International Financial Management Case Study Solution and Analysis
Introduction
International Financial Management Case Study Analysis is the biggest publishing business with a greatest market share in the China's book retail market. CMP has actually become a specialized information provider and a large thorough Science and Innovation publishing company through the integration of print media, audio-visual media and the network media.
Vital Issues
CMP has actually spent its 60 years journey efficiently, being a successful publishing home, however, the changing macro market trends and forces bring particular difficulties to the publishing market in general and International Financial Management Case Study Help in specific. These aspects consist of;
• Entryway of the brand-new publishing companies in the industry.
• Declining development of the publishing market.
• Market saturation.
• Intro of digital publishing techniques
• Improvement of science and innovation.
The transformation of the macro markets have raised several questions 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 business could be used 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
International Financial Management Case Study Solution has specific strengths that can be used to decrease the hazards, conquer the weak point and obtain the opportunities. Strengths of CMP are given as follows;
• The long term experience of International Financial Management Case Study Solution in the publishing market i.e. 60 years allows the company to provide high quality items at a lower expense using its prior experiences.
• The technical resources and abilities produced by its effective journey provide a competitive benefit to CMP.
• Huge product portfolioof CMP assists it to diversify its danger and supply high worth to its customers.
• Strong monetary position allows the company to think about several advancement chances with no worry of raising fund externally.
Weak points
In addition to the strengths, the company has particular weak points which might increase constraints for the company in implementing its development program. The weaknesses of International Financial Management Case Study Help are provided as follows;
• Despite of being a science and technology publishing firm, the company still has traditional ways ofpublishing which are not suitable with the growing technological shift.
• CMP extremely relies over the Chinese markets for its development. It should propose particular growth plans to prevent its dependence over the Chinese markets to achieve long term growth.
Opportunities
The growth of the publishing market is declining because 2008, impacting International Financial Management Case Study Analysis as well, but the development might be restored by availing particular chances presented in the market. The marketplace opportunities for CMP consist of;
• The business could likewise introduce Digital Publishing by using its long term technical experience and a strong consumer acknowledgment in the market.
• CMP could consider a development program through the expansion towards foreign markets in order to minimize its dependence over Chinese markets by utilizing its huge funds.
Hazards
The changing macro patterns in the market and increasing competitors in the publishing industry has presented certain risks to International Financial Management Case Study Solution including;( Gurel, 2017).
• Introduction of digital publishing i.e. virtual libraries could result in declining market share of International Financial Management Case Study Analysis due to the customer shift towards virtual libraries.
• The existence of a great deal of competitors in the publishing market increase the threat for CMP to lose its competitive position in the market, as rivals can get a strong customer base by using specific methods like aggressive promo, quality items, and so on
• Entryway of brand-new publishing firms in the market together with presence of high competition increases the threat of losing the client base.
Financial Analysis.
Due to absence of data, the monetary ratios of CMP could not be determined. It could be analyzed from the Appendix III that the annual overall earnings of International Financial Management Case Study Analysis throughout 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 effective in drawing in a big number of consumers at a possible cost.
Along with it, the 2nd graph which shows the annual growth in the International Financial Management Case Study Analysis total assets, reveals that the business is rather efficient in including value to its assets through its revenues. The development in possessions reveals that the overall worth of the company is also increasing with increasing the overall profits. (Unknown, 2013).
Another monetary analysis of the business using the offered data might be the analysis relating to the circulation of total profits 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 company might move towards other business sectors with a prospective growth to accomplish its future development objective.
PESTEL Analysis
PESTEL analysis could be conducted to discover the numerous external forces affecting the efficiency of the company and the current patterns in the external environment of the company. A short PESTEL analysis of the company is given as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a substantial influence on the frame of mind of individuals about the communist ideology of the federal government, for that reason, the publishing sector is extremely supervised and guided by the Publicity Department of the Communist Party of China. For that reason, it could be stated that the total political forces impacting International Financial Management Case Study Help organisation are high. The federal government policies relating to the publishing sector are likewise increasing with the passage of time.
Cost-effective.
Financial forces affecting the publishing sector in basic and the CMP in specific includesthe prices of paper, the earnings level of customers, the inflation rate, and the total GDP growth of the country. All these forces integrate impact the need for the publishing market.
Social and Demographical.
The customer preferences are shifting towards digital publishing rather than the traditional was of publishing. In this regard, CMP needs to focus on digital publishing to satisfy the changing customer preferences.
Technological.
Technological forces impacting the CMP include the technological development in the reading methods and so on. Enhancement of science and technology along with the increase of digital publishing might reduce the need for the CMP items, if specific actions would not be taken soon.
Environmental.
Ecological forces affecting International Financial Management Case Study Analysis consists of the issues of ecological neighborhoods over the usage of paper in publishing books. The paper utilized in the books while publishing is required to be non reusable and the ink utilized while publishing should 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 Government to be gone into in the publishing market.
Industry Analysis (Porter's 5 Forces Design).
Porter's Five Forces Model could be utilized to analyze the attractiveness of the publishing industry China. A short analysis of the Porter's Five Forces is offered as follows;.
Threat of New Entrants.
Dangers of brand-new entrants in the Chinese Publishing Industry is moderate. The potential development in the industry tends to draw in brand-new entrants to the publishing market. Nevertheless, the existence of extreme competitors and the requirement of substantial capital tends to demotivate brand-new entrants to enter in the marketplace.
Risk of Substitution.
Threat of Replacement is high for the Chinese Publishing Industry. The alternative products for the published documents is the documents provided in the virtual libraries on certain websites. The changing consumer choices towards digital knowing increase the risk of alternative for the industry.
Competitive Competition.
Competitive rivalry in the publishing market is high. The presence of a great deal of consumers in the Chinese Publishing Industry like CIP, PTP etc. tends to produce high competitive competition for CMP. Together with it, new entrants are also participating in the marketplace increasing the competitors for CMP.
Bargaining Power of Provider.
The major providers of the International Financial Management Case Study Help consist of the providers of the paper for releasing documents. As CMP is the biggest publisher in the Chinese Publishing Market, for that reason the general bargaining power of supplier for CMP is low.
Bargaining Power of Purchaser.
Haggling power of buyer in the publishing market is high. Due to the presence of a a great deal of publishers in the Chinese market and the marketplace saturation, the buyers requires high quality documents at competitive costs.
Rivals Analysis.
CMP runs in a highly competitive market with the presence of a great deal of competitors. Nevertheless, the company has a competitive position in the market with the greatest market share in the Chinese publishing market. Major rivals of International Financial Management Case Study Solution consist of;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIPis among the close rivals of CMP. Established in the exact same duration, CIP releases comparable type of books. For a large time period, CIP held the biggest market share, and still ranks 3rd and second in different market sectors, with a significant concentrate on educational publications. CIP acts as a hazard for CMP as it might wean its market share due to its long term competitive background. CIP is concentrated on digital publishing and could wean the marketplace share of International Financial Management Case Study Solution easily in the present market circumstance.
Posts and telecommunication Press (PTP).
It was likewise founded in the same period as International Financial Management Case Study Help and CIP. It is likewise one of the prominent players in the publishing industry with a yearly total earnings of RMB 550 million in 2010.
Alternatives
Alternative-1: Expand towards New Markets
Pros
• Lowering dependence over the Chinese markets.
• Increasing number of Customers
• Development opportunities.
• Avoiding the impact of market saturation in the Chinese publishing industry.
Cons
• Usage of possible resources in expansion.
• Risk of failure in new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining consumer base.
• Approaching new markets.
• Easy to present using existing capabilities.
• Low risk of Failure.
• Low requirement for funds.
• Increased product portfolio offers high value to consumers.
Cons
• Competitors in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core company sections to the new one can lead the company to lose need of its items in the market.
Recommendations
As the choices are shifting towards digital publishing and the business require an immediate service to avoid the decreasing industry development. The business could also think about the expansion program after the success of its digital publishing program.
Application
In order to present digital publishing in its item portfolio, the business ought to first gathers the data related to the customer need, the prospective markets, the government regulations and the information connected to the rivals presented in the market. After that, the company ought to choose one potential section for its initial offering. It needs to collect research that how it might distinguish its digital publishing from the existing competitors' items. After all the actions above the company should choose the initial offering. If the preliminary offering shows a success, the company should opt for the other markets. In this method the business would be able to execute its digital publishing program.
Conclusion
Although, the development of the publishing industry is declining because 2008, revealing a threat to the business's long term existence, but the circumstance can be controlled by thinking about a development plan in the future. The company could consider 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 new markets.
