Can This Merger Be Saved Case Study Solution and Analysis
Intro
Can This Merger Be Saved Case Study Help is the biggest publishing company with a greatest market share in the China's book retail market. CMP provides a number of services including; collecting information, processing info and communication services. Major organisation segments of the business consist of; books, periodicals, consultancy and distribution. The company has a vast product portfolio and its significant items consist of books, regulars, online media, exhibits, research reports etc. Can This Merger Be Saved Case Study Help has ended up being a specialized details service provider and a big extensive Science and Technology publishing company through the integration of print media, audio-visual media and the network media.
Critical Problems
CMP has actually spent its 60 years journey smoothly, being a successful publishing home, however, the changing macro market patterns and forces bring certain difficulties to the publishing market in general and Can This Merger Be Saved Case Study Analysis in specific. These factors consist of;
• Entrance of the new publishing firms in the market.
• Declining growth of the publishing market.
• Market saturation.
• Intro of digital publishing strategies
• Enhancement of science and technology.
The transformation of the macro markets have raised numerous concerns to the management at CPM that what could be the future of CMP in this scenario? Do the long important experience, technical resources and the capabilities of the business could be used to pursue the future development unceasingly? How could the business sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Can This Merger Be Saved Case Study Analysis has specific strengths that can be utilized to reduce the hazards, overcome the weakness and obtain the chances. Strengths of CMP are provided as follows;
• The long term experience of Can This Merger Be Saved Case Study Analysis in the publishing industry i.e. 60 years permits the company to provide high quality items at a lower expense utilizing its previous experiences.
• The technical resources and capabilities created by its successful journey provide a competitive advantage to CMP.
• Huge item portfolioof CMP helps it to diversify its danger and supply high worth to its consumers.
• Strong monetary position permits the business to think about several advancement opportunities without any worry of raising fund externally.
Weak points
Together with the strengths, the business has specific weaknesses which could increase constraints for the business in implementing its development program. The weak points of Can This Merger Be Saved Case Study Help are provided as follows;
• Despite of being a science and technology publishing firm, the business still has standard ways ofpublishing which are not suitable with the growing technological shift.
• CMP extremely relies over the Chinese markets for its growth. It must propose particular expansion plans to avoid its reliance over the Chinese markets to accomplish long term growth.
Opportunities
Although, the growth of the publishing industry is declining considering that 2008, impacting Can This Merger Be Saved Case Study Solution too, however the growth could be restored by availing particular opportunities presented in the market. The marketplace opportunities for CMP include;
• 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 using its huge financial resources.
Risks
The altering macro patterns in the market and increasing competition in the publishing industry has actually postured particular threats to Can This Merger Be Saved Case Study Analysis consisting of;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries might cause decreasing market share of Can This Merger Be Saved Case Study Help due to the consumer shift towards virtual libraries.
• The existence of a great deal of rivals in the publishing industry increase the hazard for CMP to lose its competitive position in the market, as competitors can acquire a strong consumer base by utilizing certain techniques like aggressive promo, quality products, and so on
• Entrance of new publishing companies in the market together with existence of high competitors increases the danger of losing the customer base.
Monetary Analysis.
The company has a quite competitive financial performance. Due to absence of information, the financial ratios of CMP could not be determined. The overall monetary performance of the company might be analyzed by utilizing the charts offered in the case Appendices. It might be evaluated from the Appendix III that the yearly total profits of CMP throughout the period 2000-2012 are growing at a high development rate, revealing that the annual need of the items of Can This Merger Be Saved Case Study Help is growing and the company is quite effective in attracting a large number of customers at a prospective price.
Together with it, the 2nd chart which shows the annual development in the Can This Merger Be Saved Case Study Help overall assets, shows that the business is quite effective in adding worth to its properties through its earnings. The growth in possessions reveals that the overall worth of the firm is also increasing with increasing the total profits. (Unidentified, 2013).
Another financial analysis of the business utilizing the provided data could be the analysis concerning the circulation of total profits of the company. Huge part of the profits of CMP originates from the sales of its released books i.e. 64% as shown in the Case Appendix V. The company might move towards other company sectors with a possible growth to achieve its future development goal.
PESTEL Analysis
PESTEL analysis could be performed to discover the different external forces affecting the efficiency of the company and the recent patterns in the external environment of the company. A quick PESTEL analysis of the business is offered as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a substantial impact on the frame of mind of individuals about the communist ideology of the federal government, therefore, the publishing sector is highly monitored and assisted by the Promotion Department of the Communist Celebration of China. For that reason, it might be said that the total political forces affecting Can This Merger Be Saved Case Study Help business are high. The government policies regarding the publishing sector are also increasing with the passage of time.
Cost-effective.
Economic forces impacting the publishing sector in basic and the CMP in specific includesthe rates of paper, the earnings level of customers, the inflation rate, and the overall GDP growth of the country. All these forces combine effect the demand for the publishing market.
Social and Demographical.
The consumer choices are moving towards digital publishing rather than the conventional was of publishing. In this regard, CMP must focus on digital publishing to satisfy the changing customer preferences.
Technological.
Technological forces affecting the CMP include the technological advancement in the reading techniques etc. Enhancement of science and technology along with the increase of digital publishing could minimize the need for the CMP items, if particular actions would not be taken quickly.
Environmental.
Ecological forces impacting Can This Merger Be Saved Case Study Solution consists of the concerns of ecological 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 policies for the publishing sector at whole are high. Publishing Ordinance 1997 requires the publishers to be authorized first by the Government to be entered in the publishing market.
Industry Analysis (Porter's Five Forces Model).
Porter's 5 Forces Design could be utilized to examine the attractiveness of the publishing industry China. A short analysis of the Porter's 5 Forces is offered as follows;.
Danger of New Entrants.
Threats of new entrants in the Chinese Publishing Industry is moderate. The possible development in the market tends to draw in new entrants to the publishing market. However, the existence of extreme competitors and the requirement of big capital tends to demotivate brand-new entrants to go into in the market.
Threat of Substitution.
Hazard of Alternative is high for the Chinese Publishing Market. The alternative products for the published files is the documents provided in the virtual libraries on particular websites. The changing consumer choices towards digital learning increase the threat of alternative for the market.
Competitive Rivalry.
Competitive rivalry in the publishing market is high. The existence of a great deal of customers in the Chinese Publishing Market like CIP, PTP etc. tends to produce high competitive rivalry for CMP. In addition to it, new entrants are likewise entering into the marketplace increasing the competition for CMP.
Bargaining Power of Provider.
The major providers of the Can This Merger Be Saved Case Study Help consist of the providers of the paper for publishing documents. As CMP is the biggest publisher in the Chinese Publishing Market, therefore the total bargaining power of provider for CMP is low.
Bargaining Power of Purchaser.
Negotiating power of buyer in the publishing market is high. Due to the presence of a large number of publishers in the Chinese market and the market saturation, the buyers needs high quality documents at competitive costs.
Rivals Analysis.
CMP operates in a highly competitive industry with the presence of a great deal of competitors. However, the business has a competitive position in the market with the highest market share in the Chinese publishing market. Significant rivals of Can This Merger Be Saved Case Study Solution include;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIPis one of the close rivals of CMP. Founded in the same period, CIP publishes similar type of books. For a large time period, CIP held the largest market share, and still ranks 2nd and third in various market sectors, with a major focus on instructional publications. CIP functions as a hazard 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 Can This Merger Be Saved Case Study Solution easily in the current market situation.
Posts and telecommunication Press (PTP).
It was also founded in the exact same duration as Can This Merger Be Saved Case Study Solution and CIP. It is likewise one of the popular gamers in the publishing market with an annual total earnings of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Reducing dependence over the Chinese markets.
• Increasing variety of Consumers
• Growth chances.
• Avoiding the impact of market saturation in the Chinese publishing market.
Cons
• Usage of prospective resources in expansion.
• Danger of failure in new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining consumer base.
• Approaching brand-new markets.
• Easy to introduce using existing capabilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased item portfolio provides high worth to customers.
Cons
• Competition in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core organisation sectors to the new one can lead the company to lose demand of its products in the market.
Suggestions
As the preferences are shifting towards digital publishing and the company need an immediate solution to prevent the declining market growth. The business could also consider the growth program after the success of its digital publishing program.
Implementation
In order to present digital publishing in its product portfolio, the company should first gathers the information related to the consumer need, the potential markets, the government guidelines and the information related to the rivals provided in the market. If the initial offering shows a success, the company needs to go for the other markets. In this method the company would be able to implement its digital publishing program.
Conclusion
Although, the growth of the publishing industry is decreasing because 2008, showing a threat to the business's long term presence, but the circumstance can be controlled by considering an advancement plan in the future. The business could think about presenting digital publishingin its existing market to implement its advancement program at immediate basis and to prevent the risk of failure for entrance in the new markets.
