Financial Management Case Study Solution and Analysis
Introduction
Financial Management Case Study Solution is the biggest publishing business with a greatest market share in the China's book retail market. CMP provides a variety of services including; collecting info, processing info and interaction services. Significant business segments of the business consist of; books, periodicals, consultancy and distribution. The business has a large item portfolio and its significant products consist of books, regulars, online media, exhibits, research reports etc. Financial Management Case Study Solution has actually become 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.
Critical Concerns
Although, Financial Management Case Study Solution has actually spent its 60 years journey efficiently, being an effective publishing house, however, the changing macro market trends and forces bring specific challenges to the publishing industry in basic and CMP in particular. These factors include;
• Entryway of the brand-new publishing firms in the market.
• Declining development of the publishing market.
• Market saturation.
• Intro of digital publishing techniques
• Enhancement of science and innovation.
The change of the macro markets have raised numerous concerns to the management at CPM that what could be the future of CMP in this circumstance? Do the long important experience, technical resources and the capabilities of the business could be utilized 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
Financial Management Case Study Solution has specific strengths that can be used to decrease the hazards, conquer the weak point and avail the chances. Strengths of CMP are offered as follows;
• The long term experience of Financial Management Case Study Solution in the publishing market i.e. 60 years allows the business to offer high quality products at a lower expense using its previous experiences.
• The technical resources and abilities produced by its successful journey offer a competitive benefit to CMP.
• Vast item portfolioof CMP assists it to diversify its threat and provide high value to its customers.
• Strong monetary position permits the company to consider several development opportunities without any fear of raising fund externally.
Weak points
In addition to the strengths, the business has particular weak points which might increase restraints for the company in executing its advancement program. The weaknesses of Financial Management Case Study Solution are offered as follows;
• Despite of being a science and technology publishing firm, the business still has conventional methods ofpublishing which are not compatible with the growing technological shift.
• CMP extremely relies over the Chinese markets for its development. It should propose particular growth strategies to avoid its dependence over the Chinese markets to achieve long term development.
Opportunities
The growth of the publishing market is declining considering that 2008, affecting Financial Management Case Study Solution as well, but the development could be revived by availing particular chances provided in the market. The marketplace chances for CMP consist of;
• The business might likewise introduce Digital Publishing by using its long term technical experience and a strong consumer recognition in the market.
• CMP could think about an advancement program through the expansion towards foreign markets in order to reduce its dependence over Chinese markets by using its huge financial resources.
Risks
The altering macro patterns in the market and increasing competition in the publishing market has presented specific threats to Financial Management Case Study Help including;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries could result in decreasing market share of Financial Management Case Study Analysis due to the customer shift towards digital libraries.
• The existence of a great deal of rivals in the publishing market increase the threat for CMP to lose its competitive position in the market, as rivals can acquire a strong customer base by utilizing particular techniques like aggressive promo, quality items, etc.
• Entryway of new publishing firms in the industry along with existence of high competitors increases the hazard of losing the customer base.
Monetary Analysis.
Due to lack of data, the financial ratios of CMP might not be computed. It could be analyzed from the Appendix III that the annual total incomes of Financial Management Case Study Analysis throughout the duration 2000-2012 are growing at a high growth rate, revealing that the yearly need of the products of CMP is growing and the business is rather effective in drawing in a big number of clients at a prospective price.
Together with it, the second chart which shows the annual growth in the Financial Management Case Study Analysis total possessions, shows that the company is quite effective in including value to its assets through its profits. The development in properties reveals that the total value of the company is also increasing with increasing the total profits. (Unidentified, 2013).
Another monetary analysis of the company using the given data might be the analysis concerning the distribution of total earnings of the company. Huge part of the revenues of CMP comes from the sales of its released books i.e. 64% as shown in the Case Appendix V. The company might move towards other organisation sectors with a potential development to achieve its future advancement objective.
PESTEL Analysis
PESTEL analysis could be conducted to find out the different external forces affecting the performance of the company and the recent patterns in the external environment of the company. A short PESTEL analysis of the company is provided as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a substantial effect on the mindset of the people about the communist ideology of the government, therefore, the publishing sector is extremely monitored and guided by the Promotion Department of the Communist Celebration of China. It might be said that the general political forces impacting CMP company are high. The government policies relating to the publishing sector are likewise increasing with the passage of time.
Affordable.
Economic forces affecting the publishing sector in basic and the Financial Management Case Study Analysis in particular includesthe rates of paper, the earnings level of customers, the inflation rate, and the overall GDP development of the country. All these forces integrate effect the need for the publishing market. In addition to it, the financial policies connected to the import of books impact the total organisation at CPM. China's economic conditions are quite favorable for CMP with high GDP growth and customer earnings level.
Social and Demographical.
The customer preferences are moving towards digital publishing rather than the traditional was of publishing. In this regard, CMP should focus on digital publishing to satisfy the altering customer preferences.
Technological.
Technological forces affecting the CMP consist of the technological improvement in the reading techniques and so on. Enhancement of science and innovation together with the rise of digital publishing could minimize the demand for the CMP items, if specific actions would not be taken quickly.
Environmental.
Ecological forces impacting Financial Management Case Study Solution consists of the concerns of environmental neighborhoods over the use of paper in publishing books. The paper utilized in the books while publishing is needed to be non reusable and the ink used while publishing must not be hazardous for the environment.
Legal.
Legal policies for the publishing sector at whole are high. The legal regulations regarding the publishing sector is controlled by the General Administration of Press and Publication. Publishing Regulation 1997 needs the publishers to be authorized initially by the Federal government to be entered in the publishing market. The regulation forbids direct participation of foreign entities and individuals in the publishing sector.
Industry Analysis (Porter's 5 Forces Design).
Porter's 5 Forces Model could be used to examine the beauty of the publishing market China. A quick analysis of the Porter's 5 Forces is provided as follows;.
Risk of New Entrants.
Threats of brand-new entrants in the Chinese Publishing Industry is moderate. The prospective development in the market tends to draw in new entrants to the publishing market. The existence of extreme competitors and the requirement of big capital tends to demotivate new entrants to enter in the market.
Threat of Alternative.
Hazard of Substitution is high for the Chinese Publishing Market. The replacement items for the published files is the documents provided in the virtual libraries on certain websites. The changing customer preferences towards digital learning increase the risk of replacement for the industry.
Competitive Competition.
Competitive competition in the publishing market 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 rivalry for CMP. Along with it, new entrants are also entering into the market increasing the competitors for CMP.
Bargaining Power of Provider.
The major providers of the Financial Management Case Study Solution consist of the providers of the paper for releasing documents. As CMP is the largest publisher in the Chinese Publishing Market, for that reason the overall bargaining power of supplier for CMP is low.
Bargaining Power of Buyer.
Bargaining 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 documents at competitive rates.
Competitors Analysis.
CMP runs in a highly competitive industry with the existence of a great deal of rivals. The company has a competitive position in the market with the greatest market share in the Chinese publishing market. Significant rivals of Financial Management Case Study Analysis include;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIPis one of the close competitors of CMP. Established in the same period, CIP releases comparable type of books. For a big period, CIP held the biggest market share, and still ranks third and second in different market segments, with a major concentrate on instructional publications. 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 Financial Management Case Study Solution easily in the present market scenario.
Posts and telecommunication Press (PTP).
It was also established in the same period as Financial Management Case Study Help and CIP. It is also one of the popular gamers in the publishing market with an annual total revenues of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Lowering reliance over the Chinese markets.
• Increasing variety of Consumers
• Development opportunities.
• Avoiding the effect of market saturation in the Chinese publishing industry.
Cons
• Use of possible resources in expansion.
• Risk of failure in brand-new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
Pros
• Sustaining customer base.
• Approaching new markets.
• Easy to present using existing capabilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased product portfolio supplies high worth to customers.
Cons
• Competitors in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core service sectors to the brand-new one can lead the business to lose need of its items in the market.
Recommendations
As the choices are shifting towards digital publishing and the business require an immediate service to avoid the declining industry development. The business could also think about the expansion program after the success of its digital publishing program.
Execution
In order to introduce digital publishing in its item portfolio, the business needs to first gathers the information related to the consumer need, the potential markets, the federal government regulations and the data related to the rivals presented in the market. If the initial offering proves a success, the company ought to go for the other markets. In this method the business would be able to implement its digital publishing program.
Conclusion
The development of the publishing industry is decreasing considering that 2008, showing a danger to the company's long term presence, but the scenario can be controlled by thinking about an advancement plan in the future. The business could consider presenting digital publishingin its existing market to implement its advancement program at instant basis and to avoid the danger of failure for entryway in the brand-new markets.
