Jiuding Capital Private Equity Firm With Chinese Characteristics Case Study Solution and Analysis
Intro
Jiuding Capital Private Equity Firm With Chinese Characteristics Case Study Help is the largest publishing company with a greatest market share in the China's book retail market. CMP provides a variety of services consisting of; collecting information, processing info and interaction services. Major service segments of the company consist of; books, regulars, consultancy and distribution. The business has a large product portfolio and its major products include books, periodicals, online media, exhibits, research reports etc. Jiuding Capital Private Equity Firm With Chinese Characteristics Case Study Analysis has actually ended up being a specialized info company and a big comprehensive Science and Technology publishing business through the integration of print media, audio-visual media and the network media.
Important Issues
Although, Jiuding Capital Private Equity Firm With Chinese Characteristics Case Study Analysis has spent its 60 years journey efficiently, being an effective publishing house, however, the changing macro market trends and forces bring particular obstacles to the publishing industry in basic and CMP in particular. These elements consist of;
• Entrance of the brand-new publishing firms in the industry.
• Declining development of the publishing market.
• Market saturation.
• Introduction of digital publishing methods
• Improvement of science and technology.
The change of the macro markets have raised a number of concerns 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 capabilities of the company could be utilized 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
Jiuding Capital Private Equity Firm With Chinese Characteristics Case Study Analysis has certain strengths that can be utilized to minimize the dangers, conquer the weakness and get the chances. Strengths of CMP are provided as follows;
• The long term experience of Jiuding Capital Private Equity Firm With Chinese Characteristics Case Study Help in the publishing market i.e. 60 years allows the company to provide high quality items at a lower cost using its prior experiences.
• The technical resources and abilities created by its successful journey offer a competitive advantage to CMP.
• Large item portfolioof CMP assists it to diversify its threat and offer high value to its customers.
• Strong monetary position enables the business to consider several advancement opportunities with no fear of raising fund externally.
Weak points
Together with the strengths, the business has certain weaknesses which could increase constraints for the business in implementing its advancement program. The weak points of Jiuding Capital Private Equity Firm With Chinese Characteristics 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 needs to propose certain growth plans to avoid its reliance over the Chinese markets to attain long term growth.
Opportunities
Although, the growth of the publishing market is declining since 2008, affecting Jiuding Capital Private Equity Firm With Chinese Characteristics Case Study Solution too, however the development could be restored by availing specific chances presented in the market. The marketplace chances for CMP include;
• The business could also present Digital Publishing by using its long term technical experience and a strong client recognition in the market.
• CMP might consider an advancement program through the expansion towards foreign markets in order to reduce its dependence over Chinese markets by utilizing its huge financial resources.
Hazards
The altering macro trends in the market and increasing competitors in the publishing industry has presented particular risks to Jiuding Capital Private Equity Firm With Chinese Characteristics Case Study Help including;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries might cause decreasing market share of Jiuding Capital Private Equity Firm With Chinese Characteristics Case Study Help due to the consumer shift towards virtual libraries.
• The presence of a great deal of rivals in the publishing market increase the hazard for CMP to lose its competitive position in the market, as competitors can acquire a strong consumer base by utilizing certain methods like aggressive promo, quality products, and so on
• Entrance of new publishing firms in the industry together with presence of high competitors increases the danger of losing the client base.
Monetary Analysis.
The company has a quite competitive monetary efficiency. Due to absence of data, the monetary ratios of CMP might not be computed. Nevertheless, the total monetary efficiency of the company might be analyzed by utilizing the graphs given in the case Appendices. It might be analyzed from the Appendix III that the yearly overall revenues of CMP during the period 2000-2012 are growing at a high development rate, revealing that the annual demand of the products of Jiuding Capital Private Equity Firm With Chinese Characteristics Case Study Help is growing and the company is rather efficient in bring in a a great deal of consumers at a prospective price.
Along with it, the second chart which reveals the yearly development in the Jiuding Capital Private Equity Firm With Chinese Characteristics Case Study Help total properties, shows that the company is rather efficient in including worth to its assets through its incomes. The development in assets shows that the total worth of the company is also increasing with increasing the overall profits. (Unidentified, 2013).
Another monetary analysis of the business using the provided data might be the analysis concerning the distribution of total revenues of the company. Major part of the incomes of CMP comes from the sales of its released books i.e. 64% as shown in the Case Appendix V. The business could move towards other service segments with a possible development to accomplish its future advancement goal.
PESTEL Analysis
PESTEL analysis might be conducted to discover the different external forces affecting the efficiency of the business and the current trends in the external environment of the business. A short PESTEL analysis of the business 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 government, therefore, the publishing sector is highly monitored and guided by the Publicity Department of the Communist Celebration of China. Therefore, it could be stated that the general political forces affecting Jiuding Capital Private Equity Firm With Chinese Characteristics Case Study Help service are high. The government policies relating to the publishing sector are also increasing with the passage of time.
Affordable.
Economic forces impacting the publishing sector in basic and the CMP in particular includesthe prices of paper, the income level of customers, the inflation rate, and the overall GDP growth of the nation. All these forces combine impact the demand for the publishing market.
Social and Demographical.
Social and demographical forces include the population growth, the customer's choices towards checking out informative materials and so on. China has the greatest population in the world with a high population growth, showing the increasing number of consumers of the Jiuding Capital Private Equity Firm With Chinese Characteristics Case Study Analysis. Nevertheless, the customer preferences are moving towards digital publishing instead of 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 improvement in the reading methods and so on. Improvement of science and technology together with the rise of digital publishing could reduce the need for the CMP products, if particular actions would not be taken quickly.
Environmental.
Ecological forces impacting Jiuding Capital Private Equity Firm With Chinese Characteristics Case Study Help includes the concerns 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 regulations for the publishing sector at whole are high. The legal regulations regarding the publishing sector is managed by the General Administration of Press and Publication. Publishing Regulation 1997 needs the publishers to be approved first by the Federal government to be entered in the publishing market. The ordinance prohibits direct participation of foreign entities and people in the publishing sector.
Market Analysis (Porter's 5 Forces Design).
Porter's 5 Forces Model might be used to evaluate the attractiveness of the publishing industry China. A brief analysis of the Porter's Five Forces is offered as follows;.
Threat of New Entrants.
Risks of new entrants in the Chinese Publishing Industry is moderate. The prospective development in the industry tends to attract brand-new entrants to the publishing market. However, the presence of intense competitors and the requirement of huge capital tends to demotivate new entrants to go into in the marketplace.
Risk of Replacement.
Danger of Substitution is high for the Chinese Publishing Market. The alternative items for the published files is the files provided in the digital libraries on particular sites. The altering customer choices towards digital learning increase the danger of alternative for the market.
Competitive Rivalry.
Competitive rivalry in the publishing industry is high. The existence of large number of customers in the Chinese Publishing Industry like CIP, PTP and so on tends to produce high competitive competition for CMP. Together with it, new entrants are likewise entering into the marketplace increasing the competitors for CMP.
Bargaining Power of Provider.
The significant suppliers of the Jiuding Capital Private Equity Firm With Chinese Characteristics Case Study Analysis consist of the providers of the paper for releasing documents. As CMP is the largest publisher in the Chinese Publishing Market, for that reason the total bargaining power of supplier for CMP is low.
Bargaining Power of Buyer.
Negotiating power of purchaser in the publishing industry is high. Due to the presence of a large number of publishers in the Chinese market and the market saturation, the purchasers requires high quality files at competitive costs.
Competitors Analysis.
CMP runs in a highly competitive industry with the presence of a great deal of rivals. The business has a competitive position in the market with the highest market share in the Chinese publishing market. Significant competitors of Jiuding Capital Private Equity Firm With Chinese Characteristics Case Study Help include;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIPis among the close rivals of CMP. Founded in the exact same period, CIP releases similar type of books. For a large time period, CIP held the largest market share, and still ranks 2nd and 3rd in various market segments, with a major focus on educational publications. CIP serves as a risk for CMP as it could wean its market share due to its long term competitive background. CIP is concentrated on digital publishing and might wean the marketplace share of Jiuding Capital Private Equity Firm With Chinese Characteristics Case Study Analysis quickly in the existing market circumstance.
Posts and telecommunication Press (PTP).
It was also established in the exact same duration as Jiuding Capital Private Equity Firm With Chinese Characteristics Case Study Solution and CIP. It is likewise one of the prominent players in the publishing industry with an annual overall earnings of RMB 550 million in 2010.
Alternatives
Alternative-1: Expand towards New Markets
Pros
• Decreasing reliance over the Chinese markets.
• Increasing variety of Consumers
• Development opportunities.
• Preventing the effect of market saturation in the Chinese publishing market.
Cons
• Use of prospective resources in growth.
• Danger of failure in brand-new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining customer base.
• Approaching new markets.
• Easy to present using current abilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased item portfolio provides high value to customers.
Cons
• Competition in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core business sectors to the brand-new one can lead the business to lose need of its items in the market.
Suggestions
As the choices are moving towards digital publishing and the company need an instant service to prevent the declining market development. The company could also consider the expansion program after the success of its digital publishing program.
Implementation
In order to present digital publishing in its item portfolio, the business should first gathers the data related to the customer need, the possible markets, the federal government regulations and the information related to the competitors presented in the market. If the preliminary offering proves a success, the business ought to go for the other markets. In this way the company would be able to execute its digital publishing program.
Conclusion
The growth of the publishing industry is declining considering that 2008, showing a threat to the business's long term presence, but the circumstance can be controlled by considering an advancement strategy in the future. The business might consider introducing digital publishingin its existing market to implement its advancement program at immediate basis and to prevent the danger of failure for entryway in the brand-new markets.
