International Financial Management Case Study Solution and Analysis
International Financial Management Case Study Solution is the largest publishing business with a highest market share in the China's book retail market. CMP offers a variety of services consisting of; gathering information, processing information and communication services. Significant organisation sectors of the business consist of; books, regulars, consultancy and distribution. The business has a vast item portfolio and its significant products include books, regulars, online media, exhibitions, research study reports etc. International Financial Management Case Study Analysis has actually ended up being a specialized information service provider and a big detailed Science and Technology publishing company through the combination of print media, audio-visual media and the network media.
CMP has spent its 60 years journey efficiently, being an effective publishing house, however, the altering macro market trends and forces bring certain obstacles to the publishing industry in general and International Financial Management Case Study Analysis in specific. These factors consist of;
• Entrance of the brand-new publishing companies in the industry.
• Decreasing growth of the publishing market.
• Market saturation.
• Introduction of digital publishing techniques
• Enhancement of science and innovation.
The improvement of the macro markets have raised several 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 used to strive for the future development unceasingly? How could the business sustain its long term competitive position in future?
International Financial Management Case Study Analysis has particular strengths that can be used to reduce the threats, get rid of the weak point and avail the chances. Strengths of CMP are provided as follows;
• The long term experience of International Financial Management Case Study Analysis in the publishing market i.e. 60 years allows the company to supply high quality products at a lower expense utilizing its previous experiences.
• The technical resources and capabilities created by its effective journey supply a competitive benefit to CMP.
• Vast item portfolioof CMP assists it to diversify its risk and supply high worth to its clients.
• Strong financial position permits the business to consider several development opportunities without any fear of raising fund externally.
In addition to the strengths, the company has particular weak points which could increase constraints for the company in implementing its development program. The weak points of International Financial Management Case Study Solution are provided as follows;
• Despite of being a science and technology publishing company, the company still has standard ways ofpublishing which are not compatible with the growing technological shift.
• CMP extremely relies over the Chinese markets for its development. It ought to propose particular growth strategies to prevent its dependence over the Chinese markets to accomplish long term growth.
Although, the growth of the publishing industry is decreasing because 2008, affecting International Financial Management Case Study Analysis also, however the development might be revived by availing particular opportunities presented in the market. The marketplace opportunities for CMP include;
• The business could likewise 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 lower its dependence over Chinese markets by utilizing its huge financial resources.
The altering macro patterns in the market and increasing competitors in the publishing industry has actually positioned particular threats to International Financial Management Case Study Analysis including;( Gurel, 2017).
• Introduction of digital publishing i.e. virtual libraries might result in decreasing market share of International Financial Management Case Study Solution due to the consumer shift towards digital libraries.
• The existence of a great deal of rivals in the publishing market increase the danger for CMP to lose its competitive position in the market, as competitors can acquire a strong consumer base by utilizing specific methods like aggressive promo, quality products, etc.
• Entrance of new publishing firms in the market together with presence of high competitors increases the hazard of losing the consumer base.
Due to absence of data, the financial ratios of CMP might not be determined. It could be analyzed from the Appendix III that the yearly total revenues of International Financial Management Case Study Analysis during the duration 2000-2012 are growing at a high development rate, showing that the yearly demand of the items of CMP is growing and the company is quite efficient in attracting a big number of customers at a prospective cost.
Along with it, the second graph which shows the annual development in the International Financial Management Case Study Analysis total assets, reveals that the business is rather effective in adding value to its properties through its profits. The development in possessions reveals that the total worth of the company is likewise increasing with increasing the overall earnings. (Unidentified, 2013).
Another monetary analysis of the company utilizing the given data might be the analysis regarding the distribution of total incomes of the business. Huge part of the earnings 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 company segments with a potential growth to accomplish its future development goal.
PESTEL analysis could be performed to learn the different external forces affecting the performance of the business and the current trends in the external environment of the company. A quick PESTEL analysis of the company is offered as follows; (Alanzi, 2018).
As the publishing sector might have a substantial effect on the state of mind of the people about the communist ideology of the government, for that reason, the publishing sector is extremely supervised and guided by the Promotion Department of the Communist Party of China. It might be stated that the total political forces affecting CMP company are high. The government policies relating to the publishing sector are also increasing with the passage of time.
Financial forces impacting the publishing sector in general and the International Financial Management Case Study Solution in specific includesthe prices of paper, the earnings level of consumers, the inflation rate, and the general GDP growth of the nation. All these forces integrate effect the need for the publishing market. Along with it, the economic policies related to the import of books affect the overall business at CPM. China's financial conditions are rather favorable for CMP with high GDP growth and consumer earnings level.
Social and Demographical.
Social and demographical forces include the population development, the consumer's preferences towards reading helpful products and so on. China has the greatest population worldwide with a high population development, showing the increasing variety of customers of the International Financial Management Case Study Help. The consumer choices are shifting towards digital publishing rather than the traditional was of publishing. In this regard, CMP needs to focus on digital publishing to fulfill the changing consumer choices.
Technological forces impacting the CMP consist of the technological development in the reading techniques etc. Enhancement of science and technology together with the increase of digital publishing might lower the demand for the CMP products, if particular actions would not be taken quickly.
Ecological forces affecting International Financial Management Case Study Help consists of the concerns of environmental communities over the usage of paper in publishing books. The paper utilized in the books while publishing is needed to be non reusable and the ink used while publishing needs to not be harmful for the environment.
Legal policies for the publishing sector at whole are high. Publishing Ordinance 1997 needs the publishers to be approved first by the Federal government to be entered in the publishing market.
Industry Analysis (Porter's Five Forces Design).
Porter's Five Forces Model could be utilized to evaluate the beauty of the publishing market China. A brief analysis of the Porter's Five Forces is given as follows;.
Risk of New Entrants.
Dangers of brand-new entrants in the Chinese Publishing Market is moderate. The potential growth in the industry tends to attract new entrants to the publishing market. Nevertheless, the presence of extreme competitors and the requirement of substantial capital tends to demotivate brand-new entrants to enter in the market.
Danger of Replacement.
Danger of Substitution is high for the Chinese Publishing Industry. The substitute products for the published documents is the files presented in the digital libraries on particular websites. The altering customer choices towards digital learning increase the danger of alternative for the market.
Competitive rivalry in the publishing market is high. The existence of a great deal of consumers in the Chinese Publishing Market like CIP, PTP and so on tends to produce high competitive competition for CMP. Along with it, new entrants are likewise entering into the market increasing the competitors for CMP.
Bargaining Power of Provider.
The significant providers of the International Financial Management Case Study Analysis consist of the providers of the paper for publishing files. As CMP is the biggest publisher in the Chinese Publishing Market, for that reason the total bargaining power of supplier for CMP is low.
Bargaining Power of Buyer.
Haggling power of purchaser in the publishing market is high. Due to the existence of a a great deal of publishers in the Chinese market and the marketplace saturation, the purchasers needs high quality documents at competitive prices.
CMP runs in an extremely competitive market with the existence of large number of competitors. Nevertheless, the business has a competitive position in the market with the highest market share in the Chinese publishing market. Significant rivals of International Financial Management Case Study Analysis consist of;.
• Chemical Industry 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 easily in the current market circumstance.
Posts and telecommunication Press (PTP).
Another close competitor of CMP is PTP. It was also founded in the same period as CMP and CIP. It ranks sixth in the state-owned publishers in regards to business scale. It is likewise among the prominent players in the publishing market with a yearly overall earnings of RMB 550 million in 2010.
Alternative-1: Expand towards New Markets
• Decreasing reliance over the Chinese markets.
• Increasing number of Customers
• Growth opportunities.
• Preventing the effect of market saturation in the Chinese publishing industry.
• Use of potential resources in expansion.
• Threat of failure in new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
• Sustaining customer base.
• Approaching new markets.
• Easy to present using current abilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased item portfolio offers high worth to customers.
• Competition in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core organisation sections to the new one can lead the company to lose need of its items in the market.
As the choices are moving towards digital publishing and the business require an instant service to prevent the declining industry development. The business could also think about the expansion program after the success of its digital publishing program.
In order to introduce digital publishing in its item portfolio, the company must initially gathers the information related to the consumer demand, the prospective markets, the government regulations and the data related to the competitors provided in the market. If the preliminary offering proves a success, the company should go for the other markets. In this way the business would be able to implement its digital publishing program.
The development of the publishing industry is declining considering that 2008, revealing a risk to the company's long term existence, however the situation can be controlled by thinking about an advancement strategy in the future. The company 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 entryway in the brand-new markets.