Cumberland Worldwide Corporation 2 Case Study Solution and Analysis
Cumberland Worldwide Corporation 2 Case Study Solution is the largest publishing business with a highest market share in the China's book retail market. CMP has ended up being a specialized information supplier and a large detailed Science and Technology publishing company through the combination of print media, audio-visual media and the network media.
CMP has actually spent its 60 years journey efficiently, being a successful publishing house, however, the changing macro market patterns and forces bring certain difficulties to the publishing industry in basic and Cumberland Worldwide Corporation 2 Case Study Help in specific. These aspects consist of;
• Entrance of the new publishing firms in the market.
• Decreasing development of the publishing market.
• Market saturation.
• Intro of digital publishing methods
• Enhancement of science and technology.
The change of the macro markets have raised several 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 capabilities of the company could be utilized to strive for the future development unceasingly? How could the business sustain its long term competitive position in future?
Cumberland Worldwide Corporation 2 Case Study Help has specific strengths that can be made use of to reduce the hazards, overcome the weakness and obtain the chances. Strengths of CMP are provided as follows;
• The long term experience of Cumberland Worldwide Corporation 2 Case Study Help in the publishing market i.e. 60 years allows the business to supply high quality products at a lower expense using its previous experiences.
• The technical resources and capabilities produced by its successful journey offer a competitive advantage to CMP.
• Vast item portfolioof CMP assists it to diversify its danger and provide high value to its consumers.
• Strong financial position permits the company to think about a number of advancement chances without any fear of raising fund externally.
Along with the strengths, the business has certain weaknesses which could increase constraints for the business in executing its development program. The weaknesses of Cumberland Worldwide Corporation 2 Case Study Help are offered as follows;
• Despite of being a science and technology publishing firm, the business still has standard ways ofpublishing which are not compatible with the growing technological shift.
• CMP extremely relies over the Chinese markets for its development. It must propose particular expansion plans to avoid its dependence over the Chinese markets to accomplish long term development.
The development of the publishing market is declining since 2008, affecting Cumberland Worldwide Corporation 2 Case Study Solution as well, however the growth might be revived by availing specific chances provided in the market. The market opportunities for CMP consist of;
• The business could likewise present Digital Publishing by utilizing its long term technical experience and a strong client recognition in the market.
• CMP might think about a development program through the growth towards foreign markets in order to minimize its dependence over Chinese markets by using its huge funds.
The altering macro patterns in the market and increasing competition in the publishing industry has presented certain risks to Cumberland Worldwide Corporation 2 Case Study Solution including;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries might lead to declining market share of Cumberland Worldwide Corporation 2 Case Study Help due to the consumer shift towards digital libraries.
• The presence 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 customer base by utilizing specific techniques like aggressive promo, quality products, etc.
• Entrance of brand-new publishing firms in the market in addition to presence of high competitors increases the threat of losing the client base.
Due to lack of data, the financial ratios of CMP could not be determined. It could be analyzed from the Appendix III that the yearly total incomes of Cumberland Worldwide Corporation 2 Case Study Analysis throughout the period 2000-2012 are growing at a high development rate, revealing that the yearly demand of the products of CMP is growing and the company is rather effective in attracting a big number of consumers at a potential price.
Together with it, the second chart which shows the annual growth in the Cumberland Worldwide Corporation 2 Case Study Help overall possessions, reveals that the company is quite effective in including value to its properties through its incomes. The growth in properties reveals that the overall worth of the company is likewise increasing with increasing the total incomes. (Unknown, 2013).
Another financial analysis of the company using the offered information could be the analysis relating to the distribution of total incomes of the business. 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 business could move towards other organisation sectors with a possible development to attain its future advancement objective.
PESTEL analysis could be performed to learn the numerous external forces impacting the efficiency of the company and the recent trends in the external environment of the business. A brief PESTEL analysis of the business is provided as follows; (Alanzi, 2018).
As the publishing sector could have a significant influence on the frame of mind of the people about the communist ideology of the federal government, for that reason, the publishing sector is highly supervised and guided by the Publicity Department of the Communist Party of China. Therefore, it could be stated that the total political forces impacting Cumberland Worldwide Corporation 2 Case Study Help business are high. The federal government policies regarding the publishing sector are also increasing with the passage of time.
Financial forces impacting the publishing sector in basic and the CMP in particular includesthe rates of paper, the income level of customers, the inflation rate, and the general GDP growth of the nation. All these forces integrate effect the need for the publishing market.
Social and Demographical.
Social and demographical forces consist of the population growth, the customer's preferences towards reading useful materials and so on. China has the highest population in the world with a high population development, revealing the increasing number of customers of the Cumberland Worldwide Corporation 2 Case Study Solution. 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 fulfill the altering consumer preferences.
Technological forces affecting the CMP consist of the technological development in the reading techniques and so on. Enhancement of science and technology in addition to the increase of digital publishing could decrease the need for the CMP items, if specific actions would not be taken soon.
Environmental forces impacting Cumberland Worldwide Corporation 2 Case Study Help includes the issues of environmental communities over the usage of paper in publishing books. The paper used in the books while publishing is needed to be non reusable and the ink used while publishing must not be hazardous for the environment.
Legal guidelines for the publishing sector at whole are high. The legal policies relating to the publishing sector is managed by the General Administration of Press and Publication. Publishing Ordinance 1997 requires the publishers to be approved initially by the Federal government to be gone into in the publishing market. The regulation forbids direct participation of foreign entities and people in the publishing sector.
Market Analysis (Porter's 5 Forces Model).
Porter's Five Forces Design could be used to analyze the attractiveness of the publishing industry China. A short analysis of the Porter's 5 Forces is provided as follows;.
Hazard of New Entrants.
Threats of new entrants in the Chinese Publishing Market is moderate. The possible growth in the industry tends to attract brand-new entrants to the publishing industry. However, the existence of extreme competition and the requirement of substantial capital tends to demotivate new entrants to go into in the marketplace.
Threat of Replacement.
Danger of Replacement is high for the Chinese Publishing Industry. The substitute items for the released files is the documents provided in the virtual libraries on specific websites. The altering customer choices towards digital learning increase the hazard of substitution for the market.
Competitive rivalry in the publishing market is high. The presence of large number of customers in the Chinese Publishing Industry like CIP, PTP and so on tends to produce high competitive rivalry for CMP. Along with it, new entrants are likewise participating in the market increasing the competitors for CMP.
Bargaining Power of Provider.
The major providers of the Cumberland Worldwide Corporation 2 Case Study Help include the providers of the paper for publishing files. As CMP is the biggest publisher in the Chinese Publishing Market, for that reason the overall bargaining power of provider for CMP is low.
Bargaining Power of Purchaser.
Haggling 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 marketplace saturation, the purchasers requires high quality documents at competitive costs.
CMP operates in an extremely competitive industry with the presence of a great deal of competitors. Nevertheless, the company has a competitive position in the market with the highest market share in the Chinese publishing market. Significant rivals of Cumberland Worldwide Corporation 2 Case Study Analysis include;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIP acts 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 could wean the market share of CMP easily in the existing market scenario.
Posts and telecommunication Press (PTP).
Another close rival of CMP is PTP. It was likewise founded in the exact same period as CMP and CIP. It ranks 6th in the state-owned publishers in regards to organisation scale. It is also one of the popular players in the publishing industry with an annual total revenues of RMB 550 million in 2010.
Alternative-1: Expand towards New Markets
• Minimizing dependence over the Chinese markets.
• Increasing variety of Customers
• Development opportunities.
• Avoiding the effect of market saturation in the Chinese publishing industry.
• Use of possible resources in expansion.
• Risk of failure in new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
• Sustaining customer base.
• Approaching brand-new markets.
• Easy to present utilizing current capabilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased item portfolio offers high value to clients.
• Competition in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core company sections to the new one can lead the business to lose demand of its items in the market.
As the preferences are shifting towards digital publishing and the company need an instant service to prevent the decreasing market development. The company might also consider the growth program after the success of its digital publishing program.
In order to introduce digital publishing in its item portfolio, the company needs to first gathers the data related to the customer demand, the possible markets, the federal government regulations and the data related to the competitors provided in the market. If the preliminary offering proves a success, the company ought to go for the other markets. In this method the business would be able to execute its digital publishing program.
Although, the growth of the publishing industry is decreasing because 2008, revealing a risk to the business's long term presence, however the situation can be managed by considering an advancement plan in the future. The business might think about presenting digital publishingin its existing market to execute its advancement program at immediate basis and to prevent the risk of failure for entryway in the new markets.