Dragon Soup And Earnings Management B Case Study Solution and Analysis
Dragon Soup And Earnings Management B Case Study Help 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 details service provider and a large extensive Science and Technology publishing business through the combination of print media, audio-visual media and the network media.
Although, Dragon Soup And Earnings Management B Case Study Analysis has actually invested its 60 years journey smoothly, being a successful publishing house, however, the altering macro market patterns and forces bring specific obstacles to the publishing market in basic and CMP in particular. These factors consist of;
• Entrance of the new publishing companies in the industry.
• Declining growth of the publishing market.
• Market saturation.
• Intro of digital publishing methods
• Enhancement of science and technology.
The improvement 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 abilities of the business could be used to pursue the future development unceasingly? How could the company sustain its long term competitive position in future?
Dragon Soup And Earnings Management B Case Study Help has particular strengths that can be made use of to reduce the dangers, conquer the weak point and avail the opportunities. Strengths of CMP are offered as follows;
• The long term experience of Dragon Soup And Earnings Management B Case Study Help in the publishing industry i.e. 60 years enables the company to offer high quality products at a lower cost using its previous experiences.
• The technical resources and abilities produced by its successful journey provide a competitive benefit to CMP.
• Large item portfolioof CMP assists it to diversify its danger and offer high value to its consumers.
• Strong monetary position enables the company to think about a number of development opportunities with no worry of raising fund externally.
Along with the strengths, the company has particular weak points which could increase restrictions for the business in implementing its advancement program. The weak points of Dragon Soup And Earnings Management B Case Study Help are provided as follows;
• Despite of being a science and innovation publishing company, the business still has standard ways ofpublishing which are not suitable with the growing technological shift.
• CMP extremely relies over the Chinese markets for its development. It ought to propose certain growth plans to prevent its dependence over the Chinese markets to accomplish long term development.
The development of the publishing industry is decreasing because 2008, impacting Dragon Soup And Earnings Management B Case Study Help as well, but the development could be restored by availing specific opportunities presented in the market. The market opportunities for CMP include;
• The company could likewise introduce Digital Publishing by using its long term technical experience and a strong client acknowledgment in the market.
• CMP might consider a development program through the growth towards foreign markets in order to minimize its dependence over Chinese markets by using its large funds.
The altering macro trends in the market and increasing competitors in the publishing industry has posed specific dangers to Dragon Soup And Earnings Management B Case Study Analysis including;( Gurel, 2017).
• Introduction of digital publishing i.e. virtual libraries could result in decreasing market share of Dragon Soup And Earnings Management B Case Study Analysis due to the consumer shift towards digital libraries.
• The existence of a great deal of competitors in the publishing industry increase the threat for CMP to lose its competitive position in the market, as competitors can get a strong consumer base by utilizing certain methods like aggressive promotion, quality products, etc.
• Entryway of brand-new publishing companies in the market along with existence of high competitors increases the danger of losing the client base.
Due to lack of information, the monetary ratios of CMP could not be calculated. It might be evaluated from the Appendix III that the annual total earnings of Dragon Soup And Earnings Management B Case Study Help during the duration 2000-2012 are growing at a high growth rate, showing that the yearly demand of the products of CMP is growing and the company is quite efficient in bring in a big number of consumers at a potential price.
In addition to it, the second chart which reveals the yearly growth in the Dragon Soup And Earnings Management B Case Study Analysis overall properties, reveals that the company is quite efficient in including value to its properties through its revenues. The development in assets shows that the overall worth of the firm is likewise increasing with increasing the overall profits. (Unidentified, 2013).
Another monetary analysis of the company using the provided information might be the analysis regarding the circulation of total revenues of the business. Major part of the profits of CMP originates from the sales of its published books i.e. 64% as shown in the Case Appendix V. The business could move towards other business sections with a possible growth to achieve its future advancement goal.
PESTEL analysis might be conducted to find out the numerous external forces affecting the performance of the business and the recent patterns in the external environment of the business. A quick PESTEL analysis of the business is given as follows; (Alanzi, 2018).
As the publishing sector might have a substantial impact on the state of mind of the people about the communist ideology of the government, therefore, the publishing sector is extremely supervised and assisted by the Publicity Department of the Communist Party of China. It might be stated that the total political forces impacting CMP service are high. The government policies concerning the publishing sector are also increasing with the passage of time.
Financial forces impacting the publishing sector in basic and the Dragon Soup And Earnings Management B Case Study Help in specific includesthe costs of paper, the earnings level of customers, the inflation rate, and the overall GDP development of the nation. All these forces combine impact the need for the publishing market. In addition to it, the economic policies related to the import of books affect the general service at CPM. Nevertheless, China's financial conditions are rather favorable for CMP with high GDP growth and consumer earnings level.
Social and Demographical.
The consumer choices are moving towards digital publishing rather than the traditional was of publishing. In this regard, CMP should focus on digital publishing to satisfy the changing customer preferences.
Technological forces impacting the CMP include the technological advancement in the reading strategies etc. Improvement of science and innovation along with the increase of digital publishing might minimize the need for the CMP items, if particular actions would not be taken soon.
Ecological forces impacting Dragon Soup And Earnings Management B Case Study Help consists of the concerns of ecological communities over the usage of paper in publishing books. The paper utilized in the books while publishing is required to be non reusable and the ink utilized while publishing should not be damaging for the environment.
Legal regulations for the publishing sector at whole are high. Publishing Ordinance 1997 needs the publishers to be authorized initially by the Government to be gone into in the publishing market.
Market Analysis (Porter's Five Forces Design).
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.
Hazards of brand-new entrants in the Chinese Publishing Market is moderate. The prospective growth in the market tends to bring in new entrants to the publishing industry. However, the existence of extreme competitors and the requirement of substantial capital tends to demotivate new entrants to enter in the market.
Danger of Substitution.
Danger of Alternative is high for the Chinese Publishing Market. The alternative products for the released files is the documents presented in the digital libraries on particular sites. The altering customer preferences towards digital knowing increase the danger of alternative for the market.
Competitive competition in the publishing industry is high. The existence of large number of consumers in the Chinese Publishing Market like CIP, PTP and so on tends to produce high competitive competition for CMP. Along with it, new entrants are also entering into the market increasing the competitors for CMP.
Bargaining Power of Supplier.
The significant providers of the Dragon Soup And Earnings Management B Case Study Analysis include the providers of the paper for publishing files. As CMP is the largest publisher in the Chinese Publishing Market, for that reason the total bargaining power of supplier for CMP is low.
Bargaining Power of Purchaser.
Negotiating power of buyer in the publishing industry is high. Due to the existence of a large number of publishers in the Chinese market and the market saturation, the purchasers needs high quality documents at competitive rates.
CMP runs in an extremely competitive industry with the presence of a great deal of rivals. Nevertheless, the business has a competitive position in the market with the highest market share in the Chinese publishing market. Significant rivals of Dragon Soup And Earnings Management B Case Study Help include;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIPis one of the close rivals of CMP. Established in the very same duration, CIP releases similar kind of books. For a big period, CIP held the largest market share, and still ranks second and third in various market sections, with a significant focus on academic publications. CIP acts as a hazard for CMP as it might wean its market share due to its long term competitive background. CIP is concentrated on digital publishing and could wean the marketplace share of Dragon Soup And Earnings Management B Case Study Solution quickly in the current market situation.
Posts and telecommunication Press (PTP).
It was also founded in the same period as Dragon Soup And Earnings Management B Case Study Solution and CIP. It is also one of the prominent players in the publishing industry with a yearly total earnings of RMB 550 million in 2010.
Alternative-1: Broaden towards New Markets
• Decreasing reliance over the Chinese markets.
• Increasing variety of Customers
• Development chances.
• Preventing the effect of market saturation in the Chinese publishing industry.
• Use of prospective resources in expansion.
• Danger of failure in new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
• Sustaining consumer base.
• Approaching new markets.
• Easy to introduce utilizing present abilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased item 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 business to lose demand of its items in the market.
As the choices are moving towards digital publishing and the business need an instant option to prevent the declining market growth. The business could also consider the expansion program after the success of its digital publishing program.
In order to present digital publishing in its item portfolio, the business must initially gathers the data related to the consumer demand, the prospective markets, the government guidelines and the data related to the competitors presented 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 given that 2008, showing a threat to the company's long term presence, but the situation can be managed by considering a development plan in the future. The company might think about introducing digital publishingin its existing market to implement its advancement program at immediate basis and to prevent the risk of failure for entryway in the brand-new markets.