Hongxing Auto Sales And Service Co Case Study Solution and Analysis
Introduction
Hongxing Auto Sales And Service Co Case Study Solution is the biggest publishing business with a greatest market share in the China's book retail market. CMP has ended up being a specialized information provider and a big extensive Science and Technology publishing business through the integration of print media, audio-visual media and the network media.
Crucial Concerns
CMP has actually spent its 60 years journey smoothly, being an effective publishing house, however, the altering macro market trends and forces bring certain obstacles to the publishing industry in basic and Hongxing Auto Sales And Service Co Case Study Help in particular. These aspects consist of;
• Entrance of the new publishing companies in the market.
• Decreasing development of the publishing market.
• Market saturation.
• Intro of digital publishing techniques
• 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 scenario? Do the long important experience, technical resources and the abilities of the company could be used to pursue the future advancement unceasingly? How could the business sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Hongxing Auto Sales And Service Co Case Study Solution has particular strengths that can be used to decrease the risks, conquer the weakness and avail the chances. Strengths of CMP are given as follows;
• The long term experience of Hongxing Auto Sales And Service Co Case Study Solution in the publishing industry i.e. 60 years enables the business to provide high quality products at a lower cost utilizing its previous experiences.
• The technical resources and capabilities created by its successful journey provide a competitive benefit to CMP.
• Large item portfolioof CMP helps it to diversify its danger and offer high worth to its clients.
• Strong financial position enables the company to consider numerous development chances without any worry of raising fund externally.
Weak points
In addition to the strengths, the company has particular weak points which might increase constraints for the business in executing its advancement program. The weak points of Hongxing Auto Sales And Service Co Case Study Analysis are given as follows;
• Despite of being a science and technology publishing firm, 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 should propose specific expansion strategies to avoid its dependence over the Chinese markets to accomplish long term development.
Opportunities
Although, the growth of the publishing industry is decreasing since 2008, affecting Hongxing Auto Sales And Service Co Case Study Help also, however the development might be revived by availing certain chances presented in the market. The market opportunities for CMP include;
• The company could likewise introduce Digital Publishing by utilizing its long term technical experience and a strong client acknowledgment in the market.
• CMP could think about a development program through the expansion towards foreign markets in order to lower its reliance over Chinese markets by utilizing its large funds.
Hazards
The altering macro patterns in the market and increasing competition in the publishing market has actually posed specific hazards to Hongxing Auto Sales And Service Co Case Study Help consisting of;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries might result in declining market share of Hongxing Auto Sales And Service Co Case Study Help due to the consumer shift towards virtual libraries.
• The existence of a great deal of rivals in the publishing industry increase the danger for CMP to lose its competitive position in the market, as rivals can get a strong consumer base by using certain strategies like aggressive promo, quality products, and so on
• Entryway of new publishing firms in the industry along with presence of high competitors increases the risk of losing the customer base.
Monetary Analysis.
Due to lack of data, the financial ratios of CMP might not be calculated. It might be examined from the Appendix III that the yearly total earnings of Hongxing Auto Sales And Service Co Case Study Analysis during the period 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 large number of clients at a potential rate.
Together with it, the second graph which shows the annual development in the Hongxing Auto Sales And Service Co Case Study Solution overall properties, shows that the business is rather efficient in including worth to its possessions through its incomes. The growth in assets reveals that the overall worth of the firm is also increasing with increasing the total earnings. (Unidentified, 2013).
Another financial analysis of the company utilizing the provided data could be the analysis regarding the distribution of overall incomes of the company. Huge 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 business could move towards other service segments with a potential growth to accomplish its future development objective.
PESTEL Analysis
PESTEL analysis might be conducted to learn the numerous external forces impacting the efficiency of the company and the current patterns in the external environment of the company. A short PESTEL analysis of the business is offered as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a significant effect on the mindset of individuals about the communist ideology of the government, for that reason, the publishing sector is extremely monitored and assisted by the Publicity Department of the Communist Celebration of China. It could be said that the overall political forces affecting CMP company are high. The federal government policies regarding the publishing sector are likewise increasing with the passage of time.
Cost-effective.
Economic forces affecting the publishing sector in basic and the Hongxing Auto Sales And Service Co Case Study Analysis in specific includesthe rates of paper, the income level of customers, the inflation rate, and the general GDP development of the country. All these forces combine impact the need for the publishing market. In addition to it, the economic policies connected to the import of books affect the overall business at CPM. However, China's financial conditions are rather favorable for CMP with high GDP development and consumer earnings level.
Social and Demographical.
The customer preferences are moving towards digital publishing rather than the conventional was of publishing. In this regard, CMP ought to focus on digital publishing to satisfy the altering consumer choices.
Technological.
Technological forces impacting the CMP consist of the technological development in the reading techniques etc. Improvement of science and innovation in addition to the rise of digital publishing could decrease the demand for the CMP items, if particular actions would not be taken soon.
Environmental.
Ecological forces impacting Hongxing Auto Sales And Service Co Case Study Analysis consists of the concerns of environmental 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 used while publishing must not be hazardous for the environment.
Legal.
Legal regulations for the publishing sector at whole are high. The legal policies relating to the publishing sector is controlled by the General Administration of Press and Publication. Publishing Ordinance 1997 needs the publishers to be approved initially by the Federal government to be entered in the publishing market. The ordinance forbids direct involvement of foreign entities and individuals in the publishing sector.
Industry Analysis (Porter's 5 Forces Model).
Porter's Five Forces Model might be utilized to examine the beauty of the publishing market China. A short analysis of the Porter's Five Forces is given as follows;.
Hazard of New Entrants.
Risks of brand-new entrants in the Chinese Publishing Industry is moderate. The possible development in the industry tends to attract brand-new entrants to the publishing market. However, the presence of intense competitors and the requirement of big capital tends to demotivate brand-new entrants to enter in the marketplace.
Danger of Substitution.
Hazard of Substitution is high for the Chinese Publishing Industry. The substitute products for the published files is the files provided in the virtual libraries on certain sites. The changing consumer preferences towards digital learning increase the threat of replacement for the industry.
Competitive Competition.
Competitive rivalry in the publishing industry is high. The existence of a great deal of consumers in the Chinese Publishing Industry like CIP, PTP etc. tends to produce high competitive rivalry for CMP. Together with it, new entrants are likewise entering into the marketplace increasing the competition for CMP.
Bargaining Power of Supplier.
The significant providers of the Hongxing Auto Sales And Service Co Case Study Analysis consist of the providers of the paper for releasing documents. As CMP is the biggest publisher in the Chinese Publishing Market, therefore the overall bargaining power of supplier for CMP is low.
Bargaining Power of Buyer.
Haggling power of purchaser in the publishing industry is high. Due to the presence of a a great deal of publishers in the Chinese market and the marketplace saturation, the buyers needs high quality documents at competitive costs.
Rivals Analysis.
CMP runs in an extremely competitive industry with the presence of large number of rivals. The company has a competitive position in the market with the highest market share in the Chinese publishing market. Significant competitors of Hongxing Auto Sales And Service Co Case Study Analysis consist of;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIP acts as a risk for CMP as it might wean its market share due to its long term competitive background. CIP is focused on digital publishing and might wean the market share of CMP quickly in the current market situation.
Posts and telecommunication Press (PTP).
Another close competitor of CMP is PTP. It was likewise established in the same period as CMP and CIP. It ranks 6th in the state-owned publishers in regards to company scale. It is likewise one of the popular gamers in the publishing industry with a yearly overall profits of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Decreasing dependence over the Chinese markets.
• Increasing number of Clients
• Growth opportunities.
• Avoiding the effect of market saturation in the Chinese publishing industry.
Cons
• Use of potential resources in expansion.
• Threat of failure in brand-new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining consumer base.
• Approaching new markets.
• Easy to present utilizing current capabilities.
• Low risk of Failure.
• Low requirement for funds.
• Increased item portfolio provides high value to clients.
Cons
• Competitors in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core service segments to the new one can lead the company to lose need of its products in the market.
Suggestions
As the choices are moving towards digital publishing and the business require an immediate service to prevent the decreasing market development. The business could likewise consider the expansion program after the success of its digital publishing program.
Execution
In order to present digital publishing in its item portfolio, the company needs to first gathers the data connected to the customer need, the prospective markets, the federal government policies and the data related to the rivals provided in the market. After that, the company needs to decide one prospective segment for its initial offering. It must gather research study that how it could distinguish its digital publishing from the existing rivals' products. After all the steps above the company need to opt for the preliminary offering. The company should go for the other markets if the preliminary offering shows a success. In this method the company would be able to implement its digital publishing program.
Conclusion
The growth of the publishing industry is declining because 2008, revealing a threat to the business's long term existence, however the scenario can be controlled by considering a development plan in the future. The company could think about presenting digital publishingin its existing market to execute its advancement program at immediate basis and to prevent the danger of failure for entrance in the brand-new markets.
