Avid Life A Case Study Solution and Analysis
Introduction
Avid Life A Case Study Analysis is the biggest publishing business with a highest market share in the China's book retail market. CMP has actually become a specialized information supplier and a large thorough Science and Technology publishing business through the integration of print media, audio-visual media and the network media.
Vital Concerns
CMP has actually invested its 60 years journey efficiently, being an effective publishing home, nevertheless, the changing macro market patterns and forces bring specific challenges to the publishing market in basic and Avid Life A Case Study Analysis in specific. These aspects include;
• Entryway of the new publishing firms in the industry.
• Decreasing growth of the publishing market.
• Market saturation.
• Intro of digital publishing strategies
• Enhancement of science and innovation.
The transformation 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 company could be used 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
Avid Life A Case Study Solution has particular strengths that can be used to reduce the dangers, get rid of the weakness and get the chances. Strengths of CMP are given as follows;
• The long term experience of Avid Life A Case Study Help in the publishing industry i.e. 60 years permits the business to supply high quality items at a lower cost using its prior experiences.
• The technical resources and capabilities produced by its effective journey provide a competitive advantage to CMP.
• Huge item portfolioof CMP helps it to diversify its threat and provide high worth to its clients.
• Strong financial position allows the business to think about numerous development opportunities with no fear of raising fund externally.
Weak points
In addition to the strengths, the business has specific weaknesses which could increase restraints for the company in executing its development program. The weaknesses of Avid Life A 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 suitable with the growing technological shift.
• CMP extremely relies over the Chinese markets for its development. It needs to propose particular growth plans to prevent its reliance over the Chinese markets to attain long term development.
Opportunities
The development of the publishing market is decreasing since 2008, affecting Avid Life A Case Study Analysis as well, however the growth could be revived by availing specific chances presented in the market. The market opportunities for CMP consist of;
• The business might likewise present Digital Publishing by utilizing its long term technical experience and a strong client acknowledgment in the market.
• CMP might consider an advancement program through the growth towards foreign markets in order to minimize its dependence over Chinese markets by utilizing its huge funds.
Hazards
The altering macro trends in the market and increasing competitors in the publishing market has actually positioned certain hazards to Avid Life A Case Study Solution including;( Gurel, 2017).
• Introduction of digital publishing i.e. digital libraries could cause declining market share of Avid Life A Case Study Solution due to the customer shift towards digital libraries.
• The existence of a great deal of competitors in the publishing industry increase the risk for CMP to lose its competitive position in the market, as competitors can acquire a strong consumer base by using particular strategies like aggressive promo, quality products, and so on
• Entryway of new publishing firms in the industry along with existence of high competitors increases the danger of losing the client base.
Financial Analysis.
Due to absence of data, the monetary ratios of CMP could not be calculated. It could be evaluated from the Appendix III that the annual total revenues of Avid Life A Case Study Solution throughout the period 2000-2012 are growing at a high development rate, showing that the yearly demand of the items of CMP is growing and the company is rather effective in attracting a large number of consumers at a possible cost.
In addition to it, the second chart which reveals the yearly development in the Avid Life A Case Study Help overall properties, reveals that the business is rather effective in adding worth to its assets through its incomes. The development in properties reveals that the overall worth of the firm is likewise increasing with increasing the total earnings. (Unknown, 2013).
Another monetary analysis of the business using the given data could be the analysis regarding the circulation of total revenues of the business. Major part of the earnings of CMP comes from the sales of its published books i.e. 64% as displayed in the Case Appendix V. The business might move towards other organisation segments with a possible development to attain its future advancement objective.
PESTEL Analysis
PESTEL analysis might be performed to discover the numerous external forces impacting the performance of the company and the recent patterns in the external environment of the business. A quick PESTEL analysis of the business is offered as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a substantial influence on the frame of mind of the people about the communist ideology of the federal government, therefore, the publishing sector is highly monitored and directed by the Promotion Department of the Communist Celebration of China. It could be said that the overall political forces affecting CMP business are high. The federal government policies concerning the publishing sector are likewise increasing with the passage of time.
Cost-effective.
Financial forces impacting the publishing sector in basic and the Avid Life A Case Study Solution in particular includesthe prices of paper, the earnings level of customers, the inflation rate, and the total GDP development of the country. All these forces integrate impact the demand for the publishing market. In addition to it, the economic policies associated with the import of books impact the overall company at CPM. China's economic conditions are rather beneficial for CMP with high GDP growth and customer income level.
Social and Demographical.
The customer preferences are moving towards digital publishing rather than the traditional was of publishing. In this regard, CMP needs to focus on digital publishing to satisfy the altering consumer preferences.
Technological.
Technological forces impacting the CMP consist of the technological development in the reading methods etc. Improvement of science and technology in addition to the increase of digital publishing might decrease the demand for the CMP products, if certain actions would not be taken soon.
Environmental.
Ecological forces affecting Avid Life A Case Study Analysis includes the concerns of environmental neighborhoods over the use of paper in publishing books. The paper used in the books while publishing is needed to be non reusable and the ink utilized while publishing ought to not be damaging for the environment.
Legal.
Legal guidelines for the publishing sector at whole are high. The legal policies regarding the publishing sector is managed by the General Administration of Press and Publication. Publishing Ordinance 1997 needs the publishers to be approved first by the Government to be entered in the publishing market. The regulation prohibits direct involvement of foreign entities and individuals in the publishing sector.
Market Analysis (Porter's 5 Forces Design).
Porter's Five Forces Design might be used to examine the attractiveness of the publishing industry China. A brief analysis of the Porter's 5 Forces is offered as follows;.
Threat of New Entrants.
Dangers of new entrants in the Chinese Publishing Market is moderate. The potential growth in the industry tends to attract brand-new entrants to the publishing market. Nevertheless, the presence of extreme competitors and the requirement of substantial capital tends to demotivate brand-new entrants to go into in the marketplace.
Hazard of Replacement.
Danger of Substitution is high for the Chinese Publishing Market. The substitute products for the published documents is the files provided in the digital libraries on certain websites. The changing customer preferences towards digital knowing increase the hazard of replacement for the market.
Competitive Rivalry.
Competitive rivalry in the publishing industry is high. The existence of large number of consumers in the Chinese Publishing Industry like CIP, PTP and so on tends to produce high competitive competition for CMP. Together with it, new entrants are also entering into the marketplace increasing the competition for CMP.
Bargaining Power of Provider.
The major providers of the Avid Life A Case Study Help include the suppliers of the paper for publishing documents. As CMP is the largest publisher in the Chinese Publishing Market, therefore the general bargaining power of supplier for CMP is low.
Bargaining Power of Buyer.
Haggling power of purchaser 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 purchasers needs high quality documents at competitive costs.
Competitors Analysis.
CMP runs in a highly competitive market with the existence of large number of competitors. Nevertheless, the business has a competitive position in the market with the greatest market share in the Chinese publishing market. Significant rivals of Avid Life A Case Study Help include;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry 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 quickly in the existing market circumstance.
Posts and telecommunication Press (PTP).
Another close competitor of CMP is PTP. It was likewise founded in the very same period as CMP and CIP. It ranks sixth in the state-owned publishers in regards to organisation scale. It is likewise one of the popular players in the publishing market with an annual total profits of RMB 550 million in 2010.
Alternatives
Alternative-1: Expand towards New Markets
Pros
• Lowering reliance over the Chinese markets.
• Increasing number of Consumers
• Growth chances.
• Avoiding the effect of market saturation in the Chinese publishing industry.
Cons
• Usage of potential resources in growth.
• Threat of failure in brand-new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining customer base.
• Approaching new markets.
• Easy to introduce using present abilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased item portfolio provides high value to consumers.
Cons
• Competition in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core business sectors to the new one can lead the company to lose demand of its products in the market.
Suggestions
As the choices are shifting towards digital publishing and the company need an immediate option to avoid the declining market growth. The business could also consider the growth program after the success of its digital publishing program.
Application
In order to present digital publishing in its item portfolio, the business must initially gathers the data related to the customer need, the potential markets, the government guidelines and the information related to the competitors provided in the market. If the preliminary offering proves a success, the business needs to go for the other markets. In this way the company would be able to implement its digital publishing program.
Conclusion
Although, the growth of the publishing industry is decreasing because 2008, revealing a danger to the company's long term existence, however the circumstance can be managed by thinking about an advancement strategy in the future. The business could think about introducing digital publishingin its existing market to execute its advancement program at instant basis and to avoid the danger of failure for entrance in the new markets.
