Honest Tea Case Case Study Solution and Analysis
Intro
Honest Tea Case Case Study Solution is the largest publishing company with a highest market share in the China's book retail market. CMP supplies a variety of services consisting of; gathering information, processing details and interaction services. Major business sectors of the company include; books, periodicals, consultancy and distribution. The company has a vast item portfolio and its major products include books, regulars, online media, exhibitions, research study reports and so on. Honest Tea Case Case Study Help has ended up being a specialized details service provider and a large detailed Science and Innovation publishing company through the combination of print media, audio-visual media and the network media.
Vital Problems
Although, Honest Tea Case Case Study Analysis has actually invested its 60 years journey smoothly, being an effective publishing house, however, the changing macro market trends and forces bring particular challenges to the publishing market in basic and CMP in particular. These factors consist of;
• Entrance of the brand-new publishing companies in the industry.
• Decreasing development of the publishing market.
• Market saturation.
• Intro of digital publishing strategies
• Enhancement of science and technology.
The transformation of the macro markets have raised numerous concerns to the management at CPM that what could be the future of CMP in this situation? Do the long important experience, technical resources and the capabilities of the company could be utilized to strive for the future development unceasingly? How could the company sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Honest Tea Case Case Study Analysis has particular strengths that can be used to decrease the threats, conquer the weak point and get the chances. Strengths of CMP are given as follows;
• The long term experience of Honest Tea Case Case Study Solution in the publishing market i.e. 60 years enables the business to supply high quality products at a lower expense utilizing its prior experiences.
• The technical resources and abilities produced by its successful journey supply a competitive benefit to CMP.
• Large item portfolioof CMP assists it to diversify its risk and supply high worth to its consumers.
• Strong financial position enables the business to consider several advancement opportunities with no fear of raising fund externally.
Weaknesses
Together with the strengths, the company has specific weak points which could increase restrictions for the business in implementing its advancement program. The weak points of Honest Tea Case Case Study Solution are offered as follows;
• Despite of being a science and innovation publishing firm, the business still has traditional methods ofpublishing which are not suitable with the growing technological shift.
• CMP highly relies over the Chinese markets for its development. It ought to propose particular expansion plans to prevent its reliance over the Chinese markets to accomplish long term development.
Opportunities
The growth of the publishing industry is declining since 2008, affecting Honest Tea Case Case Study Solution as well, however the development might be restored by availing certain chances presented in the market. The marketplace 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 could consider an advancement program through the expansion towards foreign markets in order to decrease its dependence over Chinese markets by using its large financial resources.
Dangers
The changing macro trends in the market and increasing competition in the publishing industry has actually positioned certain hazards to Honest Tea Case Case Study Help including;( Gurel, 2017).
• Introduction of digital publishing i.e. digital libraries could result in decreasing market share of Honest Tea Case Case Study Solution due to the customer shift towards virtual 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 gain a strong customer base by using specific methods like aggressive promo, quality products, and so on
• Entrance of brand-new publishing companies in the market along with presence of high competition increases the danger of losing the client base.
Monetary Analysis.
The business has a rather competitive financial performance. Due to lack of information, the monetary ratios of CMP could not be computed. However, the general financial efficiency of the business could be examined by utilizing the graphs given up the case Appendices. It might be analyzed from the Appendix III that the yearly total revenues of CMP during the duration 2000-2012 are growing at a high growth rate, revealing that the yearly demand of the products of Honest Tea Case Case Study Help is growing and the business is rather effective in attracting a a great deal of clients at a prospective price.
Together with it, the 2nd graph which shows the annual development in the Honest Tea Case Case Study Solution total properties, reveals that the business is quite effective in adding worth to its properties through its revenues. The growth in possessions reveals that the overall worth of the firm is also increasing with increasing the total revenues. (Unidentified, 2013).
Another monetary analysis of the business utilizing the provided data might be the analysis concerning the distribution of total revenues of the business. Huge part of the profits of CMP comes from the sales of its published books i.e. 64% as displayed in the Case Appendix V. The business could move towards other organisation segments with a prospective development to accomplish its future advancement goal.
PESTEL Analysis
PESTEL analysis could be performed to find out the numerous external forces affecting the performance of the business and the current patterns in the external environment of the business. A brief PESTEL analysis of the business is offered as follows; (Alanzi, 2018).
Political.
As the publishing sector could have a substantial impact on the mindset of the people about the communist ideology of the federal government, therefore, the publishing sector is highly supervised and assisted by the Publicity Department of the Communist Celebration of China. For that reason, it could be stated that the overall political forces affecting Honest Tea Case Case Study Help business are high. The federal government policies relating to the publishing sector are likewise increasing with the passage of time.
Cost-effective.
Economic forces affecting the publishing sector in general and the CMP in specific includesthe prices of paper, the income level of consumers, the inflation rate, and the general GDP development of the nation. All these forces integrate effect the demand for the publishing market.
Social and Demographical.
Social and demographical forces consist of the population development, the consumer's choices towards reading useful products etc. China has the highest population worldwide with a high population growth, showing the increasing number of consumers of the Honest Tea Case Case Study Analysis. The consumer choices are shifting towards digital publishing rather than the traditional was of publishing. In this regard, CMP should concentrate on digital publishing to meet the altering consumer preferences.
Technological.
Technological forces impacting the CMP consist of the technological advancement in the reading methods etc. Enhancement of science and innovation along with the increase of digital publishing could reduce the demand for the CMP items, if particular actions would not be taken quickly.
Environmental.
Ecological forces affecting Honest Tea Case Case Study Help includes the issues of ecological neighborhoods over the use of paper in publishing books. The paper used in the books while publishing is required to be disposable and the ink used while publishing should not be damaging for the environment.
Legal.
Legal regulations for the publishing sector at whole are high. Publishing Ordinance 1997 needs the publishers to be approved first by the Government to be entered in the publishing market.
Market Analysis (Porter's 5 Forces Design).
Porter's 5 Forces Design might be utilized to analyze the appearance of the publishing industry China. A brief analysis of the Porter's Five Forces is provided as follows;.
Danger of New Entrants.
Threats of new entrants in the Chinese Publishing Market is moderate. The prospective growth in the industry tends to attract new entrants to the publishing market. The existence of intense competitors and the requirement of substantial capital tends to demotivate brand-new entrants to go into in the market.
Threat of Alternative.
Hazard of Substitution is high for the Chinese Publishing Industry. The replacement items for the published files is the documents presented in the digital libraries on specific sites. The changing consumer choices towards digital learning increase the risk of replacement for the market.
Competitive Competition.
Competitive rivalry in the publishing market 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 competition for CMP. Along with it, brand-new entrants are also participating in the market increasing the competition for CMP.
Bargaining Power of Provider.
The significant providers of the Honest Tea Case Case Study Solution include the suppliers of the paper for releasing files. As CMP is the biggest publisher in the Chinese Publishing Market, therefore the overall bargaining power of provider for CMP is low.
Bargaining Power of Purchaser.
Bargaining power of purchaser in the publishing industry is high. Due to the existence of a a great deal of publishers in the Chinese market and the marketplace saturation, the purchasers requires high quality documents at competitive prices.
Competitors Analysis.
CMP operates in a highly competitive market with the presence of large number of rivals. However, the company has a competitive position in the market with the highest market share in the Chinese publishing market. Major rivals of Honest Tea Case Case Study Analysis consist of;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIP acts as a threat for CMP as it might 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 easily in the current market circumstance.
Posts and telecommunication Press (PTP).
It was likewise established in the same period as Honest Tea Case Case Study Analysis and CIP. It is likewise one of the prominent gamers in the publishing market with a yearly total profits 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 impact of market saturation in the Chinese publishing market.
Cons
• Usage of possible resources in expansion.
• Danger of failure in new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining consumer base.
• Approaching brand-new markets.
• Easy to introduce utilizing present abilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased item portfolio supplies high value to clients.
Cons
• Competitors in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core service sectors to the brand-new one can lead the company to lose demand of its items in the market.
Suggestions
As the preferences are shifting towards digital publishing and the business need an immediate solution to prevent the declining industry growth. The company might likewise consider the expansion program after the success of its digital publishing program.
Execution
In order to present digital publishing in its product portfolio, the company should first gathers the information associated with the customer need, the potential markets, the government regulations and the data related to the competitors presented in the market. After that, the business ought to choose one possible segment for its preliminary offering. It should collect research that how it might separate its digital publishing from the existing competitors' products. After all the actions above the company should go for the initial offering. If the initial offering proves a success, the business must choose the other markets. In this method the business would be able to execute its digital publishing program.
Conclusion
Although, the development of the publishing market is decreasing considering that 2008, showing a threat to the business's long term presence, but the scenario can be managed by thinking about a development strategy in the future. The business could think about presenting digital publishingin its existing market to execute its advancement program at instant basis and to avoid the threat of failure for entryway in the brand-new markets.
