Longtop Financial Technologies A Case Study Solution and Analysis
Intro
Longtop Financial Technologies A Case Study Solution is the largest publishing business with a highest market share in the China's book retail market. CMP has actually become a specialized info company and a large thorough Science and Innovation publishing business through the combination of print media, audio-visual media and the network media.
Critical Problems
CMP has actually spent its 60 years journey smoothly, being an effective publishing house, however, the changing macro market patterns and forces bring specific difficulties to the publishing market in general and Longtop Financial Technologies A Case Study Analysis in specific. These factors consist of;
• Entrance of the brand-new publishing firms in the industry.
• Declining development of the publishing market.
• Market saturation.
• Introduction of digital publishing strategies
• Enhancement of science and innovation.
The improvement of the macro markets have raised a number of questions to the management at CPM that what could be the future of CMP in this scenario? Do the long important experience, technical resources and the abilities of the business could be utilized to pursue the future development unceasingly? How could the business sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Longtop Financial Technologies A Case Study Analysis has specific strengths that can be utilized to decrease the hazards, conquer the weak point and get the opportunities. Strengths of CMP are offered as follows;
• The long term experience of Longtop Financial Technologies A Case Study Help in the publishing industry i.e. 60 years enables the company to provide high quality products at a lower cost utilizing its prior experiences.
• The technical resources and abilities generated by its successful journey provide a competitive benefit to CMP.
• Huge product portfolioof CMP helps it to diversify its risk and provide high value to its consumers.
• Strong monetary position permits the business to consider several development chances with no worry of raising fund externally.
Weaknesses
Together with the strengths, the business has certain weak points which might increase constraints for the company in executing its development program. The weak points of Longtop Financial Technologies A Case Study Solution are given as follows;
• Despite of being a science and innovation publishing company, 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 specific expansion strategies to prevent its reliance over the Chinese markets to achieve long term growth.
Opportunities
Although, the development of the publishing market is declining considering that 2008, impacting Longtop Financial Technologies A Case Study Help also, but the development might be revived by availing certain chances presented in the market. The marketplace chances for CMP consist of;
• The business could likewise introduce Digital Publishing by utilizing 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 reduce its reliance over Chinese markets by utilizing its large financial resources.
Dangers
The altering macro trends in the market and increasing competitors in the publishing market has actually postured particular dangers to Longtop Financial Technologies A Case Study Solution consisting of;( Gurel, 2017).
• Introduction of digital publishing i.e. digital libraries might lead to declining market share of Longtop Financial Technologies A Case Study Analysis due to the customer shift towards virtual libraries.
• The existence of a great deal of rivals in the publishing industry increase the risk for CMP to lose its competitive position in the market, as competitors can gain a strong consumer base by utilizing specific methods like aggressive promo, quality products, and so on
• Entrance of brand-new publishing companies in the industry along with presence of high competition increases the threat of losing the client base.
Monetary Analysis.
Due to lack of information, the financial ratios of CMP might not be computed. It might be evaluated from the Appendix III that the annual total incomes of Longtop Financial Technologies A Case Study Analysis during the duration 2000-2012 are growing at a high growth rate, showing that the annual need of the products of CMP is growing and the business is quite efficient in attracting a large number of consumers at a potential price.
Together with it, the 2nd graph which reveals the annual development in the Longtop Financial Technologies A Case Study Solution total possessions, shows that the company is rather effective in adding value to its assets through its earnings. The growth in properties shows that the overall worth of the company is also increasing with increasing the total incomes. (Unidentified, 2013).
Another monetary analysis of the business utilizing the provided data could be the analysis regarding the distribution of total profits of the business. Huge part of the profits of CMP comes from the sales of its released books i.e. 64% as shown in the Case Appendix V. The company might move towards other company sections with a potential growth to achieve its future advancement goal.
PESTEL Analysis
PESTEL analysis might be performed to learn the numerous external forces affecting the efficiency of the business and the current patterns in the external environment of the business. A short PESTEL analysis of the company is provided as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a substantial effect on the mindset of individuals about the communist ideology of the federal government, for that reason, the publishing sector is extremely monitored and guided by the Promotion Department of the Communist Party of China. Therefore, it could be said that the overall political forces impacting Longtop Financial Technologies A Case Study Solution organisation are high. The federal government policies regarding the publishing sector are likewise increasing with the passage of time.
Economical.
Economic forces affecting the publishing sector in general and the CMP in particular includesthe prices of paper, the earnings level of customers, the inflation rate, and the total GDP development of the nation. All these forces combine effect the need for the publishing market.
Social and Demographical.
The customer choices are shifting towards digital publishing rather than the conventional was of publishing. In this regard, CMP should focus on digital publishing to fulfill the changing customer choices.
Technological.
Technological forces impacting the CMP consist of the technological advancement in the reading techniques etc. Enhancement of science and innovation together with the increase of digital publishing could decrease the need for the CMP products, if certain actions would not be taken quickly.
Environmental.
Environmental forces impacting Longtop Financial Technologies A Case Study Solution includes 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 disposable and the ink utilized while publishing ought to not be harmful for the environment.
Legal.
Legal guidelines for the publishing sector at whole are high. Publishing Ordinance 1997 requires the publishers to be authorized first by the Federal government to be entered in the publishing market.
Industry Analysis (Porter's Five Forces Model).
Porter's Five Forces Model could be used to examine the appearance of the publishing industry China. A quick analysis of the Porter's 5 Forces is offered as follows;.
Threat of New Entrants.
Threats of brand-new entrants in the Chinese Publishing Market is moderate. The prospective growth in the industry tends to attract brand-new entrants to the publishing market. The presence of extreme competitors and the requirement of huge capital tends to demotivate new entrants to enter in the market.
Danger of Replacement.
Risk of Alternative is high for the Chinese Publishing Market. The replacement products for the published documents is the documents provided in the virtual libraries on particular sites. The altering consumer choices towards digital knowing increase the risk of replacement for the market.
Competitive Rivalry.
Competitive competition 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. Along with it, new entrants are likewise participating in the market increasing the competitors for CMP.
Bargaining Power of Supplier.
The major suppliers of the Longtop Financial Technologies A Case Study Solution 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.
Haggling power of buyer 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 buyers requires high quality documents at competitive costs.
Competitors Analysis.
CMP operates in a highly competitive market with the presence of a great deal of competitors. However, the business has a competitive position in the market with the greatest market share in the Chinese publishing market. Significant competitors of Longtop Financial Technologies A Case Study Solution consist of;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIP acts as a hazard for CMP as it could 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 present market scenario.
Posts and telecommunication Press (PTP).
It was likewise established in the exact same duration as Longtop Financial Technologies A Case Study Analysis and CIP. It is also one of the prominent players in the publishing market with a yearly overall revenues of RMB 550 million in 2010.
Alternatives
Alternative-1: Expand towards New Markets
Pros
• Reducing reliance over the Chinese markets.
• Increasing number of Consumers
• Growth chances.
• Avoiding the effect of market saturation in the Chinese publishing market.
Cons
• Use of potential resources in expansion.
• Risk of failure in new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
Pros
• Sustaining customer base.
• Approaching new markets.
• Easy to present utilizing current capabilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased product portfolio provides high worth to clients.
Cons
• Competitors in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core company sectors to the new one can lead the business to lose need of its products in the market.
Suggestions
With the deep analysis of the external and internal environment of the company along with the industry analysis and the rival analysis, Alternative 2 is recommended to CMP to achieve its future advancement. As the choices are shifting towards digital publishing and the business require an immediate solution to avoid the decreasing industry development. For that reason, intro of digital publishing might prove to be an immediate option with low quantity of threat for the business. The business could also consider the growth program after the success of its digital publishing program.
Application
In order to present digital publishing in its item portfolio, the company should first gathers the information related to the consumer need, the prospective markets, the government regulations and the information related to the rivals provided in the market. If the preliminary offering shows a success, the company needs 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 decreasing given that 2008, revealing a hazard to the company's long term existence, however the situation can be controlled by thinking about a development plan in the future. The company might think about presenting digital publishingin its existing market to implement its development program at immediate basis and to prevent the threat of failure for entrance in the new markets.
