Economic Principles And Decision Making 2 Case Study Solution and Analysis
Introduction
Economic Principles And Decision Making 2 Case Study Analysis is the biggest publishing company with a highest market share in the China's book retail market. CMP has actually ended up being a specialized details supplier and a big detailed Science and Technology publishing company through the integration of print media, audio-visual media and the network media.
Vital Issues
CMP has spent its 60 years journey smoothly, being an effective publishing house, nevertheless, the changing macro market patterns and forces bring certain difficulties to the publishing market in general and Economic Principles And Decision Making 2 Case Study Analysis in specific. These elements consist of;
• Entryway of the brand-new publishing firms in the market.
• Declining development of the publishing market.
• Market saturation.
• Intro of digital publishing methods
• Enhancement 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 situation? 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
Economic Principles And Decision Making 2 Case Study Analysis has specific strengths that can be used to minimize the threats, overcome the weak point and avail the opportunities. Strengths of CMP are given as follows;
• The long term experience of Economic Principles And Decision Making 2 Case Study Analysis in the publishing industry i.e. 60 years allows the business to offer high quality items at a lower cost utilizing its prior experiences.
• The technical resources and capabilities created by its effective journey supply a competitive benefit to CMP.
• Vast item portfolioof CMP helps it to diversify its risk and provide high value to its customers.
• Strong financial position allows the business to think about a number of development opportunities with no worry of raising fund externally.
Weak points
Along with the strengths, the company has specific weaknesses which might increase restrictions for the company in implementing its development program. The weaknesses of Economic Principles And Decision Making 2 Case Study Help are given as follows;
• Despite of being a science and technology publishing company, the company still has conventional methods ofpublishing which are not compatible with the growing technological shift.
• CMP highly relies over the Chinese markets for its growth. It needs to propose certain expansion strategies to prevent its reliance over the Chinese markets to attain long term development.
Opportunities
Although, the development of the publishing industry is decreasing because 2008, affecting Economic Principles And Decision Making 2 Case Study Solution as well, but the development could be restored by availing certain chances provided in the market. The market opportunities for CMP consist of;
• The company might also introduce Digital Publishing by utilizing its long term technical experience and a strong customer acknowledgment in the market.
• CMP might consider a development program through the expansion towards foreign markets in order to decrease its dependence over Chinese markets by utilizing its huge financial resources.
Threats
The changing macro trends in the market and increasing competition in the publishing industry has postured certain threats to Economic Principles And Decision Making 2 Case Study Help including;( Gurel, 2017).
• Introduction of digital publishing i.e. digital libraries could result in decreasing market share of Economic Principles And Decision Making 2 Case Study Solution due to the consumer shift towards digital libraries.
• The presence of large number of competitors 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 using certain strategies like aggressive promotion, quality products, etc.
• Entryway of new publishing companies in the industry in addition to existence of high competition increases the danger of losing the client base.
Monetary Analysis.
Due to lack of data, the financial ratios of CMP could not be computed. It could be examined from the Appendix III that the annual total incomes of Economic Principles And Decision Making 2 Case Study Solution throughout the duration 2000-2012 are growing at a high growth rate, showing that the yearly demand of the items of CMP is growing and the company is rather efficient in attracting a big number of clients at a prospective cost.
In addition to it, the second chart which reveals the yearly development in the Economic Principles And Decision Making 2 Case Study Solution overall assets, reveals that the business is quite efficient in including worth to its assets through its earnings. The growth in possessions shows that the overall worth of the company is also increasing with increasing the total incomes. (Unidentified, 2013).
Another monetary analysis of the business utilizing the offered information could be the analysis concerning the distribution of total revenues of the company. Huge part of the revenues of CMP originates from the sales of its published books i.e. 64% as shown in the Case Appendix V. The business might move towards other organisation sectors with a possible development to accomplish its future development objective.
PESTEL Analysis
PESTEL analysis might be carried out to discover the numerous external forces impacting the efficiency of the business and the current patterns in the external environment of the business. A short PESTEL analysis of the business is given as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a significant impact on the frame of mind of individuals about the communist ideology of the federal government, for that reason, the publishing sector is highly monitored and directed by the Publicity Department of the Communist Celebration of China. It could be said that the total political forces impacting CMP company are high. The government policies concerning 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 costs of paper, the earnings level of consumers, the inflation rate, and the total GDP development of the country. All these forces combine impact the demand for the publishing market.
Social and Demographical.
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 satisfy the changing consumer choices.
Technological.
Technological forces affecting the CMP include the technological improvement in the reading methods etc. Improvement of science and innovation along with the increase of digital publishing could decrease the demand for the CMP products, if specific actions would not be taken soon.
Environmental.
Environmental forces impacting Economic Principles And Decision Making 2 Case Study Help consists of the concerns of ecological neighborhoods over the use of paper in publishing books. The paper used 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.
Legal regulations for the publishing sector at whole are high. The legal guidelines relating to the publishing sector is managed by the General Administration of Press and Publication. Publishing Regulation 1997 requires the publishers to be approved first by the Federal government to be gone into in the publishing market. The ordinance forbids direct involvement of foreign entities and people in the publishing sector.
Market Analysis (Porter's Five Forces Design).
Porter's Five Forces Design could be utilized to analyze the beauty of the publishing industry China. A quick analysis of the Porter's Five Forces is offered as follows;.
Threat of New Entrants.
Hazards 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 market. Nevertheless, the presence of extreme competitors and the requirement of huge capital tends to demotivate new entrants to enter in the market.
Danger of Substitution.
Risk of Replacement is high for the Chinese Publishing Market. The substitute items for the published files is the documents presented in the virtual libraries on certain sites. The altering customer preferences towards digital knowing increase the risk of alternative for the market.
Competitive Competition.
Competitive rivalry in the publishing industry is high. The presence of large number of consumers 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 marketplace increasing the competitors for CMP.
Bargaining Power of Supplier.
The significant providers of the Economic Principles And Decision Making 2 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 Buyer.
Negotiating power of buyer in the publishing market is high. Due to the presence of a a great deal of publishers in the Chinese market and the market saturation, the purchasers requires high quality documents at competitive prices.
Rivals Analysis.
CMP runs in an extremely competitive industry with the presence of large number of competitors. However, the company has a competitive position in the market with the greatest market share in the Chinese publishing market. Major rivals of Economic Principles And Decision Making 2 Case Study Help include;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIPis one of the close rivals of CMP. Founded in the very same duration, CIP publishes similar kind of books. For a big period, CIP held the biggest market share, and still ranks third and second in different market sections, with a significant concentrate on academic publications. CIP serves 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 might wean the marketplace share of Economic Principles And Decision Making 2 Case Study Solution easily in the existing market scenario.
Posts and telecommunication Press (PTP).
It was likewise founded in the exact same duration as Economic Principles And Decision Making 2 Case Study Solution and CIP. It is also one of the popular players in the publishing market with a yearly overall earnings of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Reducing reliance over the Chinese markets.
• Increasing number of Customers
• Development chances.
• Preventing the effect of market saturation in the Chinese publishing industry.
Cons
• Use of prospective resources in expansion.
• Threat 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 current capabilities.
• Low risk of Failure.
• Low requirement for funds.
• Increased item portfolio supplies high worth to consumers.
Cons
• Competitors in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core service sections to the brand-new one can lead the business to lose demand of its products in the market.
Suggestions
As the preferences are shifting towards digital publishing and the business require an immediate service to prevent the decreasing industry development. The business could also think about the growth program after the success of its digital publishing program.
Implementation
In order to introduce digital publishing in its item portfolio, the business ought to first gathers the data related to the consumer demand, the prospective markets, the government regulations and the data related to the competitors presented in the market. If the initial offering proves 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 development of the publishing market is declining given that 2008, showing a hazard to the company's long term presence, however the scenario can be managed by considering a development strategy in the future. The business might consider 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 brand-new markets.
