Flip Factory Inc 2 Case Study Solution and Analysis
Flip Factory Inc 2 Case Study Analysis is the biggest publishing company with a greatest market share in the China's book retail market. CMP offers a number of services consisting of; collecting information, processing details and interaction services. Major business sectors of the business include; books, periodicals, consultancy and distribution. The company has a large item portfolio and its significant items include books, regulars, online media, exhibits, research study reports etc. Flip Factory Inc 2 Case Study Solution has actually ended up being a specialized information provider and a big detailed Science and Innovation publishing business through the integration of print media, audio-visual media and the network media.
Although, Flip Factory Inc 2 Case Study Solution has spent its 60 years journey efficiently, being an effective publishing house, however, the changing macro market patterns and forces bring specific difficulties to the publishing industry in general and CMP in specific. These factors include;
• Entryway of the new publishing companies in the industry.
• Decreasing development of the publishing market.
• Market saturation.
• Intro of digital publishing strategies
• Enhancement of science and innovation.
The transformation of the macro markets have raised numerous questions 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 pursue the future development unceasingly? How could the company sustain its long term competitive position in future?
Flip Factory Inc 2 Case Study Solution has particular strengths that can be used to decrease the dangers, get rid of the weakness and obtain the opportunities. Strengths of CMP are given as follows;
• The long term experience of Flip Factory Inc 2 Case Study Analysis in the publishing industry i.e. 60 years allows the company to supply high quality items at a lower expense utilizing its previous experiences.
• The technical resources and abilities generated by its effective journey offer a competitive advantage to CMP.
• Huge product portfolioof CMP helps it to diversify its threat and provide high worth to its customers.
• Strong monetary position enables the business to think about numerous advancement opportunities with no worry of raising fund externally.
In addition to the strengths, the business has specific weak points which could increase restrictions for the business in executing its development program. The weaknesses of Flip Factory Inc 2 Case Study Solution are given as follows;
• Despite of being a science and technology publishing company, the company still has traditional ways ofpublishing which are not compatible with the growing technological shift.
• CMP highly relies over the Chinese markets for its development. It must propose certain expansion strategies to prevent its reliance over the Chinese markets to accomplish long term growth.
The growth of the publishing market is decreasing considering that 2008, affecting Flip Factory Inc 2 Case Study Analysis as well, however the development might be revived by availing specific opportunities presented in the market. The market chances for CMP consist of;
• The company might also present Digital Publishing by using its long term technical experience and a strong customer acknowledgment in the market.
• CMP might think about an advancement program through the growth towards foreign markets in order to decrease its reliance over Chinese markets by using its large funds.
The changing macro trends in the market and increasing competition in the publishing industry has actually posed particular hazards to Flip Factory Inc 2 Case Study Solution consisting of;( Gurel, 2017).
• Introduction of digital publishing i.e. virtual libraries could cause declining market share of Flip Factory Inc 2 Case Study Solution due to the consumer shift towards virtual libraries.
• The existence of a great deal of competitors in the publishing industry increase the risk for CMP to lose its competitive position in the market, as rivals can gain a strong customer base by utilizing particular techniques like aggressive promotion, quality products, and so on
• Entrance of brand-new publishing firms in the market together with existence of high competition increases the threat of losing the client base.
Due to lack of information, the financial ratios of CMP might not be determined. It might be evaluated from the Appendix III that the yearly total revenues of Flip Factory Inc 2 Case Study Help throughout the duration 2000-2012 are growing at a high growth rate, showing that the annual demand of the items of CMP is growing and the company is rather effective in bring in a big number of consumers at a possible price.
In addition to it, the second chart which reveals the yearly growth in the Flip Factory Inc 2 Case Study Analysis overall possessions, shows that the business is rather efficient in adding worth to its possessions through its revenues. The development in assets reveals that the overall worth of the firm is likewise increasing with increasing the overall earnings. (Unknown, 2013).
Another monetary analysis of the business using the given information might be the analysis regarding the circulation of total revenues of the company. Huge part of the profits of CMP comes from the sales of its published books i.e. 64% as shown in the Case Appendix V. The company could move towards other company sections with a possible development to accomplish its future advancement objective.
PESTEL analysis might be carried out to learn the numerous external forces impacting the performance of the business and the recent patterns in the external environment of the business. A brief PESTEL analysis of the company is offered as follows; (Alanzi, 2018).
As the publishing sector could have a substantial influence on the mindset of the people about the communist ideology of the federal government, for that reason, the publishing sector is highly supervised and guided by the Publicity Department of the Communist Celebration of China. Therefore, it could be stated that the general political forces impacting Flip Factory Inc 2 Case Study Help organisation are high. The government policies concerning the publishing sector are also increasing with the passage of time.
Financial forces affecting the publishing sector in general and the Flip Factory Inc 2 Case Study Analysis in particular includesthe costs of paper, the income level of consumers, the inflation rate, and the general GDP development of the country. All these forces integrate impact the need for the publishing market. Together with it, the financial policies related to the import of books impact the total business at CPM. However, China's economic conditions are quite favorable for CMP with high GDP growth and customer income level.
Social and Demographical.
The customer preferences are shifting towards digital publishing rather than the traditional was of publishing. In this regard, CMP must focus on digital publishing to satisfy the changing consumer choices.
Technological forces impacting the CMP include the technological advancement in the reading techniques and so on. Enhancement of science and innovation together with the rise of digital publishing could decrease the need for the CMP products, if particular actions would not be taken soon.
Ecological forces impacting Flip Factory Inc 2 Case Study Analysis includes the concerns of ecological communities over the usage 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 hazardous for the environment.
Legal policies for the publishing sector at whole are high. The legal regulations relating to the publishing sector is managed by the General Administration of Press and Publication. Publishing Regulation 1997 needs the publishers to be approved first by the Federal government to be entered in the publishing market. The ordinance prohibits direct participation of foreign entities and people in the publishing sector.
Industry Analysis (Porter's Five Forces Model).
Porter's 5 Forces Design might be utilized to examine the beauty of the publishing market China. A short analysis of the Porter's Five Forces is provided as follows;.
Danger of New Entrants.
Threats of brand-new entrants in the Chinese Publishing Industry is moderate. The potential development in the market tends to attract new entrants to the publishing market. The presence of extreme competitors and the requirement of huge capital tends to demotivate new entrants to enter in the market.
Risk of Replacement.
Danger of Alternative is high for the Chinese Publishing Market. The replacement items for the published files is the files provided in the digital libraries on specific websites. The altering consumer preferences towards digital learning increase the risk of substitution for the market.
Competitive competition in the publishing industry is high. The presence of large number of customers in the Chinese Publishing Market like CIP, PTP and so on tends to produce high competitive rivalry for CMP. Together with it, new entrants are likewise participating in the market increasing the competitors for CMP.
Bargaining Power of Supplier.
The major suppliers of the Flip Factory Inc 2 Case Study Analysis consist of the providers of the paper for releasing files. As CMP is the largest publisher in the Chinese Publishing Market, for that reason the general bargaining power of supplier for CMP is low.
Bargaining Power of Purchaser.
Haggling power of buyer in the publishing market is high. Due to the existence of a a great deal of publishers in the Chinese market and the market saturation, the purchasers needs high quality documents at competitive rates.
CMP operates in an extremely competitive market with the presence of large number of rivals. Nevertheless, the company has a competitive position in the market with the highest market share in the Chinese publishing market. Major rivals of Flip Factory Inc 2 Case Study Solution consist of;.
• Chemical Industry 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 could wean the market share of CMP quickly in the present market scenario.
Posts and telecommunication Press (PTP).
It was also founded in the exact same period as Flip Factory Inc 2 Case Study Analysis and CIP. It is likewise one of the popular players in the publishing market with a yearly overall revenues of RMB 550 million in 2010.
Alternative-1: Expand towards New Markets
• Lowering dependence over the Chinese markets.
• Increasing variety of Consumers
• Growth opportunities.
• Avoiding the effect of market saturation in the Chinese publishing market.
• Usage of prospective resources in expansion.
• Threat of failure in brand-new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
• Sustaining customer base.
• Approaching brand-new markets.
• Easy to introduce using present capabilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased item portfolio provides high value to clients.
• Competition in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core business segments to the new one can lead the company to lose demand of its items in the market.
As the choices are shifting towards digital publishing and the company require an immediate option to prevent the decreasing market growth. The business could likewise think about the growth program after the success of its digital publishing program.
In order to present digital publishing in its item portfolio, the business needs to first collects the information related to the customer demand, the possible markets, the federal government regulations and the data related to the rivals presented in the market. If the initial offering proves a success, the business needs to 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 considering that 2008, revealing a threat to the company's long term existence, but the situation can be managed by considering an advancement strategy in the future. The company might consider introducing digital publishingin its existing market to execute its advancement program at instant basis and to avoid the danger of failure for entryway in the new markets.