Cost Accounting For Astel Computers Case Study Solution and Analysis
Cost Accounting For Astel Computers Case Study Analysis is the largest publishing business with a highest market share in the China's book retail market. CMP has actually ended up being a specialized info service provider and a large thorough Science and Innovation publishing business through the integration of print media, audio-visual media and the network media.
CMP has spent its 60 years journey efficiently, being a successful publishing house, however, the altering macro market trends and forces bring particular difficulties to the publishing industry in general and Cost Accounting For Astel Computers Case Study Help in specific. These aspects include;
• Entrance of the brand-new publishing firms in the market.
• Declining development of the publishing market.
• Market saturation.
• Introduction of digital publishing strategies
• Enhancement of science and innovation.
The transformation of the macro markets have raised numerous 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 capabilities of the company could be made use of to pursue the future development unceasingly? How could the company sustain its long term competitive position in future?
Cost Accounting For Astel Computers Case Study Analysis has certain strengths that can be made use of to minimize the hazards, conquer the weakness and obtain the opportunities. Strengths of CMP are provided as follows;
• The long term experience of Cost Accounting For Astel Computers Case Study Solution in the publishing market i.e. 60 years enables the company to supply high quality products at a lower cost utilizing its previous experiences.
• The technical resources and abilities produced by its effective journey offer a competitive advantage to CMP.
• Vast product portfolioof CMP helps it to diversify its threat and offer high worth to its clients.
• Strong monetary position allows the company to consider numerous advancement chances without any worry of raising fund externally.
Along with the strengths, the business has certain weaknesses which might increase constraints for the company in implementing its advancement program. The weaknesses of Cost Accounting For Astel Computers Case Study Help are offered as follows;
• Despite of being a science and innovation publishing company, the company still has conventional methods ofpublishing which are not compatible with the growing technological shift.
• CMP extremely relies over the Chinese markets for its development. It ought to propose particular growth strategies to prevent its reliance over the Chinese markets to achieve long term growth.
The development of the publishing market is declining because 2008, affecting Cost Accounting For Astel Computers Case Study Help as well, however the growth could be revived by availing particular chances presented in the market. The market chances for CMP consist of;
• The company might likewise present Digital Publishing by utilizing its long term technical experience and a strong consumer acknowledgment in the market.
• CMP could consider an advancement program through the growth towards foreign markets in order to lower its reliance over Chinese markets by using its large funds.
The altering macro trends in the market and increasing competitors in the publishing industry has actually positioned specific risks to Cost Accounting For Astel Computers Case Study Solution consisting of;( Gurel, 2017).
• Introduction of digital publishing i.e. digital libraries might lead to declining market share of Cost Accounting For Astel Computers Case Study Solution due to the customer shift towards digital libraries.
• The existence of large number of rivals in the publishing market increase the danger for CMP to lose its competitive position in the market, as competitors can get a strong customer base by utilizing specific methods like aggressive promo, quality items, etc.
• Entryway of brand-new publishing firms in the industry along with existence of high competitors increases the risk of losing the consumer base.
Due to absence of data, the monetary ratios of CMP could not be determined. It could be evaluated from the Appendix III that the annual total revenues of Cost Accounting For Astel Computers Case Study Solution throughout the duration 2000-2012 are growing at a high development rate, showing that the annual need of the items of CMP is growing and the business is quite efficient in bring in a big number of consumers at a potential cost.
Along with it, the 2nd chart which shows the annual development in the Cost Accounting For Astel Computers Case Study Help overall assets, shows that the business is quite effective in including value to its assets through its profits. The development in assets reveals that the total worth of the firm is also increasing with increasing the overall earnings. (Unknown, 2013).
Another financial analysis of the business using the offered information could be the analysis regarding the distribution of total revenues of the company. Huge part of the revenues of CMP originates from the sales of its released books i.e. 64% as displayed in the Case Appendix V. The company could move towards other company sections with a potential development to achieve its future advancement goal.
PESTEL analysis might be performed to discover the numerous external forces affecting the performance of the business and the current trends in the external environment of the company. A brief PESTEL analysis of the business is provided as follows; (Alanzi, 2018).
As the publishing sector might have a considerable 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 assisted by the Promotion Department of the Communist Celebration of China. It could be said that the total political forces affecting CMP service are high. The federal government policies relating to the publishing sector are likewise increasing with the passage of time.
Financial forces impacting the publishing sector in general and the Cost Accounting For Astel Computers Case Study Help in particular includesthe prices of paper, the earnings level of customers, the inflation rate, and the overall GDP development of the nation. All these forces integrate effect the need for the publishing market. Together with it, the economic policies associated with the import of books affect the general company at CPM. Nevertheless, China's financial conditions are rather beneficial for CMP with high GDP development and consumer income level.
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 altering customer preferences.
Technological forces impacting the CMP consist of the technological improvement in the reading strategies and so on. Improvement of science and innovation along with the increase of digital publishing could lower the demand for the CMP items, if specific actions would not be taken quickly.
Environmental forces impacting Cost Accounting For Astel Computers Case Study Solution consists of the issues of environmental neighborhoods 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 used while publishing needs to not be hazardous for the environment.
Legal policies for the publishing sector at whole are high. Publishing Regulation 1997 requires the publishers to be authorized first by the Federal government to be entered in the publishing market.
Market Analysis (Porter's Five Forces Model).
Porter's 5 Forces Design could be utilized to analyze the attractiveness of the publishing industry China. A quick analysis of the Porter's 5 Forces is given as follows;.
Danger of New Entrants.
Dangers of new entrants in the Chinese Publishing Market is moderate. The potential growth in the market tends to attract brand-new entrants to the publishing industry. The existence of extreme competitors and the requirement of substantial capital tends to demotivate new entrants to enter in the market.
Hazard of Replacement.
Danger of Replacement is high for the Chinese Publishing Industry. The replacement items for the published documents is the files presented in the digital libraries on particular websites. The altering customer preferences towards digital learning increase the threat of alternative for the market.
Competitive rivalry in the publishing market is high. The presence of a great deal of consumers in the Chinese Publishing Market like CIP, PTP and so on tends to produce high competitive rivalry for CMP. Together with it, brand-new entrants are likewise entering into the marketplace increasing the competitors for CMP.
Bargaining Power of Provider.
The major providers of the Cost Accounting For Astel Computers Case Study Solution include the suppliers of the paper for releasing files. As CMP is the biggest publisher in the Chinese Publishing Market, therefore the general bargaining power of provider for CMP is low.
Bargaining Power of Purchaser.
Bargaining power of purchaser in the publishing industry is high. Due to the presence of a large number of publishers in the Chinese market and the marketplace saturation, the purchasers needs high quality documents at competitive costs.
CMP runs in an extremely competitive market with the presence of large number of competitors. The company has a competitive position in the market with the greatest market share in the Chinese publishing market. Significant competitors of Cost Accounting For Astel Computers Case Study Solution consist of;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIPis among the close rivals of CMP. Founded in the very same period, CIP publishes comparable kind of books. For a big period, CIP held the biggest market share, and still ranks third and second in different market segments, with a significant concentrate on instructional publications. CIP functions as a danger 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 Cost Accounting For Astel Computers Case Study Solution quickly in the existing market situation.
Posts and telecommunication Press (PTP).
Another close rival of CMP is PTP. It was likewise established in the very same period as CMP and CIP. It ranks 6th in the state-owned publishers in regards to company scale. It is also among the popular players in the publishing market with an annual total revenues of RMB 550 million in 2010.
Alternative-1: Broaden towards New Markets
• Reducing dependence over the Chinese markets.
• Increasing number of Clients
• Growth chances.
• Preventing the impact of market saturation in the Chinese publishing industry.
• Use of potential resources in expansion.
• Risk of failure in brand-new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
• Sustaining consumer base.
• Approaching brand-new markets.
• Easy to introduce utilizing existing abilities.
• Low risk of Failure.
• Low requirement for funds.
• Increased product portfolio provides high worth to clients.
• Competitors in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core business sectors to the brand-new one can lead the company to lose need of its products in the market.
With the deep analysis of the internal and external environment of the business in addition to the market analysis and the rival analysis, Alternative 2 is advised to CMP to accomplish its future development. As the preferences are moving towards digital publishing and the business require an immediate solution to avoid the decreasing market development. Intro of digital publishing could prove to be an instant option with low amount of risk for the business. Nevertheless, the company could likewise consider the expansion program after the success of its digital publishing program.
In order to introduce digital publishing in its product portfolio, the business ought to initially gathers the data related to the customer demand, the potential markets, the federal government regulations and the information related to the competitors presented in the market. If the preliminary offering proves a success, the business needs to go for the other markets. In this method the company would be able to implement its digital publishing program.
Although, the growth of the publishing market is declining since 2008, revealing a danger to the business's long term presence, however the situation can be managed by considering a development plan in the future. The company could consider 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.