Ecg Group Fraud And Liquidation Of A Joint Venture In China Case Study Solution and Analysis
Intro
Ecg Group Fraud And Liquidation Of A Joint Venture In China Case Study Analysis is the biggest publishing business with a greatest market share in the China's book retail market. CMP has become a specialized details service provider and a large thorough Science and Technology publishing business through the combination of print media, audio-visual media and the network media.
Important Concerns
Although, Ecg Group Fraud And Liquidation Of A Joint Venture In China Case Study Solution has spent its 60 years journey efficiently, being a successful publishing home, nevertheless, the altering macro market patterns and forces bring particular obstacles to the publishing industry in basic and CMP in specific. These aspects include;
• Entrance of the brand-new publishing companies in the industry.
• Declining development of the publishing market.
• Market saturation.
• Introduction of digital publishing techniques
• Improvement of science and innovation.
The change of the macro markets have raised a number of questions to the management at CPM that what could be the future of CMP in this circumstance? Do the long valuable experience, technical resources and the capabilities of the company could be utilized to pursue the future advancement unceasingly? How could the company sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Ecg Group Fraud And Liquidation Of A Joint Venture In China Case Study Solution has particular strengths that can be utilized to minimize the risks, overcome the weak point and get the chances. Strengths of CMP are provided as follows;
• The long term experience of Ecg Group Fraud And Liquidation Of A Joint Venture In China Case Study Analysis in the publishing market i.e. 60 years allows the company to offer high quality products at a lower cost utilizing its previous experiences.
• The technical resources and capabilities produced by its successful journey supply a competitive advantage to CMP.
• Huge item portfolioof CMP helps it to diversify its risk and offer high value to its clients.
• Strong monetary position allows the company to think about numerous advancement opportunities with no fear of raising fund externally.
Weak points
In addition to the strengths, the company has particular weak points which might increase constraints for the company in implementing its advancement program. The weaknesses of Ecg Group Fraud And Liquidation Of A Joint Venture In China Case Study Help are given as follows;
• Despite of being a science and innovation publishing company, the business still has conventional methods ofpublishing which are not suitable with the growing technological shift.
• CMP extremely relies over the Chinese markets for its development. It should propose certain growth plans to avoid its reliance over the Chinese markets to attain long term development.
Opportunities
The development of the publishing market is declining since 2008, impacting Ecg Group Fraud And Liquidation Of A Joint Venture In China Case Study Help as well, however the growth might be restored by availing specific chances presented in the market. The market chances for CMP include;
• The business might also present Digital Publishing by utilizing its long term technical experience and a strong customer recognition in the market.
• CMP could consider an advancement program through the expansion towards foreign markets in order to minimize its dependence over Chinese markets by utilizing its large financial resources.
Threats
The altering macro patterns in the market and increasing competition in the publishing market has actually positioned certain threats to Ecg Group Fraud And Liquidation Of A Joint Venture In China Case Study Solution including;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries could lead to declining market share of Ecg Group Fraud And Liquidation Of A Joint Venture In China Case Study Analysis due to the consumer shift towards digital libraries.
• The existence of large number of rivals in the publishing market increase the hazard for CMP to lose its competitive position in the market, as rivals can gain a strong consumer base by utilizing particular strategies like aggressive promo, quality products, etc.
• Entrance of brand-new publishing companies in the market along with presence of high competition increases the hazard of losing the customer base.
Monetary Analysis.
Due to absence of information, the monetary ratios of CMP could not be determined. It might be examined from the Appendix III that the yearly total profits of Ecg Group Fraud And Liquidation Of A Joint Venture In China Case Study Analysis throughout 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 company is rather effective in attracting a big number of consumers at a potential rate.
Along with it, the second chart which shows the annual development in the Ecg Group Fraud And Liquidation Of A Joint Venture In China Case Study Help overall possessions, reveals that the business is rather efficient in including value to its possessions through its earnings. The growth in assets shows that the overall worth of the firm is likewise increasing with increasing the total incomes. (Unknown, 2013).
Another financial analysis of the company using the provided information could be the analysis relating to the circulation of overall revenues of the business. Major part of the earnings of CMP comes from the sales of its published books i.e. 64% as displayed in the Case Appendix V. The company could move towards other service segments with a possible development to achieve its future advancement goal.
PESTEL Analysis
PESTEL analysis could be carried out to learn the different external forces affecting the efficiency of the company and the recent trends in the external environment of the business. A quick PESTEL analysis of the company is given as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a significant influence on the mindset of individuals about the communist ideology of the federal government, therefore, the publishing sector is highly monitored and guided by the Publicity Department of the Communist Party of China. It might be stated that the general political forces impacting CMP company are high. The federal government policies relating to the publishing sector are also increasing with the passage of time.
Cost-effective.
Financial forces affecting the publishing sector in general and the CMP in particular includesthe costs of paper, the earnings level of consumers, the inflation rate, and the overall GDP development of the country. All these forces integrate impact the need for the publishing market.
Social and Demographical.
The consumer choices are shifting towards digital publishing rather than the conventional was of publishing. In this regard, CMP ought to focus on digital publishing to fulfill the changing consumer choices.
Technological.
Technological forces impacting the CMP include the technological development in the reading strategies etc. Improvement of science and technology in addition to the rise of digital publishing could lower the need for the CMP items, if specific actions would not be taken quickly.
Environmental.
Environmental forces impacting Ecg Group Fraud And Liquidation Of A Joint Venture In China Case Study Analysis consists of the concerns of environmental neighborhoods over the usage of paper in publishing books. The paper utilized in the books while publishing is needed to be disposable and the ink used while publishing should not be damaging for the environment.
Legal.
Legal regulations for the publishing sector at whole are high. The legal guidelines concerning the publishing sector is managed by the General Administration of Press and Publication. Publishing Ordinance 1997 needs the publishers to be approved first by the Government to be gone into in the publishing market. The ordinance prohibits direct involvement of foreign entities and individuals in the publishing sector.
Industry Analysis (Porter's 5 Forces Model).
Porter's 5 Forces Model 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;.
Threat of New Entrants.
Threats of brand-new entrants in the Chinese Publishing Industry is moderate. The potential development in the industry tends to draw in new entrants to the publishing market. The existence of intense competition and the requirement of huge capital tends to demotivate brand-new entrants to enter in the market.
Risk of Substitution.
Risk of Substitution is high for the Chinese Publishing Industry. The replacement products for the released files is the files provided in the virtual libraries on specific websites. The changing consumer choices towards digital learning increase the threat of substitution for the industry.
Competitive Competition.
Competitive rivalry in the publishing industry is high. The presence of a great deal of customers in the Chinese Publishing Industry like CIP, PTP etc. tends to produce high competitive competition for CMP. Together with it, new entrants are likewise participating in the marketplace increasing the competitors for CMP.
Bargaining Power of Supplier.
The significant suppliers of the Ecg Group Fraud And Liquidation Of A Joint Venture In China 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 supplier for CMP is low.
Bargaining Power of Buyer.
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 buyers needs high quality files at competitive costs.
Rivals 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 highest market share in the Chinese publishing market. Significant competitors of Ecg Group Fraud And Liquidation Of A Joint Venture In China Case Study Analysis include;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIPis among the close rivals of CMP. Established in the exact same duration, CIP publishes comparable kind of books. For a big period, CIP held the biggest market share, and still ranks 3rd and second in numerous market sectors, with a significant concentrate on academic publications. CIP functions as a danger 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 Ecg Group Fraud And Liquidation Of A Joint Venture In China Case Study Solution easily in the present market scenario.
Posts and telecommunication Press (PTP).
It was also founded in the same duration as Ecg Group Fraud And Liquidation Of A Joint Venture In China Case Study Help and CIP. It is likewise one of the prominent players in the publishing industry with an annual overall earnings of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Lowering dependence over the Chinese markets.
• Increasing variety of Customers
• Development chances.
• Preventing the effect of market saturation in the Chinese publishing industry.
Cons
• Usage of possible resources in growth.
• Danger of failure in brand-new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
Pros
• Sustaining consumer base.
• Approaching brand-new markets.
• Easy to present using existing capabilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased item portfolio offers high value to clients.
Cons
• Competition in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core organisation segments to the new one can lead the business to lose demand of its items in the market.
Recommendations
With the deep analysis of the external and internal environment of the business together with the market analysis and the rival analysis, Alternative 2 is suggested to CMP to attain its future development. As the preferences are shifting towards digital publishing and the business need an immediate option to prevent the decreasing industry growth. For that reason, introduction of digital publishing might prove to be an instant service with low quantity of danger for the company. The business might also think about 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 initially collects the information related to the consumer need, the possible markets, the federal government guidelines and the data related to the competitors presented in the market. If the preliminary offering shows a success, the company must go for the other markets. In this way the company would be able to implement its digital publishing program.
Conclusion
Although, the development of the publishing industry is decreasing considering that 2008, revealing a danger to the business's long term existence, however the circumstance can be controlled by considering an advancement strategy in the future. The company could consider presenting digital publishingin its existing market to implement its advancement program at immediate basis and to avoid the threat of failure for entrance in the new markets.
