Facebook Valuation 2 Case Study Solution and Analysis
Intro
Facebook Valuation 2 Case Study Analysis is the biggest publishing company with a greatest market share in the China's book retail market. CMP provides a variety of services consisting of; collecting info, processing info and interaction services. Significant business segments of the business include; books, regulars, consultancy and circulation. The company has a huge product portfolio and its major items consist of books, regulars, online media, exhibits, research reports etc. Facebook Valuation 2 Case Study Help has actually ended up being a specialized details supplier and a large comprehensive Science and Innovation publishing business through the integration of print media, audio-visual media and the network media.
Critical Issues
Although, Facebook Valuation 2 Case Study Solution has actually invested its 60 years journey efficiently, being an effective publishing house, however, the changing macro market trends and forces bring specific obstacles to the publishing market in basic and CMP in specific. These aspects consist of;
• Entrance of the new publishing firms in the market.
• Decreasing development of the publishing market.
• Market saturation.
• Intro of digital publishing strategies
• Enhancement of science and innovation.
The change of the macro markets have raised several 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 business 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
Facebook Valuation 2 Case Study Help has specific strengths that can be used to reduce the risks, overcome the weak point and avail the opportunities. Strengths of CMP are provided as follows;
• The long term experience of Facebook Valuation 2 Case Study Help in the publishing industry i.e. 60 years permits the business to supply high quality products at a lower expense using its prior experiences.
• The technical resources and capabilities produced by its successful journey supply a competitive advantage to CMP.
• Huge item portfolioof CMP assists it to diversify its danger and offer high value to its clients.
• Strong monetary position enables the company to think about several development chances with no fear of raising fund externally.
Weak points
Along with the strengths, the company has certain weak points which might increase restraints for the business in executing its development program. The weak points of Facebook Valuation 2 Case Study Solution are provided as follows;
• Despite of being a science and innovation publishing company, the company still has standard ways ofpublishing which are not suitable with the growing technological shift.
• CMP highly relies over the Chinese markets for its growth. It should propose particular expansion strategies to prevent its reliance over the Chinese markets to achieve long term growth.
Opportunities
Although, the development of the publishing market is decreasing since 2008, impacting Facebook Valuation 2 Case Study Help too, however the development might be restored by availing certain chances presented in the market. The marketplace chances for CMP consist of;
• The business might also introduce Digital Publishing by using its long term technical experience and a strong client recognition in the market.
• CMP might think about an advancement program through the growth towards foreign markets in order to decrease its dependence over Chinese markets by using its vast financial resources.
Threats
The altering macro trends in the market and increasing competitors in the publishing industry has actually postured specific hazards to Facebook Valuation 2 Case Study Help including;( Gurel, 2017).
• Introduction of digital publishing i.e. virtual libraries might cause decreasing market share of Facebook Valuation 2 Case Study Solution due to the customer shift towards digital libraries.
• The presence of large number of rivals in the publishing market increase the risk for CMP to lose its competitive position in the market, as competitors can acquire a strong customer base by using certain techniques like aggressive promotion, quality products, and so on
• Entryway of new publishing firms in the industry together with existence of high competitors increases the threat of losing the consumer base.
Financial Analysis.
The business has a rather competitive financial efficiency. Due to lack of data, the financial ratios of CMP could not be determined. The overall financial efficiency of the company could be analyzed by utilizing the graphs provided in the case Appendices. It might be analyzed from the Appendix III that the annual overall incomes of CMP during the period 2000-2012 are growing at a high growth rate, showing that the annual demand of the items of Facebook Valuation 2 Case Study Solution is growing and the business is rather efficient in attracting a large number of customers at a prospective price.
Together with it, the second chart which shows the annual growth in the Facebook Valuation 2 Case Study Solution overall properties, shows that the business is rather efficient in adding worth to its properties through its earnings. The development in properties shows that the overall value of the company is likewise increasing with increasing the total revenues. (Unidentified, 2013).
Another monetary analysis of the business utilizing the given data could be the analysis regarding the distribution of overall incomes of the business. Major part of the revenues of CMP comes from the sales of its published books i.e. 64% as displayed in the Case Appendix V. The business could move towards other service segments with a possible growth to achieve its future development objective.
PESTEL Analysis
PESTEL analysis could be performed to find out the various external forces affecting the efficiency of the company and the current trends in the external environment of the business. A quick PESTEL analysis of the business is given as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a considerable influence on the frame of mind of the people about the communist ideology of the federal government, for that reason, the publishing sector is highly supervised and assisted by the Promotion Department of the Communist Celebration of China. Therefore, it might be said that the overall political forces affecting Facebook Valuation 2 Case Study Analysis company are high. The federal government policies concerning the publishing sector are also increasing with the passage of time.
Affordable.
Economic forces impacting the publishing sector in basic and the Facebook Valuation 2 Case Study Analysis in particular includesthe rates of paper, the income level of customers, the inflation rate, and the total GDP growth of the nation. All these forces integrate impact the need for the publishing market. Along with it, the financial policies related to the import of books impact the total company at CPM. China's economic conditions are quite beneficial for CMP with high GDP growth and consumer earnings level.
Social and Demographical.
Social and demographical forces consist of the population growth, the consumer's preferences towards reading helpful materials and so on. China has the greatest population in the world with a high population development, showing the increasing number of customers of the Facebook Valuation 2 Case Study Analysis. The consumer preferences 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 customer choices.
Technological.
Technological forces impacting the CMP include the technological development in the reading techniques etc. Improvement of science and innovation in addition to the increase of digital publishing might lower the need for the CMP items, if specific actions would not be taken quickly.
Environmental.
Environmental forces impacting Facebook Valuation 2 Case Study Solution includes the concerns of environmental communities over the usage of paper in publishing books. The paper used in the books while publishing is needed to be non reusable and the ink utilized while publishing should not be damaging for the environment.
Legal.
Legal policies for the publishing sector at whole are high. Publishing Regulation 1997 requires the publishers to be approved first by the Government to be entered in the publishing market.
Market Analysis (Porter's 5 Forces Design).
Porter's 5 Forces Model could be utilized to examine the attractiveness of the publishing industry China. A brief analysis of the Porter's 5 Forces is provided as follows;.
Risk of New Entrants.
Dangers of new entrants in the Chinese Publishing Industry is moderate. The potential growth in the industry tends to attract brand-new entrants to the publishing market. However, the existence of intense competition and the requirement of big capital tends to demotivate new entrants to go into in the market.
Threat of Substitution.
Threat of Substitution is high for the Chinese Publishing Market. The alternative products for the published files is the files provided in the virtual libraries on specific websites. The changing customer preferences towards digital learning increase the risk of substitution for the industry.
Competitive Rivalry.
Competitive rivalry in the publishing industry is high. The presence of a great deal of consumers in the Chinese Publishing Market like CIP, PTP and so on tends to produce high competitive rivalry for CMP. In addition to it, new entrants are also participating in the marketplace increasing the competitors for CMP.
Bargaining Power of Supplier.
The major providers of the Facebook Valuation 2 Case Study Help include the suppliers of the paper for publishing files. As CMP is the biggest publisher in the Chinese Publishing Market, for that reason the total bargaining power of supplier for CMP is low.
Bargaining Power of Purchaser.
Haggling power of purchaser in the publishing industry is high. Due to the presence of a a great deal of publishers in the Chinese market and the marketplace saturation, the purchasers requires high quality documents at competitive costs.
Rivals Analysis.
CMP operates in an extremely competitive industry with the existence of a great deal of competitors. Nevertheless, the business has a competitive position in the market with the greatest market share in the Chinese publishing market. Significant competitors of Facebook Valuation 2 Case Study Analysis include;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIP acts as a threat for CMP as it might 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 present market scenario.
Posts and telecommunication Press (PTP).
It was likewise established in the very same duration as Facebook Valuation 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
• Decreasing reliance over the Chinese markets.
• Increasing number of Clients
• Growth chances.
• Preventing the impact of market saturation in the Chinese publishing market.
Cons
• Use of potential resources in expansion.
• Risk of failure in brand-new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining consumer base.
• Approaching new markets.
• Easy to introduce utilizing current abilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased product portfolio offers high value to consumers.
Cons
• Competitors in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core service sections to the brand-new one can lead the business to lose need of its products in the market.
Suggestions
With the deep analysis of the external and internal environment of the business together with the market analysis and the competitor analysis, Alternative 2 is suggested to CMP to attain its future advancement. As the preferences are moving towards digital publishing and the business require an immediate solution to prevent the decreasing market development. Intro of digital publishing could prove to be an immediate option with low quantity of threat for the business. The company could also consider the growth program after the success of its digital publishing program.
Execution
In order to present digital publishing in its item portfolio, the company ought to first collects the information associated with the customer need, the potential markets, the federal government guidelines and the information related to the rivals presented in the market. After that, the company ought to decide one potential segment for its initial offering. It ought to collect research that how it could differentiate its digital publishing from the existing rivals' items. The steps above the company ought to go for the preliminary offering. If the initial offering proves a success, the company ought to choose the other markets. In this method the company would have the ability to execute its digital publishing program.
Conclusion
Although, the development of the publishing market is decreasing since 2008, revealing a danger to the company's long term existence, however the situation can be managed by considering an advancement strategy in the future. The company might think about introducing digital publishingin its existing market to execute its advancement program at immediate basis and to avoid the risk of failure for entryway in the new markets.
