how it could separate its digital publishing from the existing competitors' products. The steps above the company ought to go for the initial offering. The business must go for the other markets if the initial offering shows a success. In this method the company would have the ability to implement its digital publishing program.
Conclusion
Although, the development of the publishing industry is declining because 2008, revealing a risk to the company's long term existence, however the scenario can be controlled by considering an advancement strategy in the future. The business could consider introducing digital publishingin its existing market to execute its development program at immediate basis and to avoid the threat of failure for entryway in the new markets.
