Keddeg Company C Succession To The Next Generation Of Small Business Case Study Solution and Analysis
Introduction
Keddeg Company C Succession To The Next Generation Of Small Business Case Study Help is the biggest publishing company with a highest market share in the China's book retail market. CMP has actually become a specialized information supplier and a big comprehensive Science and Technology publishing business through the integration of print media, audio-visual media and the network media.
Important Problems
Although, Keddeg Company C Succession To The Next Generation Of Small Business Case Study Analysis has spent its 60 years journey smoothly, being a successful publishing home, nevertheless, the changing macro market patterns and forces bring specific obstacles to the publishing industry in general and CMP in specific. These factors include;
• Entryway of the new publishing firms in the market.
• Decreasing growth of the publishing market.
• Market saturation.
• Introduction of digital publishing techniques
• Improvement of science and innovation.
The change of the macro markets have raised several 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 capabilities of the business could be used to pursue the future development unceasingly? How could the company sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Keddeg Company C Succession To The Next Generation Of Small Business Case Study Help has certain strengths that can be utilized to decrease the hazards, overcome the weak point and avail the chances. Strengths of CMP are given as follows;
• The long term experience of Keddeg Company C Succession To The Next Generation Of Small Business Case Study Analysis in the publishing industry i.e. 60 years allows the company to offer high quality items at a lower expense using its previous experiences.
• The technical resources and capabilities created by its effective journey provide a competitive advantage to CMP.
• Huge product portfolioof CMP assists it to diversify its threat and offer high value to its clients.
• Strong monetary position allows the company to consider several development opportunities without any worry of raising fund externally.
Weaknesses
Along with the strengths, the company has particular weaknesses which could increase restraints for the business in executing its development program. The weaknesses of Keddeg Company C Succession To The Next Generation Of Small Business Case Study Help are provided as follows;
• Despite of being a science and technology publishing firm, the company still has conventional ways ofpublishing which are not suitable with the growing technological shift.
• CMP highly relies over the Chinese markets for its growth. It must propose particular growth plans to prevent its dependence over the Chinese markets to accomplish long term development.
Opportunities
The development of the publishing market is decreasing given that 2008, affecting Keddeg Company C Succession To The Next Generation Of Small Business Case Study Analysis as well, however the growth might be restored by availing certain opportunities presented in the market. The marketplace opportunities for CMP consist of;
• The company could also introduce Digital Publishing by using its long term technical experience and a strong consumer acknowledgment in the market.
• CMP might consider an advancement program through the expansion towards foreign markets in order to decrease its reliance over Chinese markets by using its vast financial resources.
Risks
The altering macro trends in the market and increasing competitors in the publishing market has positioned particular dangers to Keddeg Company C Succession To The Next Generation Of Small Business Case Study Help consisting of;( Gurel, 2017).
• Intro of digital publishing i.e. virtual libraries could lead to declining market share of Keddeg Company C Succession To The Next Generation Of Small Business Case Study Help due to the customer shift towards virtual libraries.
• The existence of a great deal of competitors in the publishing market increase the hazard for CMP to lose its competitive position in the market, as rivals can acquire a strong consumer base by using certain methods like aggressive promotion, quality items, etc.
• Entryway of new publishing firms in the industry in addition to existence of high competitors increases the threat of losing the customer base.
Monetary Analysis.
Due to absence of information, the financial ratios of CMP could not be calculated. It might be analyzed from the Appendix III that the yearly overall revenues of Keddeg Company C Succession To The Next Generation Of Small Business Case Study Solution throughout 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 quite efficient in bring in a large number of customers at a possible price.
In addition to it, the second chart which shows the yearly development in the Keddeg Company C Succession To The Next Generation Of Small Business Case Study Analysis total assets, shows that the company is quite effective in adding value to its possessions through its earnings. The growth in assets reveals that the overall value of the company is also increasing with increasing the total earnings. (Unknown, 2013).
Another monetary analysis of the company utilizing the provided information might be the analysis regarding the circulation of overall incomes of the business. Major part of the revenues of CMP originates from the sales of its released books i.e. 64% as shown in the Case Appendix V. The company might move towards other organisation segments with a possible development to accomplish its future development goal.
PESTEL Analysis
PESTEL analysis could be conducted to discover the various external forces affecting the efficiency of the company and the current trends in the external environment of the company. A quick PESTEL analysis of the business is offered as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a substantial effect on the frame of mind of the people about the communist ideology of the federal government, therefore, the publishing sector is extremely supervised and directed by the Publicity Department of the Communist Party of China. It might be said that the overall political forces affecting CMP service are high. The federal government policies concerning the publishing sector are also increasing with the passage of time.
Economical.
Financial forces impacting the publishing sector in general and the Keddeg Company C Succession To The Next Generation Of Small Business Case Study Help in specific includesthe rates of paper, the income level of consumers, the inflation rate, and the general GDP development of the country. All these forces combine impact the need for the publishing market. Together with it, the economic policies associated with the import of books impact the total organisation at CPM. China's financial conditions are rather favorable for CMP with high GDP growth and customer earnings level.
Social and Demographical.
The customer choices are moving towards digital publishing rather than the standard was of publishing. In this regard, CMP must focus on digital publishing to fulfill the changing consumer choices.
Technological.
Technological forces impacting the CMP consist of the technological advancement in the reading techniques and so on. Enhancement of science and technology in addition to the increase of digital publishing could minimize the need for the CMP items, if particular actions would not be taken quickly.
Environmental.
Environmental forces affecting Keddeg Company C Succession To The Next Generation Of Small Business Case Study Solution consists of the issues of environmental communities over the use of paper in publishing books. The paper used in the books while publishing is needed to be disposable and the ink utilized while publishing must not be damaging for the environment.
Legal.
Legal policies for the publishing sector at whole are high. The legal regulations relating to the publishing sector is controlled by the General Administration of Press and Publication. Publishing Regulation 1997 requires the publishers to be authorized initially by the Federal government to be entered in the publishing market. The ordinance prohibits direct involvement of foreign entities and people in the publishing sector.
Market Analysis (Porter's Five Forces Model).
Porter's 5 Forces Model could be utilized to evaluate the beauty of the publishing market China. A brief analysis of the Porter's Five Forces is offered as follows;.
Risk of New Entrants.
Threats of new entrants in the Chinese Publishing Industry is moderate. The potential development in the industry tends to bring in brand-new entrants to the publishing industry. However, the existence of extreme competition and the requirement of substantial capital tends to demotivate new entrants to go into in the marketplace.
Danger of Alternative.
Threat of Substitution is high for the Chinese Publishing Industry. The replacement products for the published files is the files provided in the digital libraries on certain sites. The changing consumer preferences towards digital learning increase the risk of substitution for the industry.
Competitive Rivalry.
Competitive competition in the publishing industry is high. The existence of a great deal of customers 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 competitors for CMP.
Bargaining Power of Provider.
The significant providers of the Keddeg Company C Succession To The Next Generation Of Small Business Case Study Solution include the providers of the paper for publishing documents. As CMP is the biggest publisher in the Chinese Publishing Market, therefore the overall bargaining power of provider for CMP is low.
Bargaining Power of Purchaser.
Negotiating power of purchaser in the publishing market is high. Due to the presence of a large number of publishers in the Chinese market and the marketplace saturation, the purchasers needs high quality documents at competitive rates.
Competitors Analysis.
CMP runs in an extremely competitive industry with the presence of a great deal of rivals. However, the business has a competitive position in the market with the highest market share in the Chinese publishing market. Significant rivals of Keddeg Company C Succession To The Next Generation Of Small Business Case Study Analysis include;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIP acts as a threat for CMP as it could 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 existing market situation.
Posts and telecommunication Press (PTP).
It was also founded in the exact same duration as Keddeg Company C Succession To The Next Generation Of Small Business Case Study Analysis and CIP. It is also one of the popular gamers in the publishing market with an annual total earnings of RMB 550 million in 2010.
Alternatives
Alternative-1: Expand towards New Markets
Pros
• Reducing dependence over the Chinese markets.
• Increasing number of Clients
• Growth chances.
• Avoiding the impact of market saturation in the Chinese publishing industry.
Cons
• Usage of prospective resources in expansion.
• Threat of failure in new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
Pros
• Sustaining customer base.
• Approaching brand-new markets.
• Easy to introduce utilizing current capabilities.
• Low risk of Failure.
• Low requirement for funds.
• Increased product portfolio provides high value to clients.
Cons
• Competition in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core company sections to the brand-new one can lead the business to lose demand of its products in the market.
Suggestions
As the choices are moving towards digital publishing and the business require an immediate option to avoid the declining market development. The company might likewise consider the expansion program after the success of its digital publishing program.
Application
In order to introduce digital publishing in its item portfolio, the company ought to first gathers the data related to the consumer need, the prospective markets, the federal government policies and the information related to the rivals presented in the market. If the initial offering shows a success, the business needs to go for the other markets. In this method the business would be able to implement its digital publishing program.
Conclusion
Although, the development of the publishing market is declining because 2008, revealing a danger to the company's long term existence, but the circumstance can be managed by considering a development strategy 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.
