Bank Of America Acquires Merrill Lynch A Case Study Solution and Analysis
Introduction
Bank Of America Acquires Merrill Lynch A Case Study Help is the largest publishing company with a greatest market share in the China's book retail market. CMP has actually ended up being a specialized information supplier and a large extensive Science and Innovation publishing company through the combination of print media, audio-visual media and the network media.
Vital Issues
Although, Bank Of America Acquires Merrill Lynch A Case Study Solution has actually spent its 60 years journey smoothly, being an effective publishing home, however, the changing macro market patterns and forces bring specific challenges to the publishing market in general and CMP in specific. These factors consist of;
• Entryway of the new publishing companies in the market.
• Declining growth of the publishing market.
• Market saturation.
• Intro of digital publishing techniques
• Improvement of science and technology.
The improvement of the macro markets have raised several questions to the management at CPM that what could be the future of CMP in this situation? Do the long important experience, technical resources and the abilities of the company could be used to strive for the future development unceasingly? How could the business sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Bank Of America Acquires Merrill Lynch A Case Study Analysis has particular strengths that can be utilized to minimize the hazards, overcome the weakness and get the chances. Strengths of CMP are provided as follows;
• The long term experience of Bank Of America Acquires Merrill Lynch A Case Study Analysis in the publishing industry i.e. 60 years permits the business to offer high quality items at a lower cost utilizing its previous experiences.
• The technical resources and abilities generated by its effective journey offer a competitive advantage to CMP.
• Large item portfolioof CMP helps it to diversify its threat and offer high worth to its clients.
• Strong financial position permits the company to consider numerous advancement chances without any worry of raising fund externally.
Weak points
Together with the strengths, the business has particular weak points which might increase restraints for the company in executing its advancement program. The weak points of Bank Of America Acquires Merrill Lynch A Case Study Help are given as follows;
• Despite of being a science and technology publishing firm, the company still has conventional 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 certain growth plans to prevent its reliance over the Chinese markets to accomplish long term growth.
Opportunities
The development of the publishing market is decreasing because 2008, impacting Bank Of America Acquires Merrill Lynch A Case Study Solution as well, however the growth could be revived by availing particular chances provided in the market. The marketplace chances for CMP consist of;
• The business might likewise present Digital Publishing by utilizing its long term technical experience and a strong client recognition in the market.
• CMP might think about an advancement program through the growth towards foreign markets in order to minimize its dependence over Chinese markets by utilizing its vast financial resources.
Dangers
The altering macro trends in the market and increasing competitors in the publishing industry has posed particular risks to Bank Of America Acquires Merrill Lynch A Case Study Solution including;( Gurel, 2017).
• Introduction of digital publishing i.e. virtual libraries could result in decreasing market share of Bank Of America Acquires Merrill Lynch A Case Study Solution due to the customer shift towards virtual libraries.
• The existence of a great deal of rivals in the publishing industry increase the danger for CMP to lose its competitive position in the market, as competitors can acquire a strong consumer base by utilizing certain techniques like aggressive promotion, quality items, and so on
• Entryway of new publishing firms in the market along with presence of high competitors increases the risk of losing the consumer base.
Financial Analysis.
The company has a rather competitive financial efficiency. Due to absence of data, the monetary ratios of CMP could not be calculated. The overall monetary efficiency of the company might be analyzed by utilizing the graphs given in the case Appendices. It might be examined from the Appendix III that the annual total profits of CMP during the duration 2000-2012 are growing at a high development rate, showing that the annual need of the items of Bank Of America Acquires Merrill Lynch A Case Study Analysis is growing and the company is rather effective in bring in a large number of customers at a prospective rate.
In addition to it, the second graph which reveals the yearly development in the Bank Of America Acquires Merrill Lynch A Case Study Analysis overall assets, shows that the business is rather efficient in including worth to its possessions through its revenues. The development in assets reveals that the overall value of the company is likewise increasing with increasing the overall revenues. (Unidentified, 2013).
Another monetary analysis of the company utilizing the provided data could be the analysis relating to the distribution of overall incomes of the business. Major part of the profits of CMP originates from the sales of its released books i.e. 64% as displayed in the Case Appendix V. The company might move towards other service sections with a potential development to accomplish its future advancement objective.
PESTEL Analysis
PESTEL analysis might be performed to find out the numerous external forces affecting the performance of the business and the current patterns in the external environment of the company. A quick PESTEL analysis of the company is offered as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a substantial effect on the mindset of the people about the communist ideology of the federal government, for that reason, the publishing sector is highly monitored and guided by the Publicity Department of the Communist Celebration of China. Therefore, it might be said that the overall political forces impacting Bank Of America Acquires Merrill Lynch A Case Study Solution company are high. The federal government policies relating to the publishing sector are likewise increasing with the passage of time.
Affordable.
Economic forces affecting the publishing sector in basic and the Bank Of America Acquires Merrill Lynch A Case Study Solution in particular includesthe rates of paper, the earnings level of customers, the inflation rate, and the general GDP development of the country. All these forces combine impact the need for the publishing market. Together with it, the financial policies related to the import of books impact the overall organisation at CPM. China's economic conditions are rather favorable for CMP with high GDP development and consumer earnings level.
Social and Demographical.
The customer choices are shifting towards digital publishing rather than the conventional was of publishing. In this regard, CMP must focus on digital publishing to meet the altering customer choices.
Technological.
Technological forces affecting the CMP consist of the technological improvement in the reading strategies and so on. Improvement of science and technology in addition to the rise of digital publishing might reduce the demand for the CMP items, if certain actions would not be taken quickly.
Environmental.
Ecological forces impacting Bank Of America Acquires Merrill Lynch A Case Study Analysis consists of the issues of ecological 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 should not be harmful for the environment.
Legal.
Legal regulations for the publishing sector at whole are high. The legal guidelines regarding the publishing sector is controlled by the General Administration of Press and Publication. Publishing Ordinance 1997 requires the publishers to be approved first by the Federal government to be entered in the publishing market. The ordinance forbids direct participation of foreign entities and individuals in the publishing sector.
Market Analysis (Porter's 5 Forces Model).
Porter's 5 Forces Model could be utilized to examine the attractiveness of the publishing market China. A brief analysis of the Porter's 5 Forces is given as follows;.
Danger of New Entrants.
Risks of brand-new entrants in the Chinese Publishing Industry is moderate. The potential growth in the industry tends to draw in new entrants to the publishing market. The presence of intense competitors and the requirement of big capital tends to demotivate new entrants to enter in the market.
Hazard of Replacement.
Threat of Substitution is high for the Chinese Publishing Industry. The alternative items for the released documents is the documents presented in the digital libraries on particular sites. The altering consumer preferences towards digital knowing increase the risk of replacement for the market.
Competitive Rivalry.
Competitive competition in the publishing market is high. The existence of a great deal of consumers in the Chinese Publishing Industry 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 Provider.
The significant providers of the Bank Of America Acquires Merrill Lynch A Case Study Solution consist of the providers of the paper for releasing documents. As CMP is the biggest publisher in the Chinese Publishing Market, for that reason the general bargaining power of provider for CMP is low.
Bargaining Power of Purchaser.
Haggling power of purchaser 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 files at competitive prices.
Competitors Analysis.
CMP operates 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 highest market share in the Chinese publishing market. Significant competitors of Bank Of America Acquires Merrill Lynch A Case Study Solution include;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIP acts as a risk for CMP as it could wean its market share due to its long term competitive background. CIP is focused on digital publishing and could wean the market share of CMP easily in the existing market scenario.
Posts and telecommunication Press (PTP).
Another close competitor of CMP is PTP. It was likewise founded in the exact same duration as CMP and CIP. It ranks sixth in the state-owned publishers in regards to business scale. It is also among the prominent gamers in the publishing market with an annual overall revenues of RMB 550 million in 2010.
Alternatives
Alternative-1: Expand towards New Markets
Pros
• Lowering dependence over the Chinese markets.
• Increasing number of Customers
• Development chances.
• Avoiding the effect of market saturation in the Chinese publishing industry.
Cons
• Use of possible resources in expansion.
• Danger of failure in new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
Pros
• Sustaining consumer base.
• Approaching new markets.
• Easy to introduce utilizing existing abilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased product portfolio supplies high value to clients.
Cons
• Competitors in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core company sections to the new one can lead the business to lose need of its items in the market.
Recommendations
With the deep analysis of the internal and external environment of the business together with the industry analysis and the rival analysis, Alternative 2 is suggested to CMP to attain its future advancement. As the choices are moving towards digital publishing and the company require an immediate service to avoid the declining industry development. For that reason, introduction of digital publishing might prove to be an immediate option with low amount of threat for the company. The company might also consider the growth program after the success of its digital publishing program.
Execution
In order to present digital publishing in its item portfolio, the company needs to first collects the information related to the customer demand, the potential markets, the federal government regulations and the data associated with the rivals provided in the market. After that, the business ought to choose one possible segment for its preliminary offering. It should gather research study that how it could distinguish its digital publishing from the existing rivals' products. After all the actions above the business ought to go for the preliminary offering. The company ought to go for the other markets if the initial offering proves a success. In this way the business would have the ability to execute its digital publishing program.
Conclusion
Although, the growth of the publishing market is decreasing considering that 2008, showing a risk to the business's long term presence, however the scenario can be controlled by considering a development plan in the future. The company might think about introducing digital publishingin its existing market to execute its development program at instant basis and to avoid the danger of failure for entryway in the brand-new markets.
