Itau Unibanco B The Merger Outcome Case Study Solution and Analysis
Intro
Itau Unibanco B The Merger Outcome Case Study Help 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. Major organisation segments of the company include; books, regulars, consultancy and distribution. The business has a vast product portfolio and its major items include books, periodicals, online media, exhibitions, research reports and so on. Itau Unibanco B The Merger Outcome Case Study Help has ended up being a specialized information service provider and a big comprehensive Science and Technology publishing business through the combination of print media, audio-visual media and the network media.
Critical Issues
Although, Itau Unibanco B The Merger Outcome Case Study Analysis has invested its 60 years journey efficiently, being an effective publishing home, nevertheless, the altering macro market patterns and forces bring particular difficulties to the publishing industry in basic and CMP in particular. These aspects include;
• Entryway of the new publishing firms in the industry.
• Declining development of the publishing market.
• Market saturation.
• Intro of digital publishing methods
• Enhancement of science and technology.
The change of the macro markets have raised numerous concerns to the management at CPM that what could be the future of CMP in this scenario? 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 business sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Itau Unibanco B The Merger Outcome Case Study Solution has specific strengths that can be used to minimize the hazards, conquer the weak point and avail the chances. Strengths of CMP are given as follows;
• The long term experience of Itau Unibanco B The Merger Outcome Case Study Help in the publishing market i.e. 60 years allows the business to offer high quality items at a lower cost utilizing its previous experiences.
• The technical resources and abilities produced by its successful journey supply a competitive benefit to CMP.
• Vast item portfolioof CMP assists it to diversify its risk and provide high value to its customers.
• Strong monetary position enables the company to think about a number of advancement chances without any fear of raising fund externally.
Weak points
Along with the strengths, the company has specific weak points which might increase constraints for the business in implementing its advancement program. The weaknesses of Itau Unibanco B The Merger Outcome Case Study Help are given as follows;
• Despite of being a science and technology publishing firm, the company still has conventional ways ofpublishing which are not compatible with the growing technological shift.
• CMP highly relies over the Chinese markets for its development. It must propose certain growth strategies to avoid its dependence over the Chinese markets to achieve long term development.
Opportunities
The growth of the publishing market is decreasing given that 2008, impacting Itau Unibanco B The Merger Outcome Case Study Analysis as well, however the growth might be revived by availing particular opportunities presented in the market. The market opportunities for CMP include;
• The business might likewise introduce Digital Publishing by using its long term technical experience and a strong client acknowledgment in the market.
• CMP might consider an advancement program through the expansion towards foreign markets in order to minimize its dependence over Chinese markets by using its vast financial resources.
Risks
The changing macro patterns in the market and increasing competitors in the publishing market has postured particular dangers to Itau Unibanco B The Merger Outcome Case Study Analysis including;( Gurel, 2017).
• Intro of digital publishing i.e. virtual libraries could result in declining market share of Itau Unibanco B The Merger Outcome Case Study Analysis due to the customer shift towards digital libraries.
• The existence of large number of rivals in the publishing industry increase the risk for CMP to lose its competitive position in the market, as competitors can acquire a strong consumer base by utilizing specific techniques like aggressive promo, quality products, etc.
• Entrance of brand-new publishing firms in the market along with presence of high competition increases the hazard of losing the client base.
Financial Analysis.
The company has a quite competitive monetary performance. Due to lack of information, the monetary ratios of CMP could not be calculated. The overall monetary efficiency of the company might be examined by using the charts given in the case Appendices. It might be analyzed from the Appendix III that the yearly overall profits of CMP during the period 2000-2012 are growing at a high growth rate, showing that the yearly demand of the products of Itau Unibanco B The Merger Outcome Case Study Help is growing and the company is quite effective in drawing in a large number of clients at a potential rate.
In addition to it, the second graph which shows the annual development in the Itau Unibanco B The Merger Outcome Case Study Analysis total properties, reveals that the business is rather efficient in including value to its possessions through its revenues. The development in assets shows that the total worth of the firm is also increasing with increasing the overall revenues. (Unidentified, 2013).
Another financial analysis of the business using the given data could be the analysis regarding the circulation of overall incomes of the company. Huge part of the profits of CMP originates from the sales of its released books i.e. 64% as shown in the Case Appendix V. The business might move towards other business sectors with a prospective growth to attain its future development goal.
PESTEL Analysis
PESTEL analysis could be conducted to learn the various external forces impacting the efficiency of the company and the recent trends in the external environment of the company. A quick PESTEL analysis of the company is provided as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a substantial impact on the state of mind of the people about the communist ideology of the federal government, for that reason, the publishing sector is highly supervised and guided by the Promotion Department of the Communist Party of China. It could be said that the total political forces impacting CMP company are high. The government policies regarding the publishing sector are likewise increasing with the passage of time.
Affordable.
Financial forces impacting the publishing sector in general and the Itau Unibanco B The Merger Outcome Case Study Solution in particular includesthe costs 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 financial policies connected to the import of books affect the total company at CPM. China's financial conditions are quite beneficial for CMP with high GDP growth and consumer income level.
Social and Demographical.
Social and demographical forces include the population growth, the consumer's choices towards checking out helpful materials and so on. China has the highest population worldwide with a high population growth, revealing the increasing variety of customers of the Itau Unibanco B The Merger Outcome Case Study Analysis. Nevertheless, the customer choices are moving towards digital publishing instead of the conventional was of publishing. In this regard, CMP needs to concentrate on digital publishing to meet the altering customer choices.
Technological.
Technological forces impacting the CMP include the technological development in the reading strategies and so on. Enhancement of science and innovation in addition to the rise of digital publishing could reduce the demand for the CMP products, if specific actions would not be taken soon.
Environmental.
Ecological forces impacting Itau Unibanco B The Merger Outcome Case Study Help 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 non reusable and the ink used while publishing must not be hazardous for the environment.
Legal.
Legal policies for the publishing sector at whole are high. The legal regulations concerning the publishing sector is managed by the General Administration of Press and Publication. Publishing Ordinance 1997 requires the publishers to be approved initially by the Government to be gone into in the publishing market. The ordinance prohibits direct participation of foreign entities and people in the publishing sector.
Industry Analysis (Porter's Five Forces Model).
Porter's Five Forces Design might be used to examine the appearance of the publishing industry China. A short analysis of the Porter's Five Forces is provided as follows;.
Risk of New Entrants.
Threats of brand-new entrants in the Chinese Publishing Industry is moderate. The potential growth in the industry tends to attract brand-new entrants to the publishing industry. However, the presence of extreme competition and the requirement of substantial capital tends to demotivate new entrants to enter in the marketplace.
Threat of Alternative.
Hazard of Substitution is high for the Chinese Publishing Industry. The substitute products for the published documents is the documents presented in the digital libraries on specific websites. The changing customer preferences towards digital knowing increase the danger of replacement for the market.
Competitive Rivalry.
Competitive competition in the publishing industry is high. The presence of a great deal of consumers in the Chinese Publishing Industry like CIP, PTP and so on tends to produce high competitive rivalry for CMP. Together with it, new entrants are likewise entering into the market increasing the competition for CMP.
Bargaining Power of Provider.
The major suppliers of the Itau Unibanco B The Merger Outcome Case Study Solution consist of the suppliers of the paper for publishing files. As CMP is the largest publisher in the Chinese Publishing Market, therefore the overall bargaining power of supplier for CMP is low.
Bargaining Power of Buyer.
Bargaining 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 purchasers requires high quality documents at competitive costs.
Rivals Analysis.
CMP runs in an extremely competitive market with the existence 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 competitors of Itau Unibanco B The Merger Outcome Case Study Solution include;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIP acts as a hazard 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 quickly in the existing market situation.
Posts and telecommunication Press (PTP).
Another close competitor of CMP is PTP. It was also founded in the same duration as CMP and CIP. It ranks sixth in the state-owned publishers in terms of service scale. It is likewise one of the prominent gamers in the publishing industry with a yearly total earnings of RMB 550 million in 2010.
Alternatives
Alternative-1: Expand towards New Markets
Pros
• Minimizing reliance over the Chinese markets.
• Increasing number of Clients
• Development chances.
• Preventing the impact of market saturation in the Chinese publishing market.
Cons
• Usage of potential resources in growth.
• Danger of failure in brand-new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining consumer base.
• Approaching new markets.
• Easy to introduce using existing abilities.
• Low risk of Failure.
• Low requirement for funds.
• Increased product portfolio offers high value to consumers.
Cons
• Competition in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core business segments to the brand-new one can lead the company to lose need of its products in the market.
Suggestions
With the deep analysis of the internal and external environment of the business together with the market analysis and the rival analysis, Alternative 2 is advised to CMP to achieve its future advancement. As the preferences are shifting towards digital publishing and the company need an instant option to prevent the declining market growth. Introduction of digital publishing could prove to be an immediate solution with low amount of risk for the company. The company might likewise consider the expansion program after the success of its digital publishing program.
Application
In order to present digital publishing in its item portfolio, the company ought to first collects the information related to the consumer demand, the prospective markets, the federal government policies and the information related to the rivals provided in the market. If the initial offering shows a success, the business needs to go for the other markets. In this way the business would be able to execute its digital publishing program.
Conclusion
The growth of the publishing market is decreasing because 2008, revealing a risk to the company's long term presence, but the circumstance can be controlled by thinking about an advancement plan in the future. The business might think about introducing digital publishingin its existing market to execute its development program at immediate basis and to avoid the risk of failure for entrance in the new markets.
