Colgate Palmolive Company Case Study Solution and Analysis
Colgate Palmolive Company Case Study Solution is the largest publishing business with a highest market share in the China's book retail market. CMP has actually become a specialized information service provider and a big comprehensive Science and Technology publishing company through the integration of print media, audio-visual media and the network media.
CMP has actually invested its 60 years journey efficiently, being a successful publishing home, however, the changing macro market trends and forces bring particular difficulties to the publishing market in basic and Colgate Palmolive Company Case Study Help in particular. These aspects include;
• Entryway of the new publishing companies in the industry.
• Declining development of the publishing market.
• Market saturation.
• Introduction of digital publishing methods
• Enhancement of science and technology.
The transformation of the macro markets have raised a number of concerns 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 utilized to strive for the future development unceasingly? How could the company sustain its long term competitive position in future?
Colgate Palmolive Company Case Study Analysis has certain strengths that can be made use of to decrease the hazards, conquer the weakness and avail the chances. Strengths of CMP are given as follows;
• The long term experience of Colgate Palmolive Company Case Study Solution in the publishing market i.e. 60 years allows the company to supply high quality products at a lower cost utilizing its prior experiences.
• The technical resources and capabilities created by its effective journey provide a competitive advantage to CMP.
• Vast product portfolioof CMP assists it to diversify its threat and supply high worth to its clients.
• Strong monetary position permits the company to think about several advancement opportunities with no worry of raising fund externally.
Along with the strengths, the company has certain weak points which might increase constraints for the business in implementing its advancement program. The weak points of Colgate Palmolive Company Case Study Solution are offered as follows;
• Despite of being a science and technology publishing firm, the company 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 should propose specific expansion strategies to avoid its reliance over the Chinese markets to accomplish long term growth.
Although, the development of the publishing market is declining since 2008, impacting Colgate Palmolive Company Case Study Analysis as well, but the development might be revived by availing certain opportunities presented in the market. The marketplace chances for CMP consist of;
• The company could likewise introduce Digital Publishing by using its long term technical experience and a strong consumer acknowledgment in the market.
• CMP might think about a development program through the expansion towards foreign markets in order to reduce its dependence over Chinese markets by utilizing its vast funds.
The changing macro patterns in the market and increasing competitors in the publishing market has positioned particular dangers to Colgate Palmolive Company Case Study Solution including;( Gurel, 2017).
• Introduction of digital publishing i.e. virtual libraries might cause decreasing market share of Colgate Palmolive Company Case Study Solution due to the consumer shift towards virtual libraries.
• The presence of a great deal of competitors in the publishing industry increase the danger for CMP to lose its competitive position in the market, as rivals can gain a strong consumer base by using particular strategies like aggressive promo, quality items, and so on
• Entryway of new publishing companies in the industry together with existence of high competition increases the hazard of losing the client base.
Due to absence of data, the financial ratios of CMP could not be computed. It might be examined from the Appendix III that the annual overall revenues of Colgate Palmolive Company Case Study Analysis during the period 2000-2012 are growing at a high development rate, revealing that the annual demand of the products of CMP is growing and the company is quite efficient in bring in a big number of clients at a prospective price.
Together with it, the 2nd chart which reveals the yearly growth in the Colgate Palmolive Company Case Study Analysis overall possessions, shows that the company is rather efficient in adding value to its possessions through its profits. The development in possessions reveals that the total value of the firm is also increasing with increasing the overall revenues. (Unknown, 2013).
Another monetary analysis of the company using the given information could be the analysis regarding the distribution of overall revenues of the business. Huge part of the incomes 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 company sections with a prospective growth to accomplish its future development goal.
PESTEL analysis could be performed to discover the different external forces impacting the efficiency of the business and the recent patterns in the external environment of the company. A short PESTEL analysis of the company is offered as follows; (Alanzi, 2018).
As the publishing sector could have a significant impact on the mindset of individuals about the communist ideology of the federal government, therefore, the publishing sector is highly supervised and guided by the Promotion Department of the Communist Party of China. Therefore, it might be stated that the overall political forces impacting Colgate Palmolive Company Case Study Solution business are high. The government policies concerning the publishing sector are also increasing with the passage of time.
Economic forces impacting the publishing sector in basic and the CMP in specific includesthe costs of paper, the income level of customers, the inflation rate, and the general GDP development of the country. All these forces integrate effect the demand for the publishing market.
Social and Demographical.
The customer preferences are moving towards digital publishing rather than the conventional was of publishing. In this regard, CMP should focus on digital publishing to meet the altering customer choices.
Technological forces affecting the CMP consist of the technological development in the reading techniques etc. Improvement of science and innovation in addition to the rise of digital publishing might minimize the need for the CMP items, if specific actions would not be taken quickly.
Ecological forces affecting Colgate Palmolive Company Case Study Solution consists of the issues of environmental communities over the usage of paper in publishing books. The paper used in the books while publishing is required to be non reusable and the ink utilized while publishing ought to not be harmful for the environment.
Legal regulations for the publishing sector at whole are high. The legal regulations relating to the publishing sector is controlled by the General Administration of Press and Publication. Publishing Regulation 1997 requires the publishers to be approved initially by the Federal government to be entered in the publishing market. The ordinance prohibits direct participation of foreign entities and people in the publishing sector.
Market Analysis (Porter's 5 Forces Model).
Porter's 5 Forces Design could be utilized to analyze the beauty of the publishing market China. A quick analysis of the Porter's 5 Forces is provided as follows;.
Threat of New Entrants.
Risks of new entrants in the Chinese Publishing Market is moderate. The prospective development in the industry tends to attract brand-new entrants to the publishing market. Nevertheless, the presence of extreme competition and the requirement of huge capital tends to demotivate brand-new entrants to go into in the market.
Threat of Replacement.
Danger of Replacement is high for the Chinese Publishing Industry. The replacement items for the released documents is the files presented in the virtual libraries on particular sites. The altering consumer choices towards digital knowing increase the threat of substitution for the industry.
Competitive competition in the publishing market is high. The existence of large number of customers in the Chinese Publishing Industry like CIP, PTP etc. tends to produce high competitive rivalry for CMP. Along with it, brand-new entrants are also participating in the market increasing the competitors for CMP.
Bargaining Power of Supplier.
The significant suppliers of the Colgate Palmolive Company Case Study Analysis include the providers 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 Purchaser.
Bargaining power of purchaser 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 purchasers requires high quality documents at competitive rates.
CMP operates in a highly competitive industry with the existence of a great deal of rivals. Nevertheless, the company has a competitive position in the market with the highest market share in the Chinese publishing market. Significant rivals of Colgate Palmolive Company Case Study Solution consist of;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIPis among the close rivals of CMP. Founded in the exact same period, CIP releases similar type of books. For a large time period, CIP held the biggest market share, and still ranks 3rd and second in various market sectors, with a significant focus on academic publications. CIP serves as a danger for CMP as it could wean its market share due to its long term competitive background. CIP is concentrated on digital publishing and might wean the marketplace share of Colgate Palmolive Company Case Study Analysis quickly in the present market situation.
Posts and telecommunication Press (PTP).
Another close rival of CMP is PTP. It was also established in the exact same duration as CMP and CIP. It ranks 6th in the state-owned publishers in terms of business scale. It is likewise one of the popular gamers 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 variety of Customers
• Development opportunities.
• Preventing the effect of market saturation in the Chinese publishing industry.
• Use of possible resources in growth.
• Threat of failure in brand-new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
• Sustaining customer base.
• Approaching new markets.
• Easy to present using present capabilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased item portfolio provides high value to customers.
• Competition in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core organisation segments to the new one can lead the company to lose need of its products in the market.
With the deep analysis of the external and internal environment of the business along with the industry analysis and the rival analysis, Alternative 2 is recommended to CMP to achieve its future development. As the preferences are shifting towards digital publishing and the business need an instant solution to prevent the declining market development. For that reason, introduction of digital publishing might show to be an instant option with low quantity of threat for the business. The business might also consider the expansion program after the success of its digital publishing program.
In order to introduce digital publishing in its item portfolio, the business needs to initially collects the information related to the consumer demand, the potential markets, the government regulations and the data related to the rivals presented in the market. If the preliminary offering shows a success, the business must go for the other markets. In this way the business would be able to implement its digital publishing program.
Although, the development of the publishing industry is declining since 2008, showing a hazard to the business's long term presence, but the situation can be controlled by considering an advancement plan in the future. The business might think about introducing digital publishingin its existing market to implement its advancement program at immediate basis and to avoid the threat of failure for entrance in the brand-new markets.