Cumberland Worldwide Corporation A Case Study Solution and Analysis
Intro
Cumberland Worldwide Corporation A Case Study Help is the largest publishing company with a highest market share in the China's book retail market. CMP has actually ended up being a specialized info company and a large extensive Science and Innovation publishing business through the combination of print media, audio-visual media and the network media.
Critical Issues
CMP has actually spent its 60 years journey efficiently, being an effective publishing house, however, the changing macro market patterns and forces bring particular challenges to the publishing market in general and Cumberland Worldwide Corporation A Case Study Analysis in particular. These elements consist of;
• Entryway of the brand-new publishing companies in the market.
• Decreasing development of the publishing market.
• Market saturation.
• Introduction of digital publishing techniques
• Improvement of science and innovation.
The transformation 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 valuable experience, technical resources and the abilities of the business could be used to strive for the future advancement unceasingly? How could the company sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Cumberland Worldwide Corporation A Case Study Analysis has specific strengths that can be used to lower the dangers, get rid of the weak point and get the chances. Strengths of CMP are offered as follows;
• The long term experience of Cumberland Worldwide Corporation A Case Study Analysis in the publishing market i.e. 60 years permits the company to offer high quality products at a lower expense utilizing its prior experiences.
• The technical resources and abilities generated by its successful journey offer a competitive benefit to CMP.
• Large product portfolioof CMP assists it to diversify its threat and supply high worth to its clients.
• Strong monetary position allows the business to think about numerous advancement opportunities without any worry of raising fund externally.
Weak points
Together with the strengths, the company has certain weaknesses which might increase restraints for the company in executing its advancement program. The weak points of Cumberland Worldwide Corporation A Case Study Analysis are provided as follows;
• Despite of being a science and innovation publishing firm, the business still has traditional methods ofpublishing which are not compatible with the growing technological shift.
• CMP highly relies over the Chinese markets for its development. It must propose particular growth plans to prevent its dependence over the Chinese markets to achieve long term growth.
Opportunities
Although, the development of the publishing industry is decreasing considering that 2008, affecting Cumberland Worldwide Corporation A Case Study Solution also, but the development could be restored by availing particular opportunities presented in the market. The market chances for CMP consist of;
• The business might likewise present Digital Publishing by using its long term technical experience and a strong client acknowledgment in the market.
• CMP could think about an advancement program through the expansion towards foreign markets in order to reduce its reliance over Chinese markets by utilizing its vast funds.
Dangers
The changing macro trends in the market and increasing competitors in the publishing industry has postured particular threats to Cumberland Worldwide Corporation A Case Study Help consisting of;( Gurel, 2017).
• Intro of digital publishing i.e. virtual libraries might result in declining market share of Cumberland Worldwide Corporation A Case Study Analysis due to the consumer shift towards digital libraries.
• The presence of large number of rivals in the publishing industry increase the hazard for CMP to lose its competitive position in the market, as rivals can acquire a strong customer base by utilizing specific strategies like aggressive promo, quality items, and so on
• Entrance of brand-new publishing companies in the industry in addition to presence of high competitors increases the threat of losing the customer base.
Monetary Analysis.
Due to lack of information, the monetary ratios of CMP could not be determined. It could be examined from the Appendix III that the yearly total earnings of Cumberland Worldwide Corporation A Case Study Help during the period 2000-2012 are growing at a high growth rate, revealing that the annual need of the products of CMP is growing and the business is quite effective in bring in a large number of clients at a prospective price.
Together with it, the 2nd chart which reveals the annual growth in the Cumberland Worldwide Corporation A Case Study Solution overall possessions, shows that the company is rather effective in adding value to its properties through its earnings. The development in assets reveals that the overall worth of the company is likewise increasing with increasing the overall earnings. (Unknown, 2013).
Another financial analysis of the company using the offered data might be the analysis regarding the distribution of overall revenues of the business. Huge part of the incomes of CMP originates from the sales of its published books i.e. 64% as displayed in the Case Appendix V. The business might move towards other organisation segments with a potential growth to attain its future advancement objective.
PESTEL Analysis
PESTEL analysis might be carried out to learn the different external forces impacting the performance of the business and the recent trends in the external environment of the company. A quick PESTEL analysis of the company is given as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a considerable impact on the frame of mind of the people about the communist ideology of the government, for that reason, the publishing sector is extremely monitored and guided by the Publicity Department of the Communist Party of China. Therefore, it could be said that the total political forces impacting Cumberland Worldwide Corporation A Case Study Solution business are high. The government policies regarding the publishing sector are also increasing with the passage of time.
Economical.
Economic forces affecting the publishing sector in basic and the CMP in particular includesthe costs of paper, the earnings level of consumers, the inflation rate, and the overall GDP growth of the country. All these forces combine impact the need for the publishing market.
Social and Demographical.
Social and demographical forces consist of the population growth, the customer's choices towards reading informative products and so on. China has the greatest population in the world with a high population growth, showing the increasing variety of consumers of the Cumberland Worldwide Corporation A Case Study Solution. The customer choices are moving towards digital publishing rather than the standard was of publishing. In this regard, CMP ought to focus on digital publishing to meet the altering customer preferences.
Technological.
Technological forces impacting the CMP include the technological development in the reading techniques etc. Enhancement of science and technology together with the rise of digital publishing could decrease the demand for the CMP products, if specific actions would not be taken soon.
Environmental.
Environmental forces impacting Cumberland Worldwide Corporation A Case Study Analysis consists of the issues of environmental neighborhoods over the usage of paper in publishing books. The paper utilized in the books while publishing is required to be disposable and the ink used while publishing should not be harmful for the environment.
Legal.
Legal regulations for the publishing sector at whole are high. The legal policies concerning the publishing sector is managed by the General Administration of Press and Publication. Publishing Regulation 1997 needs the publishers to be approved initially by the Federal government to be gone into in the publishing market. The regulation forbids direct involvement of foreign entities and people in the publishing sector.
Market Analysis (Porter's Five Forces Design).
Porter's Five Forces Design might be utilized to evaluate the attractiveness of the publishing industry China. A brief analysis of the Porter's Five Forces is provided as follows;.
Danger of New Entrants.
Threats of new entrants in the Chinese Publishing Market is moderate. The possible development in the industry tends to attract brand-new entrants to the publishing industry. Nevertheless, the existence of intense competitors and the requirement of huge capital tends to demotivate brand-new entrants to go into in the market.
Danger of Replacement.
Risk of Replacement is high for the Chinese Publishing Market. The substitute items for the released documents is the files presented in the virtual libraries on specific websites. The changing consumer choices towards digital learning increase the risk of substitution for the market.
Competitive Competition.
Competitive rivalry in the publishing industry is high. The existence of a great deal of customers in the Chinese Publishing Market like CIP, PTP and so on tends to produce high competitive rivalry for CMP. Along with it, new entrants are likewise participating in the marketplace increasing the competitors for CMP.
Bargaining Power of Supplier.
The major suppliers of the Cumberland Worldwide Corporation A Case Study Solution include the providers of the paper for releasing documents. As CMP is the largest publisher in the Chinese Publishing Market, therefore the overall bargaining power of supplier for CMP is low.
Bargaining Power of Purchaser.
Negotiating power of buyer in the publishing market is high. Due to the existence of a large number of publishers in the Chinese market and the marketplace saturation, the purchasers needs high quality files at competitive rates.
Rivals Analysis.
CMP runs in a highly competitive market with the existence of large number of competitors. The company has a competitive position in the market with the greatest market share in the Chinese publishing market. Major competitors of Cumberland Worldwide Corporation A Case Study Analysis consist of;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIP acts as a threat 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 quickly in the present market scenario.
Posts and telecommunication Press (PTP).
It was likewise established in the exact same period as Cumberland Worldwide Corporation A Case Study Solution and CIP. It is also one of the popular players in the publishing market with a yearly total profits of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Decreasing reliance over the Chinese markets.
• Increasing variety of Clients
• Development chances.
• Avoiding the effect of market saturation in the Chinese publishing market.
Cons
• Usage of prospective resources in expansion.
• Risk of failure in brand-new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
Pros
• Sustaining consumer base.
• Approaching brand-new markets.
• Easy to introduce using existing capabilities.
• Low risk of Failure.
• Low requirement for funds.
• Increased item portfolio provides high worth to consumers.
Cons
• Competition in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core service sectors to the new one can lead the company to lose demand of its items in the market.
Suggestions
With the deep analysis of the internal and external environment of the business together with the market analysis and the competitor analysis, Alternative 2 is recommended to CMP to achieve its future development. As the preferences are moving towards digital publishing and the business require an immediate option to prevent the decreasing industry growth. Intro of digital publishing might prove to be an instant solution with low amount of threat for the business. The company could also consider the expansion program after the success of its digital publishing program.
Implementation
In order to introduce digital publishing in its item portfolio, the business should first gathers the information related to the consumer demand, the possible markets, the government guidelines and the information related to the competitors presented in the market. If the initial offering shows a success, the business ought to go for the other markets. In this way the business would be able to execute its digital publishing program.
Conclusion
Although, the growth of the publishing market is declining considering that 2008, revealing a threat to the business's long term presence, but the circumstance can be managed by considering a development strategy in the future. The company could consider introducing digital publishingin its existing market to implement its advancement program at immediate basis and to prevent the threat of failure for entrance in the new markets.
