Edward Wood Steel Stockholders A Cash Flow Exercise 2 Case Study Solution and Analysis
Edward Wood Steel Stockholders A Cash Flow Exercise 2 Case Study Analysis is the biggest publishing business with a greatest market share in the China's book retail market. CMP supplies a number of services including; collecting details, processing information and communication services. Major service sectors of the business include; books, periodicals, consultancy and circulation. The company has a huge product portfolio and its major products consist of books, periodicals, online media, exhibits, research reports etc. Edward Wood Steel Stockholders A Cash Flow Exercise 2 Case Study Solution has become a specialized information company and a big detailed Science and Technology publishing company through the combination of print media, audio-visual media and the network media.
CMP has spent its 60 years journey efficiently, being an effective publishing home, however, the altering macro market patterns and forces bring specific obstacles to the publishing market in general and Edward Wood Steel Stockholders A Cash Flow Exercise 2 Case Study Help in specific. These elements include;
• Entrance of the new publishing firms in the industry.
• Decreasing development of the publishing market.
• Market saturation.
• Intro of digital publishing methods
• Improvement of science and innovation.
The transformation 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 business could be made use of to pursue the future development unceasingly? How could the company sustain its long term competitive position in future?
Edward Wood Steel Stockholders A Cash Flow Exercise 2 Case Study Analysis has certain strengths that can be used to minimize the threats, conquer the weakness and get the opportunities. Strengths of CMP are given as follows;
• The long term experience of Edward Wood Steel Stockholders A Cash Flow Exercise 2 Case Study Analysis in the publishing market i.e. 60 years permits the business to offer high quality products at a lower expense utilizing its prior experiences.
• The technical resources and abilities produced by its effective journey supply a competitive benefit to CMP.
• Huge item portfolioof CMP helps it to diversify its risk and provide high worth to its clients.
• Strong financial position enables the business to think about numerous advancement opportunities without any fear of raising fund externally.
Along with the strengths, the business has certain weaknesses which could increase constraints for the company in executing its development program. The weaknesses of Edward Wood Steel Stockholders A Cash Flow Exercise 2 Case Study Solution are offered as follows;
• Despite of being a science and technology publishing company, the company still has traditional ways ofpublishing which are not suitable with the growing technological shift.
• CMP extremely relies over the Chinese markets for its growth. It should propose specific growth strategies to avoid its dependence over the Chinese markets to attain long term development.
The growth of the publishing market is declining since 2008, impacting Edward Wood Steel Stockholders A Cash Flow Exercise 2 Case Study Help as well, but the growth could be revived by availing certain opportunities provided in the market. The market opportunities for CMP consist of;
• The business might also introduce Digital Publishing by utilizing its long term technical experience and a strong client recognition in the market.
• CMP could consider a development program through the growth towards foreign markets in order to reduce its reliance over Chinese markets by using its huge financial resources.
The changing macro patterns in the market and increasing competition in the publishing industry has posed particular risks to Edward Wood Steel Stockholders A Cash Flow Exercise 2 Case Study Help consisting of;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries could cause declining market share of Edward Wood Steel Stockholders A Cash Flow Exercise 2 Case Study Solution due to the consumer shift towards virtual libraries.
• The existence of large number of competitors in the publishing market increase the threat for CMP to lose its competitive position in the market, as competitors can get a strong consumer base by utilizing certain strategies like aggressive promo, quality products, and so on
• Entrance of brand-new publishing companies in the market in addition to existence of high competition increases the threat of losing the customer base.
The business has a rather competitive monetary performance. Due to lack of information, the monetary ratios of CMP might not be computed. However, the total financial performance of the company could be examined by using the graphs given in the case Appendices. It could be analyzed from the Appendix III that the yearly overall revenues of CMP during the duration 2000-2012 are growing at a high growth rate, showing that the yearly need of the products of Edward Wood Steel Stockholders A Cash Flow Exercise 2 Case Study Solution is growing and the business is rather efficient in drawing in a a great deal of clients at a prospective cost.
In addition to it, the 2nd chart which reveals the yearly growth in the Edward Wood Steel Stockholders A Cash Flow Exercise 2 Case Study Solution total properties, reveals that the business is rather efficient in adding worth to its assets through its profits. The development in possessions reveals that the total value of the company is also increasing with increasing the total earnings. (Unknown, 2013).
Another monetary analysis of the company using the provided data might be the analysis concerning the circulation of overall earnings of the company. Major part of the earnings of CMP originates from the sales of its released books i.e. 64% as shown in the Case Appendix V. The business might move towards other company sectors with a prospective development to achieve its future development goal.
PESTEL analysis could be carried out to discover the different external forces impacting the efficiency of the business and the recent patterns in the external environment of the company. A short PESTEL analysis of the business is provided as follows; (Alanzi, 2018).
As the publishing sector could have a considerable impact on the mindset of the people about the communist ideology of the government, therefore, the publishing sector is extremely monitored and guided by the Publicity Department of the Communist Celebration of China. It might be said that the overall political forces impacting CMP company are high. The federal government policies regarding the publishing sector are also increasing with the passage of time.
Economic forces impacting the publishing sector in general and the Edward Wood Steel Stockholders A Cash Flow Exercise 2 Case Study Help in particular includesthe prices of paper, the earnings level of consumers, the inflation rate, and the total GDP growth of the nation. All these forces combine impact the demand for the publishing market. In addition to it, the financial policies associated with the import of books affect the general service at CPM. Nevertheless, China's economic conditions are rather beneficial for CMP with high GDP growth and customer income level.
Social and Demographical.
The customer choices are moving towards digital publishing rather than the conventional was of publishing. In this regard, CMP should focus on digital publishing to satisfy the altering consumer preferences.
Technological forces affecting the CMP consist of the technological development in the reading strategies and so on. Enhancement of science and technology together 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 Edward Wood Steel Stockholders A Cash Flow Exercise 2 Case Study Solution includes the concerns of environmental neighborhoods over the use 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 must not be hazardous for the environment.
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 requires the publishers to be authorized initially by the Federal government to be gone into in the publishing market. The regulation forbids direct participation of foreign entities and individuals in the publishing sector.
Market Analysis (Porter's 5 Forces Model).
Porter's 5 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;.
Danger of New Entrants.
Hazards of brand-new entrants in the Chinese Publishing Market is moderate. The potential growth in the industry tends to bring in brand-new entrants to the publishing industry. Nevertheless, the presence of extreme competitors and the requirement of huge capital tends to demotivate brand-new entrants to enter in the market.
Risk of Substitution.
Threat of Substitution is high for the Chinese Publishing Market. The substitute products for the published files is the documents provided in the virtual libraries on specific sites. The changing consumer preferences towards digital learning increase the threat of replacement for the industry.
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 competition for CMP. In addition to it, brand-new entrants are also participating in the market increasing the competitors for CMP.
Bargaining Power of Provider.
The significant providers of the Edward Wood Steel Stockholders A Cash Flow Exercise 2 Case Study Solution consist of the providers of the paper for publishing files. 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 presence of a large number of publishers in the Chinese market and the marketplace saturation, the buyers requires high quality files at competitive costs.
CMP operates in a highly competitive industry 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. Significant rivals of Edward Wood Steel Stockholders A Cash Flow Exercise 2 Case Study Solution include;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIP acts 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 might wean the market share of CMP quickly in the present market circumstance.
Posts and telecommunication Press (PTP).
Another close competitor of CMP is PTP. It was also founded in the exact same period as CMP and CIP. It ranks 6th in the state-owned publishers in terms of service scale. It is also among the prominent gamers in the publishing market with a yearly overall revenues of RMB 550 million in 2010.
Alternative-1: Broaden towards New Markets
• Reducing reliance over the Chinese markets.
• Increasing variety of Consumers
• Growth chances.
• Preventing the impact of market saturation in the Chinese publishing market.
• Use of potential resources in growth.
• Threat of failure in new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
• Sustaining consumer base.
• Approaching new markets.
• Easy to present utilizing existing abilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased item portfolio provides high value to consumers.
• 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 company to lose need of its products in the market.
As the choices are moving towards digital publishing and the company need an immediate solution to avoid the decreasing industry growth. The business could also think about the expansion program after the success of its digital publishing program.
In order to introduce digital publishing in its product portfolio, the company ought to first gathers the data related to the consumer demand, the possible markets, the federal government guidelines and the data related to the competitors provided in the market. If the preliminary offering proves a success, the company must go for the other markets. In this way the business would be able to execute its digital publishing program.
Although, the development of the publishing industry is declining because 2008, showing a threat to the business's long term existence, however the situation can be managed by considering an advancement strategy in the future. The business might consider introducing digital publishingin its existing market to implement its development program at instant basis and to avoid the risk of failure for entrance in the new markets.