Astral Records Ltd North America 2 Case Study Solution and Analysis
Astral Records Ltd North America 2 Case Study Help is the biggest publishing company with a highest market share in the China's book retail market. CMP has ended up being a specialized information supplier and a large extensive Science and Innovation publishing business through the combination of print media, audio-visual media and the network media.
Although, Astral Records Ltd North America 2 Case Study Analysis has spent its 60 years journey smoothly, being an effective publishing house, however, the changing macro market trends and forces bring specific difficulties to the publishing industry in basic and CMP in particular. These aspects consist of;
• Entrance of the new publishing firms in the market.
• Decreasing growth of the publishing market.
• Market saturation.
• Intro of digital publishing methods
• Improvement of science and innovation.
The improvement of the macro markets have raised numerous 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 company could be used to pursue the future development unceasingly? How could the business sustain its long term competitive position in future?
Astral Records Ltd North America 2 Case Study Solution has specific strengths that can be utilized to lower the threats, get rid of the weak point and get the chances. Strengths of CMP are offered as follows;
• The long term experience of Astral Records Ltd North America 2 Case Study Analysis in the publishing market i.e. 60 years permits the company to supply high quality products at a lower expense using its prior experiences.
• The technical resources and abilities produced by its successful journey provide a competitive advantage to CMP.
• Large item portfolioof CMP helps it to diversify its threat and supply high worth to its clients.
• Strong monetary position allows the business to think about a number of development chances with no fear of raising fund externally.
In addition to the strengths, the company has certain weaknesses which could increase restrictions for the company in executing its development program. The weaknesses of Astral Records Ltd North America 2 Case Study Solution are offered as follows;
• Despite of being a science and innovation publishing company, the company still has standard ways ofpublishing which are not compatible with the growing technological shift.
• CMP extremely relies over the Chinese markets for its growth. It should propose specific growth strategies to avoid its reliance over the Chinese markets to attain long term development.
The growth of the publishing industry is declining given that 2008, affecting Astral Records Ltd North America 2 Case Study Help as well, however the development could be restored by availing particular chances presented in the market. The market opportunities for CMP consist of;
• The business might also introduce Digital Publishing by utilizing its long term technical experience and a strong consumer recognition in the market.
• CMP could consider a development program through the expansion towards foreign markets in order to lower its dependence over Chinese markets by using its huge financial resources.
The altering macro trends in the market and increasing competitors in the publishing market has actually positioned certain hazards to Astral Records Ltd North America 2 Case Study Solution including;( Gurel, 2017).
• Introduction of digital publishing i.e. digital libraries could lead to decreasing market share of Astral Records Ltd North America 2 Case Study Analysis due to the customer shift towards virtual libraries.
• The existence of large number of rivals in the publishing industry increase the threat for CMP to lose its competitive position in the market, as rivals can get a strong customer base by utilizing specific strategies like aggressive promotion, quality items, and so on
• Entrance of brand-new publishing companies in the industry together with existence of high competitors increases the risk of losing the customer base.
Due to absence of information, the financial ratios of CMP could not be determined. It might be examined from the Appendix III that the yearly total profits of Astral Records Ltd North America 2 Case Study Help throughout the duration 2000-2012 are growing at a high development rate, showing that the annual demand of the products of CMP is growing and the business is quite efficient in attracting a big number of clients at a potential price.
Along with it, the 2nd graph which shows the yearly growth in the Astral Records Ltd North America 2 Case Study Help total assets, shows that the business is rather effective in including worth to its assets through its profits. The development in properties shows that the total worth of the company is also increasing with increasing the total incomes. (Unknown, 2013).
Another monetary analysis of the business using the provided data could be the analysis regarding the circulation of total profits of the business. Huge 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 company could move towards other business sectors with a potential development to achieve its future advancement goal.
PESTEL analysis might be performed to find out the numerous external forces impacting the efficiency of the company and the recent patterns in the external environment of the business. A brief PESTEL analysis of the company is offered as follows; (Alanzi, 2018).
As the publishing sector could have a considerable influence on the state of mind of individuals about the communist ideology of the federal government, for that reason, the publishing sector is extremely monitored and directed by the Publicity Department of the Communist Party of China. For that reason, it might be said that the overall political forces impacting Astral Records Ltd North America 2 Case Study Solution service 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 CMP in particular includesthe costs of paper, the income level of consumers, the inflation rate, and the total GDP development of the nation. All these forces combine effect the demand for the publishing market.
Social and Demographical.
Social and demographical forces consist of the population development, the customer's choices towards checking out useful products and so on. China has the greatest population worldwide with a high population growth, revealing the increasing variety of customers of the Astral Records Ltd North America 2 Case Study Help. The customer preferences are shifting towards digital publishing rather than the traditional was of publishing. In this regard, CMP must concentrate on digital publishing to fulfill the changing customer choices.
Technological forces impacting the CMP include the technological development in the reading methods etc. Improvement of science and innovation in addition to the rise of digital publishing could reduce the demand for the CMP products, if particular actions would not be taken soon.
Ecological forces affecting Astral Records Ltd North America 2 Case Study Analysis includes the concerns of environmental neighborhoods over the usage of paper in publishing books. The paper used in the books while publishing is required to be disposable and the ink utilized while publishing needs to not be hazardous for the environment.
Legal policies for the publishing sector at whole are high. The legal guidelines relating to the publishing sector is controlled by the General Administration of Press and Publication. Publishing Regulation 1997 needs the publishers to be approved initially by the Government to be gone into in the publishing market. The regulation prohibits direct participation of foreign entities and individuals in the publishing sector.
Industry Analysis (Porter's 5 Forces Model).
Porter's Five Forces Model could be utilized to examine the beauty of the publishing market China. A quick analysis of the Porter's Five Forces is given as follows;.
Hazard of New Entrants.
Threats of brand-new entrants in the Chinese Publishing Market is moderate. The possible development in the market tends to draw in new entrants to the publishing market. Nevertheless, the presence of intense competitors and the requirement of substantial capital tends to demotivate brand-new entrants to go into in the market.
Hazard of Replacement.
Risk of Substitution is high for the Chinese Publishing Industry. The alternative products for the published documents is the files presented in the digital libraries on specific websites. The altering customer preferences towards digital learning increase the risk of replacement for the market.
Competitive competition in the publishing industry is high. The presence of large number of customers in the Chinese Publishing Market like CIP, PTP and so on tends to produce high competitive rivalry for CMP. Together with it, new entrants are likewise entering into the marketplace increasing the competition for CMP.
Bargaining Power of Supplier.
The significant suppliers of the Astral Records Ltd North America 2 Case Study Solution include the suppliers of the paper for publishing documents. As CMP is the biggest publisher in the Chinese Publishing Market, therefore the overall bargaining power of supplier for CMP is low.
Bargaining Power of Buyer.
Bargaining power of purchaser in the publishing industry is high. Due to the existence of a large number of publishers in the Chinese market and the market saturation, the purchasers requires high quality files at competitive prices.
CMP operates in an extremely competitive industry with the presence of large number of rivals. However, the company has a competitive position in the market with the greatest market share in the Chinese publishing market. Significant competitors of Astral Records Ltd North America 2 Case Study Analysis consist of;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIP acts as a threat for CMP as it could 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 present market situation.
Posts and telecommunication Press (PTP).
Another close rival of CMP is PTP. It was likewise established in the exact same period as CMP and CIP. It ranks 6th in the state-owned publishers in regards to organisation scale. It is also one of the popular players in the publishing market with a yearly total revenues of RMB 550 million in 2010.
Alternative-1: Expand towards New Markets
• Reducing dependence over the Chinese markets.
• Increasing number of Consumers
• Growth chances.
• Avoiding the effect of market saturation in the Chinese publishing industry.
• Usage of potential resources in growth.
• Threat of failure in new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
• Sustaining consumer base.
• Approaching brand-new markets.
• Easy to present utilizing current abilities.
• Low risk of Failure.
• Low requirement for funds.
• Increased product portfolio offers high worth to clients.
• Competitors in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core organisation sectors to the brand-new one can lead the company to lose demand of its products in the market.
As the choices are moving towards digital publishing and the business need an instant service to prevent the declining market growth. The company might also think about the growth program after the success of its digital publishing program.
In order to introduce digital publishing in its item portfolio, the business should first collects the information related to the consumer demand, the prospective markets, the government policies and the information associated with the competitors provided in the market. After that, the business ought to choose one potential segment for its preliminary offering. It needs to collect research that how it might separate its digital publishing from the existing rivals' items. The actions above the company ought to go for the preliminary offering. If the initial offering shows a success, the company should choose the other markets. In this method the business would have the ability to implement its digital publishing program.
The growth of the publishing market is declining given that 2008, showing a hazard to the business's long term presence, however the circumstance can be controlled by thinking about a development strategy in the future. The business could consider presenting digital publishingin its existing market to execute its advancement program at instant basis and to avoid the risk of failure for entryway in the new markets.