Flip Factory Inc 2 Case Study Solution and Analysis
Introduction
Flip Factory Inc 2 Case Study Analysis is the largest publishing business with a greatest market share in the China's book retail market. CMP provides a variety of services including; gathering info, processing details and interaction services. Major organisation sections of the business include; books, periodicals, consultancy and distribution. The company has a huge product portfolio and its major products include books, regulars, online media, exhibitions, research reports etc. Flip Factory Inc 2 Case Study Analysis has become a specialized info company and a big comprehensive Science and Technology publishing business through the combination of print media, audio-visual media and the network media.
Important Issues
CMP has invested its 60 years journey smoothly, being an effective publishing house, however, the changing macro market patterns and forces bring particular challenges to the publishing industry in general and Flip Factory Inc 2 Case Study Solution in specific. These elements consist of;
• Entryway of the brand-new publishing firms in the market.
• Declining growth 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 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 abilities of the business could be utilized to pursue the future development unceasingly? How could the company sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Flip Factory Inc 2 Case Study Solution has certain strengths that can be used to reduce the threats, get rid of the weak point and avail the opportunities. Strengths of CMP are offered as follows;
• The long term experience of Flip Factory Inc 2 Case Study Analysis in the publishing industry i.e. 60 years enables the company to offer high quality items at a lower expense using its prior experiences.
• The technical resources and abilities produced by its effective journey provide a competitive benefit to CMP.
• Huge product portfolioof CMP assists it to diversify its danger and provide high value to its customers.
• Strong monetary position permits the business to consider numerous development chances with no worry of raising fund externally.
Weaknesses
Along with the strengths, the business has specific weaknesses which could increase restraints for the company in executing its development program. The weaknesses of Flip Factory Inc 2 Case Study Help are offered as follows;
• Despite of being a science and innovation publishing firm, the business still has traditional 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 particular expansion strategies to prevent its dependence over the Chinese markets to attain long term development.
Opportunities
Although, the growth of the publishing industry is decreasing because 2008, affecting Flip Factory Inc 2 Case Study Analysis as well, but the growth might be revived by availing particular opportunities presented in the market. The marketplace chances for CMP consist of;
• The company might likewise present Digital Publishing by utilizing its long term technical experience and a strong consumer acknowledgment in the market.
• CMP might think about an advancement program through the expansion towards foreign markets in order to lower its dependence over Chinese markets by utilizing its large financial resources.
Dangers
The changing macro trends in the market and increasing competition in the publishing market has actually positioned certain dangers to Flip Factory Inc 2 Case Study Solution consisting of;( Gurel, 2017).
• Introduction of digital publishing i.e. virtual libraries could cause decreasing market share of Flip Factory Inc 2 Case Study Analysis due to the consumer shift towards digital libraries.
• The presence of large number of rivals in the publishing industry increase the threat for CMP to lose its competitive position in the market, as competitors can acquire a strong customer base by utilizing specific methods like aggressive promotion, quality products, and so on
• Entryway of brand-new publishing companies in the industry together with existence of high competitors increases the threat of losing the customer base.
Financial Analysis.
The business has a quite competitive financial efficiency. Due to lack of information, the monetary ratios of CMP might not be calculated. The overall financial performance of the business could be examined by using the graphs offered in the case Appendices. It might be examined from the Appendix III that the yearly overall incomes of CMP throughout the period 2000-2012 are growing at a high development rate, revealing that the annual demand of the products of Flip Factory Inc 2 Case Study Solution is growing and the company is quite efficient in drawing in a large number of customers at a potential cost.
Together with it, the 2nd chart which shows the annual growth in the Flip Factory Inc 2 Case Study Solution overall assets, shows that the company is quite efficient in including value to its properties through its earnings. The growth in possessions shows that the total worth of the firm is also increasing with increasing the total profits. (Unknown, 2013).
Another monetary analysis of the company utilizing the offered information could be the analysis relating to the circulation of total earnings of the business. Major part of the incomes of CMP originates from the sales of its released books i.e. 64% as displayed in the Case Appendix V. The company could move towards other service sectors with a potential development to attain its future development goal.
PESTEL Analysis
PESTEL analysis could be conducted to find out the numerous external forces impacting the efficiency of the business and the current trends in the external environment of the business. A short PESTEL analysis of the business is offered as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a substantial influence on the frame of mind of individuals about the communist ideology of the federal government, for that reason, the publishing sector is extremely monitored and directed by the Publicity Department of the Communist Celebration of China. It might be said that the overall political forces impacting CMP service are high. The government policies relating to the publishing sector are likewise increasing with the passage of time.
Cost-effective.
Financial forces impacting the publishing sector in basic and the Flip Factory Inc 2 Case Study Analysis in particular includesthe rates of paper, the earnings level of consumers, the inflation rate, and the overall GDP development of the country. All these forces integrate effect the need for the publishing market. Along with it, the economic policies associated with the import of books impact the total organisation at CPM. Nevertheless, China's financial conditions are rather favorable for CMP with high GDP development and consumer income level.
Social and Demographical.
The customer choices are moving towards digital publishing rather than the conventional was of publishing. In this regard, CMP must focus on digital publishing to meet the altering customer preferences.
Technological.
Technological forces impacting the CMP consist of the technological advancement in the reading strategies etc. Improvement of science and technology along with the rise of digital publishing might minimize the need for the CMP products, if certain actions would not be taken quickly.
Environmental.
Environmental forces affecting Flip Factory Inc 2 Case Study Help consists of the issues 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 ought to not be hazardous for the environment.
Legal.
Legal guidelines for the publishing sector at whole are high. The legal regulations concerning the publishing sector is controlled by the General Administration of Press and Publication. Publishing Ordinance 1997 requires the publishers to be approved first by the Federal government to be gone into in the publishing market. The regulation prohibits direct involvement of foreign entities and people in the publishing sector.
Industry Analysis (Porter's 5 Forces Model).
Porter's Five Forces Design could be used to evaluate the beauty of the publishing market China. A short analysis of the Porter's 5 Forces is offered as follows;.
Risk of New Entrants.
Hazards of new entrants in the Chinese Publishing Industry is moderate. The potential growth in the industry tends to draw in new entrants to the publishing market. The presence of intense competition and the requirement of substantial capital tends to demotivate new entrants to enter in the market.
Danger of Alternative.
Hazard of Alternative is high for the Chinese Publishing Industry. The replacement items for the released documents is the documents presented in the virtual libraries on specific sites. The changing consumer preferences towards digital knowing increase the risk of alternative for the market.
Competitive Rivalry.
Competitive competition in the publishing market is high. The existence of large number of customers in the Chinese Publishing Industry like CIP, PTP etc. tends to produce high competitive competition for CMP. Along with it, new entrants are likewise participating in the market increasing the competitors for CMP.
Bargaining Power of Provider.
The significant providers of the Flip Factory Inc 2 Case Study Solution include the suppliers of the paper for publishing documents. As CMP is the largest publisher in the Chinese Publishing Market, therefore the general bargaining power of provider for CMP is low.
Bargaining Power of Purchaser.
Bargaining power of purchaser in the publishing market is high. Due to the existence of a large number of publishers in the Chinese market and the marketplace saturation, the purchasers needs high quality files at competitive prices.
Rivals Analysis.
CMP operates in a highly competitive market with the presence of a great deal of competitors. The company has a competitive position in the market with the highest market share in the Chinese publishing market. Significant rivals of Flip Factory Inc 2 Case Study Help consist of;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIPis one of the close competitors of CMP. Established in the very same period, CIP publishes similar kind of books. For a large period, CIP held the largest market share, and still ranks 3rd and 2nd in various market sections, with a major focus on educational publications. CIP acts as a danger for CMP as it might wean its market share due to its long term competitive background. CIP is concentrated on digital publishing and could wean the market share of Flip Factory Inc 2 Case Study Solution quickly in the present market scenario.
Posts and telecommunication Press (PTP).
Another close rival of CMP is PTP. It was also established in the very same duration as CMP and CIP. It ranks sixth in the state-owned publishers in terms of business scale. It is also one of the popular players in the publishing industry with a yearly total profits of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Reducing reliance over the Chinese markets.
• Increasing variety of Consumers
• Development chances.
• Preventing the effect of market saturation in the Chinese publishing industry.
Cons
• Use of prospective 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 introduce using existing capabilities.
• Low risk of Failure.
• Low requirement for funds.
• Increased product portfolio provides high value to clients.
Cons
• Competition in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core organisation sectors to the new one can lead the business to lose need of its products in the market.
Recommendations
With the deep analysis of the external and internal environment of the company together with the market analysis and the rival analysis, Alternative 2 is recommended to CMP to achieve its future development. As the preferences are shifting towards digital publishing and the company require an immediate solution to prevent the decreasing industry development. For that reason, introduction of digital publishing could show to be an immediate option with low quantity of risk for the business. The company could also consider 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 initially collects the information related to the consumer need, the prospective markets, the federal government guidelines and the information related to the competitors provided in the market. If the preliminary offering shows a success, the company ought to go for the other markets. In this way the business would be able to execute its digital publishing program.
Conclusion
The growth of the publishing market is decreasing given that 2008, showing a danger to the business's long term existence, however the situation can be managed by considering an advancement strategy in the future. The business could consider introducing digital publishingin its existing market to execute its advancement program at instant basis and to avoid the danger of failure for entrance in the brand-new markets.
