Flip Factory Incorporation Case Study Solution and Analysis
Introduction
Flip Factory Incorporation Case Study Analysis is the biggest publishing business with a highest market share in the China's book retail market. CMP has actually become a specialized details company and a large detailed Science and Innovation publishing business through the combination of print media, audio-visual media and the network media.
Important Problems
Although, Flip Factory Incorporation Case Study Help has spent its 60 years journey smoothly, being a successful publishing house, however, the changing macro market trends and forces bring specific challenges to the publishing market in general and CMP in specific. These aspects include;
• Entrance of the new publishing companies in the market.
• Declining development of the publishing market.
• Market saturation.
• Intro of digital publishing methods
• Improvement of science and technology.
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 circumstance? Do the long important experience, technical resources and the abilities of the company could be made use of to strive for the future advancement unceasingly? How could the company sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Flip Factory Incorporation Case Study Analysis has specific strengths that can be used to lower the threats, conquer the weakness and obtain the opportunities. Strengths of CMP are offered as follows;
• The long term experience of Flip Factory Incorporation Case Study Analysis in the publishing market i.e. 60 years permits the company to supply high quality items at a lower cost utilizing its previous experiences.
• The technical resources and abilities generated by its successful journey supply a competitive benefit to CMP.
• Huge item portfolioof CMP helps it to diversify its risk and supply high value to its clients.
• Strong financial position permits the company to think about several development opportunities without any fear of raising fund externally.
Weak points
In addition to the strengths, the company has specific weaknesses which could increase constraints for the business in executing its development program. The weaknesses of Flip Factory Incorporation Case Study Solution are provided as follows;
• Despite of being a science and technology publishing company, the business still has standard ways ofpublishing which are not suitable with the growing technological shift.
• CMP extremely relies over the Chinese markets for its development. It needs to propose specific expansion strategies to prevent its dependence over the Chinese markets to accomplish long term growth.
Opportunities
Although, the development of the publishing market is declining since 2008, impacting Flip Factory Incorporation Case Study Analysis too, however the development could be revived by availing specific chances provided in the market. The market chances for CMP consist of;
• The business could also present Digital Publishing by using its long term technical experience and a strong consumer recognition in the market.
• CMP might think about a development program through the growth towards foreign markets in order to minimize its dependence over Chinese markets by utilizing its large funds.
Threats
The changing macro trends in the market and increasing competitors in the publishing market has positioned specific dangers to Flip Factory Incorporation Case Study Help including;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries could result in declining market share of Flip Factory Incorporation Case Study Help due to the customer shift towards digital libraries.
• The existence of a great deal of competitors in the publishing market increase the hazard for CMP to lose its competitive position in the market, as rivals can gain a strong customer base by using specific methods like aggressive promotion, quality items, etc.
• Entrance of brand-new publishing firms in the industry in addition to presence of high competitors increases the risk of losing the client base.
Monetary Analysis.
Due to lack of information, the financial ratios of CMP could not be determined. It could be analyzed from the Appendix III that the yearly total earnings of Flip Factory Incorporation Case Study Analysis during 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 quite efficient in bring in a large number of customers at a potential cost.
Along with it, the 2nd graph which reveals the annual development in the Flip Factory Incorporation Case Study Solution overall properties, shows that the company is quite effective in adding value to its assets through its revenues. The development in possessions reveals that the total worth of the firm is likewise increasing with increasing the total profits. (Unknown, 2013).
Another financial analysis of the company using the offered data might be the analysis concerning the circulation of overall earnings of the company. Huge part of the incomes of CMP comes from the sales of its published books i.e. 64% as displayed in the Case Appendix V. The business might move towards other service segments with a possible growth to achieve its future development goal.
PESTEL Analysis
PESTEL analysis could be carried out to find out the various external forces impacting the efficiency of the business and the recent patterns in the external environment of the company. A quick PESTEL analysis of the business is provided as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a significant effect on the mindset of the people about the communist ideology of the federal government, therefore, the publishing sector is extremely monitored and guided by the Promotion Department of the Communist Party of China. For that reason, it could be said that the general political forces impacting Flip Factory Incorporation Case Study Help business are high. The federal government policies concerning the publishing sector are likewise increasing with the passage of time.
Affordable.
Financial forces impacting the publishing sector in basic and the Flip Factory Incorporation Case Study Solution in specific includesthe rates of paper, the earnings level of customers, the inflation rate, and the general GDP growth of the nation. All these forces combine effect the demand for the publishing market. Together with it, the economic policies associated with the import of books affect the total organisation at CPM. China's financial conditions are rather beneficial for CMP with high GDP development and consumer earnings level.
Social and Demographical.
The consumer preferences are shifting towards digital publishing rather than the traditional was of publishing. In this regard, CMP should focus on digital publishing to meet the changing consumer 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 could lower the need for the CMP items, if specific actions would not be taken quickly.
Environmental.
Ecological forces impacting Flip Factory Incorporation Case Study Solution consists of the issues of ecological neighborhoods over the use of paper in publishing books. The paper utilized in the books while publishing is needed to be disposable and the ink utilized while publishing must not be damaging for the environment.
Legal.
Legal guidelines for the publishing sector at whole are high. Publishing Ordinance 1997 needs the publishers to be approved initially by the Federal government to be entered in the publishing market.
Market Analysis (Porter's Five Forces Design).
Porter's 5 Forces Design could be used to analyze the beauty of the publishing market China. A short analysis of the Porter's Five Forces is offered as follows;.
Danger of New Entrants.
Threats of brand-new entrants in the Chinese Publishing Market is moderate. The possible growth in the market tends to attract brand-new entrants to the publishing market. The existence of extreme competitors and the requirement of huge capital tends to demotivate new entrants to go into in the market.
Risk of Replacement.
Risk of Replacement is high for the Chinese Publishing Industry. The alternative items for the published documents is the documents presented in the virtual libraries on specific sites. The changing customer choices towards digital knowing increase the risk of replacement for the market.
Competitive Rivalry.
Competitive competition in the publishing industry 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. Together with it, new entrants are also participating in the marketplace increasing the competitors for CMP.
Bargaining Power of Supplier.
The significant providers of the Flip Factory Incorporation Case Study Help 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 supplier for CMP is low.
Bargaining Power of Purchaser.
Haggling power of purchaser in the publishing industry is high. Due to the existence of a large number of publishers in the Chinese market and the marketplace saturation, the buyers needs high quality documents at competitive prices.
Rivals Analysis.
CMP runs in a highly competitive market with the presence 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 competitors of Flip Factory Incorporation Case Study Help include;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIPis one of the close rivals of CMP. Established in the same period, CIP releases comparable type of books. For a large period, CIP held the largest market share, and still ranks 3rd and 2nd in numerous market segments, with a significant concentrate on educational publications. CIP serves as a risk 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 Flip Factory Incorporation Case Study Help easily in the existing market scenario.
Posts and telecommunication Press (PTP).
It was likewise established in the same duration as Flip Factory Incorporation Case Study Help and CIP. It is likewise one of the popular gamers in the publishing industry with a yearly overall incomes of RMB 550 million in 2010.
Alternatives
Alternative-1: Expand towards New Markets
Pros
• Decreasing dependence over the Chinese markets.
• Increasing variety of Consumers
• Growth opportunities.
• Avoiding the effect of market saturation in the Chinese publishing market.
Cons
• Usage of potential resources in growth.
• Risk of failure in new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining consumer base.
• Approaching brand-new markets.
• Easy to present utilizing current capabilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased product portfolio provides 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 organisation sectors to the new one can lead the business to lose demand of its products in the market.
Suggestions
With the deep analysis of the internal and external environment of the business along with the market analysis and the rival analysis, Alternative 2 is recommended to CMP to achieve its future advancement. As the choices are shifting towards digital publishing and the company require an immediate solution to prevent the declining industry development. For that reason, intro of digital publishing might show to be an immediate service with low amount of risk for the business. The business might also consider the expansion program after the success of its digital publishing program.
Execution
In order to introduce digital publishing in its item portfolio, the business should initially collects the data related to the consumer need, the possible markets, the government regulations and the information related to the competitors presented in the market. If the preliminary offering shows a success, the company ought to go for the other markets. In this method the company would be able to implement its digital publishing program.
Conclusion
The growth of the publishing market is declining because 2008, revealing a risk to the company's long term existence, but the circumstance can be controlled by considering an advancement strategy in the future. The business 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 entrance in the brand-new markets.
