Fortescue Metals Group Becoming The New Force In Iron Ore Case Study Solution and Analysis
Intro
Fortescue Metals Group Becoming The New Force In Iron Ore Case Study Solution is the largest publishing business with a highest market share in the China's book retail market. CMP supplies a number of services consisting of; gathering info, processing information and communication services. Significant business segments of the company consist of; books, periodicals, consultancy and distribution. The company has a vast product portfolio and its major items include books, regulars, online media, exhibitions, research study reports and so on. Fortescue Metals Group Becoming The New Force In Iron Ore Case Study Analysis has become a specialized details supplier and a large detailed Science and Innovation publishing business through the combination of print media, audio-visual media and the network media.
Crucial Concerns
CMP has actually invested its 60 years journey smoothly, being a successful publishing house, however, the changing macro market patterns and forces bring certain obstacles to the publishing industry in basic and Fortescue Metals Group Becoming The New Force In Iron Ore Case Study Solution in particular. These factors include;
• Entryway of the brand-new publishing companies in the industry.
• Decreasing growth of the publishing market.
• Market saturation.
• Introduction of digital publishing strategies
• Improvement of science and innovation.
The transformation of the macro markets have raised a number of concerns 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 abilities of the company could be used to pursue the future advancement unceasingly? How could the company sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Fortescue Metals Group Becoming The New Force In Iron Ore Case Study Help has specific strengths that can be utilized to minimize the risks, get rid of the weakness and avail the chances. Strengths of CMP are provided as follows;
• The long term experience of Fortescue Metals Group Becoming The New Force In Iron Ore Case Study Solution in the publishing market i.e. 60 years allows the business to offer high quality products at a lower cost utilizing its prior experiences.
• The technical resources and capabilities generated by its effective journey provide a competitive benefit to CMP.
• Large item portfolioof CMP helps it to diversify its danger and provide high value to its clients.
• Strong financial position allows the company to think about a number of development opportunities with no fear of raising fund externally.
Weaknesses
Together with the strengths, the company has particular weak points which might increase restraints for the company in implementing its development program. The weak points of Fortescue Metals Group Becoming The New Force In Iron Ore Case Study Solution are given as follows;
• Despite of being a science and innovation publishing company, the business still has traditional ways ofpublishing which are not suitable with the growing technological shift.
• CMP highly relies over the Chinese markets for its development. It should propose particular growth plans to prevent its dependence over the Chinese markets to attain long term growth.
Opportunities
Although, the growth of the publishing industry is declining considering that 2008, affecting Fortescue Metals Group Becoming The New Force In Iron Ore Case Study Solution as well, however the development might be restored by availing certain opportunities provided in the market. The market chances for CMP consist of;
• The company might likewise present Digital Publishing by utilizing its long term technical experience and a strong client acknowledgment in the market.
• CMP could consider a development program through the growth towards foreign markets in order to lower its dependence over Chinese markets by utilizing its huge financial resources.
Threats
The altering macro patterns in the market and increasing competition in the publishing industry has positioned certain threats to Fortescue Metals Group Becoming The New Force In Iron Ore Case Study Solution consisting of;( Gurel, 2017).
• Intro of digital publishing i.e. virtual libraries could lead to declining market share of Fortescue Metals Group Becoming The New Force In Iron Ore Case Study Help due to the consumer shift towards digital libraries.
• The presence of large number of competitors in the publishing industry increase the danger for CMP to lose its competitive position in the market, as rivals can get a strong customer base by utilizing specific strategies like aggressive promo, quality products, etc.
• Entrance of brand-new publishing firms in the industry along with existence of high competition increases the threat of losing the client base.
Monetary Analysis.
The company has a rather competitive financial performance. Due to absence of information, the monetary ratios of CMP might not be computed. The overall financial performance of the business might be analyzed by using the charts offered in the case Appendices. It could be evaluated from the Appendix III that the annual total incomes of CMP throughout the duration 2000-2012 are growing at a high development rate, revealing that the annual demand of the products of Fortescue Metals Group Becoming The New Force In Iron Ore Case Study Help is growing and the company is quite effective in bring in a a great deal of clients at a prospective rate.
Together with it, the 2nd chart which shows the yearly development in the Fortescue Metals Group Becoming The New Force In Iron Ore Case Study Solution total properties, shows that the business is rather effective in adding value to its assets through its incomes. The growth in properties reveals that the total value of the company is likewise increasing with increasing the total revenues. (Unknown, 2013).
Another financial analysis of the business utilizing the provided information could be the analysis relating to the circulation of total incomes of the company. Huge part of the profits of CMP originates from the sales of its published books i.e. 64% as shown in the Case Appendix V. The business might move towards other business sectors with a possible development to achieve its future development goal.
PESTEL Analysis
PESTEL analysis might be performed to learn the numerous external forces impacting the performance of the company and the recent 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 could have a significant effect on the state of mind of the people about the communist ideology of the government, for that reason, the publishing sector is highly supervised and guided by the Promotion Department of the Communist Party of China. For that reason, it might be stated that the total political forces impacting Fortescue Metals Group Becoming The New Force In Iron Ore Case Study Solution business are high. The federal government policies relating to the publishing sector are likewise increasing with the passage of time.
Economical.
Financial forces affecting the publishing sector in general and the Fortescue Metals Group Becoming The New Force In Iron Ore Case Study Analysis in particular includesthe costs of paper, the income level of customers, the inflation rate, and the total GDP development of the nation. All these forces integrate impact the demand for the publishing market. Together with it, the economic policies related to the import of books impact the general business at CPM. China's economic conditions are quite favorable for CMP with high GDP development and consumer earnings level.
Social and Demographical.
Social and demographical forces include the population growth, the customer's choices towards reading helpful materials and so on. China has the greatest population worldwide with a high population growth, showing the increasing number of consumers of the Fortescue Metals Group Becoming The New Force In Iron Ore Case Study Help. The consumer choices are shifting towards digital publishing rather than the standard was of publishing. In this regard, CMP ought to focus on digital publishing to satisfy the altering consumer preferences.
Technological.
Technological forces affecting the CMP include the technological improvement in the reading methods and so on. Improvement of science and technology together with the rise of digital publishing could lower the demand for the CMP items, if certain actions would not be taken soon.
Environmental.
Ecological forces affecting Fortescue Metals Group Becoming The New Force In Iron Ore Case Study Solution consists of the concerns of environmental communities over the use of paper in publishing books. The paper used in the books while publishing is needed to be disposable and the ink utilized while publishing should not be hazardous for the environment.
Legal.
Legal policies for the publishing sector at whole are high. Publishing Ordinance 1997 needs the publishers to be authorized first by the Federal government to be entered in the publishing market.
Industry Analysis (Porter's Five Forces Design).
Porter's 5 Forces Model might be utilized to examine the attractiveness of the publishing market China. A quick analysis of the Porter's 5 Forces is given as follows;.
Risk of New Entrants.
Dangers of brand-new entrants in the Chinese Publishing Industry is moderate. The prospective growth in the market tends to attract brand-new entrants to the publishing market. However, the presence of extreme competitors and the requirement of big capital tends to demotivate brand-new entrants to enter in the market.
Danger of Replacement.
Danger of Alternative is high for the Chinese Publishing Market. The alternative products for the published documents is the documents presented in the virtual libraries on certain websites. The altering customer choices towards digital learning increase the hazard of substitution for the industry.
Competitive Rivalry.
Competitive competition in the publishing market is high. The presence of large number of consumers in the Chinese Publishing Market like CIP, PTP and so on tends to produce high competitive competition for CMP. Together with it, brand-new entrants are also participating in the market increasing the competition for CMP.
Bargaining Power of Provider.
The major providers of the Fortescue Metals Group Becoming The New Force In Iron Ore Case Study Solution include the suppliers of the paper for publishing files. As CMP is the biggest publisher in the Chinese Publishing Market, therefore the general bargaining power of supplier for CMP is low.
Bargaining Power of Purchaser.
Negotiating 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 buyers requires high quality files at competitive prices.
Competitors Analysis.
CMP runs in an extremely competitive market with the existence of a great deal of rivals. However, the business has a competitive position in the market with the greatest market share in the Chinese publishing market. Major competitors of Fortescue Metals Group Becoming The New Force In Iron Ore Case Study Analysis consist of;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIPis among the close competitors of CMP. Founded in the same period, CIP publishes comparable kind of books. For a large time period, CIP held the largest market share, and still ranks 3rd and second in different market segments, with a significant focus on academic publications. CIP serves as a danger for CMP as it could wean its market share due to its long term competitive background. CIP is concentrated on digital publishing and could wean the market share of Fortescue Metals Group Becoming The New Force In Iron Ore Case Study Help easily in the existing market situation.
Posts and telecommunication Press (PTP).
Another close competitor of CMP is PTP. It was likewise founded in the very same period as CMP and CIP. It ranks 6th in the state-owned publishers in regards to organisation scale. It is also one of the popular gamers in the publishing market with an annual overall revenues of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Minimizing dependence over the Chinese markets.
• Increasing number of Customers
• Development opportunities.
• Preventing the effect of market saturation in the Chinese publishing industry.
Cons
• Usage of possible resources in expansion.
• Threat of failure in new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
Pros
• Sustaining customer base.
• Approaching brand-new markets.
• Easy to introduce using current abilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased product portfolio provides high value to customers.
Cons
• Competitors in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core company sections to the brand-new one can lead the business to lose need of its items in the market.
Suggestions
With the deep analysis of the external and internal environment of the company along with the industry analysis and the competitor analysis, Alternative 2 is recommended to CMP to attain its future development. As the preferences are moving towards digital publishing and the company need an immediate option to avoid the declining industry growth. Introduction of digital publishing might prove to be an instant option with low quantity of danger for the business. Nevertheless, the company could likewise think about the growth program after the success of its digital publishing program.
Implementation
In order to present digital publishing in its product portfolio, the business needs to first gathers the information related to the consumer need, the possible markets, the government regulations and the information related to the competitors provided in the market. If the preliminary offering proves a success, the business should go for the other markets. In this method the company would be able to execute its digital publishing program.
Conclusion
The development of the publishing market is declining because 2008, showing a hazard to the business's long term existence, but the scenario can be controlled by thinking about an advancement strategy in the future. The business might think about introducing digital publishingin its existing market to execute its advancement program at instant basis and to prevent the risk of failure for entryway in the brand-new markets.
