Cyclone Tire Company 2 Case Study Solution and Analysis
Intro
Cyclone Tire Company 2 Case Study Analysis is the biggest publishing business with a highest market share in the China's book retail market. CMP has actually become a specialized info supplier and a big extensive Science and Technology publishing company through the integration of print media, audio-visual media and the network media.
Important Concerns
CMP has invested its 60 years journey efficiently, being an effective publishing house, however, the altering macro market patterns and forces bring particular challenges to the publishing industry in general and Cyclone Tire Company 2 Case Study Help in specific. These factors consist of;
• Entryway of the brand-new publishing firms in the industry.
• Declining growth of the publishing market.
• Market saturation.
• Introduction of digital publishing techniques
• Enhancement of science and innovation.
The improvement 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 valuable experience, technical resources and the capabilities of the company could be made use of to strive for the future advancement unceasingly? How could the business sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Cyclone Tire Company 2 Case Study Help has certain strengths that can be used to decrease the risks, conquer the weakness and obtain the chances. Strengths of CMP are given as follows;
• The long term experience of Cyclone Tire Company 2 Case Study Help in the publishing market i.e. 60 years allows the business to offer high quality items at a lower expense using its previous experiences.
• The technical resources and abilities produced by its successful journey supply a competitive advantage to CMP.
• Vast item portfolioof CMP assists it to diversify its risk and offer high worth to its clients.
• Strong monetary position permits the business to consider numerous development opportunities without any worry of raising fund externally.
Weaknesses
Along with the strengths, the business has specific weaknesses which might increase restraints for the company in executing its development program. The weaknesses of Cyclone Tire Company 2 Case Study Solution are provided as follows;
• Despite of being a science and innovation publishing firm, the business still has standard ways ofpublishing which are not compatible with the growing technological shift.
• CMP highly relies over the Chinese markets for its development. It should propose specific expansion strategies to prevent its reliance over the Chinese markets to accomplish long term growth.
Opportunities
Although, the development of the publishing industry is declining given that 2008, impacting Cyclone Tire Company 2 Case Study Help also, but the development could be revived by availing particular opportunities provided in the market. The market opportunities for CMP consist of;
• The business could also introduce Digital Publishing by utilizing its long term technical experience and a strong customer acknowledgment in the market.
• CMP might think about a development program through the expansion towards foreign markets in order to decrease its dependence over Chinese markets by utilizing its large funds.
Risks
The changing macro patterns in the market and increasing competitors in the publishing industry has posed specific hazards to Cyclone Tire Company 2 Case Study Help including;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries might cause decreasing market share of Cyclone Tire Company 2 Case Study Analysis due to the consumer shift towards digital libraries.
• The presence of a great deal of rivals in the publishing industry increase the hazard for CMP to lose its competitive position in the market, as rivals can gain a strong customer base by using specific strategies like aggressive promotion, quality products, etc.
• Entrance of brand-new publishing companies in the industry together with presence of high competition increases the threat of losing the client base.
Financial Analysis.
Due to absence of information, the financial ratios of CMP could not be computed. It might be analyzed from the Appendix III that the annual total profits of Cyclone Tire Company 2 Case Study Solution throughout the duration 2000-2012 are growing at a high development rate, showing that the yearly demand of the items of CMP is growing and the business is quite effective in bring in a big number of customers at a possible price.
In addition to it, the second chart which shows the yearly development in the Cyclone Tire Company 2 Case Study Help overall possessions, reveals that the business is quite effective in including worth to its assets through its profits. The development in properties shows that the overall worth of the firm is also increasing with increasing the total incomes. (Unidentified, 2013).
Another monetary analysis of the business utilizing the offered data could be the analysis concerning the circulation of overall revenues of the company. Huge part of the incomes of CMP comes 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 growth to achieve its future advancement objective.
PESTEL Analysis
PESTEL analysis might be conducted to learn the different external forces affecting the efficiency of the company and the recent trends in the external environment of the business. A short PESTEL analysis of the company is given as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a considerable influence on the mindset of the people about the communist ideology of the federal government, therefore, the publishing sector is extremely supervised and directed by the Promotion Department of the Communist Celebration of China. It could be said that the total political forces impacting CMP business are high. The government policies relating to the publishing sector are also increasing with the passage of time.
Economical.
Financial forces impacting the publishing sector in basic and the CMP in specific includesthe prices of paper, the income level of customers, the inflation rate, and the total GDP development 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 consumer's preferences towards reading useful materials etc. China has the highest population in the world with a high population development, showing the increasing variety of consumers of the Cyclone Tire Company 2 Case Study Analysis. The customer preferences are shifting towards digital publishing rather than the standard was of publishing. In this regard, CMP should focus on digital publishing to fulfill the changing consumer preferences.
Technological.
Technological forces impacting the CMP consist of the technological development in the reading strategies etc. Enhancement of science and innovation in addition to the increase of digital publishing might lower the demand for the CMP products, if particular actions would not be taken soon.
Environmental.
Ecological forces impacting Cyclone Tire Company 2 Case Study Solution consists of the concerns of environmental communities over the usage of paper in publishing books. The paper utilized in the books while publishing is needed to be non reusable and the ink utilized while publishing should not be harmful for the environment.
Legal.
Legal guidelines for the publishing sector at whole are high. The legal guidelines regarding the publishing sector is managed by the General Administration of Press and Publication. Publishing Regulation 1997 needs the publishers to be authorized initially by the Federal government to be gone into in the publishing market. The ordinance prohibits direct involvement of foreign entities and individuals in the publishing sector.
Market Analysis (Porter's 5 Forces Model).
Porter's Five Forces Model might be used to evaluate the appearance of the publishing industry China. A quick analysis of the Porter's Five Forces is provided as follows;.
Risk of New Entrants.
Dangers of brand-new entrants in the Chinese Publishing Industry is moderate. The possible development in the industry tends to bring in brand-new entrants to the publishing market. However, the presence of extreme competition and the requirement of substantial capital tends to demotivate brand-new entrants to go into in the market.
Threat of Substitution.
Threat of Replacement is high for the Chinese Publishing Industry. The alternative products for the released files is the files provided in the virtual libraries on specific websites. The changing customer choices towards digital learning increase the danger of alternative for the market.
Competitive Rivalry.
Competitive rivalry in the publishing market is high. The presence of a great deal of consumers in the Chinese Publishing Industry like CIP, PTP etc. tends to produce high competitive rivalry for CMP. Together with it, brand-new entrants are likewise entering into the marketplace increasing the competition for CMP.
Bargaining Power of Provider.
The significant providers of the Cyclone Tire Company 2 Case Study Analysis include the providers of the paper for publishing files. As CMP is the biggest publisher in the Chinese Publishing Market, therefore the general bargaining power of supplier for CMP is low.
Bargaining Power of Purchaser.
Bargaining 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 market saturation, the buyers needs high quality documents at competitive costs.
Competitors Analysis.
CMP operates in a highly competitive market with the existence of large number of rivals. The company has a competitive position in the market with the greatest market share in the Chinese publishing market. Significant rivals of Cyclone Tire Company 2 Case Study Help include;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIP acts as a threat for CMP as it could 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 existing market scenario.
Posts and telecommunication Press (PTP).
It was likewise established in the same duration as Cyclone Tire Company 2 Case Study Solution and CIP. It is also one of the popular players in the publishing industry with a yearly total revenues of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Minimizing reliance over the Chinese markets.
• Increasing number of Clients
• Development opportunities.
• Preventing the impact of market saturation in the Chinese publishing market.
Cons
• Use of prospective resources in expansion.
• Risk of failure in brand-new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining customer base.
• Approaching new markets.
• Easy to present using current capabilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased item portfolio provides high value to clients.
Cons
• Competitors in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core company segments to the new one can lead the business to lose demand of its items in the market.
Suggestions
As the preferences are moving towards digital publishing and the business need an immediate service to avoid the declining industry development. The business might likewise consider the growth program after the success of its digital publishing program.
Execution
In order to introduce digital publishing in its item portfolio, the company needs to first collects the information related to the consumer demand, the possible markets, the government regulations and the data related to the competitors provided in the market. If the initial offering shows a success, the business should go for the other markets. In this way the company would be able to execute its digital publishing program.
Conclusion
Although, the growth of the publishing industry is declining since 2008, revealing a risk to the business's long term presence, but the situation can be managed by considering an advancement strategy in the future. The business could consider introducing digital publishingin its existing market to implement its development program at immediate basis and to prevent the risk of failure for entrance in the new markets.
