Loop Capital Funding Growth In An Investment Bank Case Study Solution and Analysis
Intro
Loop Capital Funding Growth In An Investment Bank Case Study Help is the biggest publishing company with a highest market share in the China's book retail market. CMP provides a number of services including; gathering details, processing details and interaction services. Major business sectors of the company include; books, periodicals, consultancy and circulation. The business has a huge item portfolio and its significant products consist of books, periodicals, online media, exhibitions, research study reports and so on. Loop Capital Funding Growth In An Investment Bank Case Study Analysis has actually ended up being a specialized information service provider and a large thorough Science and Technology publishing business through the integration of print media, audio-visual media and the network media.
Critical Concerns
CMP has actually invested its 60 years journey efficiently, being an effective publishing home, nevertheless, the changing macro market patterns and forces bring specific obstacles to the publishing industry in basic and Loop Capital Funding Growth In An Investment Bank Case Study Analysis in particular. These elements include;
• Entrance of the new publishing firms in the market.
• Declining growth of the publishing market.
• Market saturation.
• Intro of digital publishing methods
• Enhancement of science and innovation.
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 situation? Do the long important experience, technical resources and the capabilities of the company could be used 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
Loop Capital Funding Growth In An Investment Bank Case Study Analysis has particular strengths that can be used to reduce the threats, overcome the weak point and get the chances. Strengths of CMP are provided as follows;
• The long term experience of Loop Capital Funding Growth In An Investment Bank Case Study Analysis in the publishing market i.e. 60 years permits the company to offer high quality items at a lower cost using its prior experiences.
• The technical resources and capabilities produced by its effective journey provide a competitive advantage to CMP.
• Vast product portfolioof CMP helps it to diversify its threat and offer high value to its clients.
• Strong financial position enables the company to think about a number of advancement opportunities with no worry of raising fund externally.
Weak points
Along with the strengths, the business has specific weak points which could increase constraints for the business in executing its advancement program. The weaknesses of Loop Capital Funding Growth In An Investment Bank Case Study Analysis are given as follows;
• Despite of being a science and innovation publishing company, the company still has standard methods ofpublishing which are not compatible with the growing technological shift.
• CMP highly relies over the Chinese markets for its development. It ought to propose certain growth strategies to avoid its dependence over the Chinese markets to attain long term growth.
Opportunities
Although, the development of the publishing industry is declining given that 2008, impacting Loop Capital Funding Growth In An Investment Bank Case Study Solution also, however the growth might be restored by availing particular chances provided in the market. The market chances for CMP include;
• The business might also present Digital Publishing by utilizing its long term technical experience and a strong customer acknowledgment in the market.
• CMP might consider an advancement program through the expansion towards foreign markets in order to lower its dependence over Chinese markets by using its huge funds.
Threats
The altering macro patterns in the market and increasing competitors in the publishing market has positioned particular threats to Loop Capital Funding Growth In An Investment Bank Case Study Help including;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries could lead to decreasing market share of Loop Capital Funding Growth In An Investment Bank Case Study Solution due to the consumer shift towards virtual libraries.
• The presence of a great deal of rivals in the publishing market increase the risk for CMP to lose its competitive position in the market, as rivals can acquire a strong consumer base by using particular methods like aggressive promo, quality products, etc.
• Entryway of brand-new publishing firms in the market along with presence of high competitors increases the threat of losing the client base.
Financial Analysis.
Due to absence of information, the financial ratios of CMP might not be determined. It could be analyzed from the Appendix III that the yearly overall earnings of Loop Capital Funding Growth In An Investment Bank Case Study Analysis during the period 2000-2012 are growing at a high development rate, revealing that the yearly demand of the products of CMP is growing and the company is quite efficient in drawing in a large number of consumers at a possible price.
Along with it, the 2nd graph which shows the yearly growth in the Loop Capital Funding Growth In An Investment Bank Case Study Analysis total possessions, reveals that the company is quite effective in including value to its properties through its incomes. The growth in assets shows that the total worth of the firm is likewise increasing with increasing the overall profits. (Unidentified, 2013).
Another monetary analysis of the company using the offered data could be the analysis regarding the distribution of total profits of the business. Huge 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 business sectors with a possible development to achieve its future development goal.
PESTEL Analysis
PESTEL analysis could be performed to learn the numerous external forces impacting the performance of the business and the recent trends 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 could have a substantial effect on the frame of mind of individuals about the communist ideology of the federal government, for that reason, the publishing sector is extremely monitored and assisted by the Publicity Department of the Communist Party of China. It could be said that the total 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 basic and the Loop Capital Funding Growth In An Investment Bank Case Study Help in specific includesthe costs of paper, the earnings level of consumers, the inflation rate, and the overall GDP development of the nation. All these forces combine impact the need for the publishing market. Together with it, the economic policies related to the import of books affect the overall business at CPM. China's financial conditions are quite beneficial for CMP with high GDP development and consumer earnings level.
Social and Demographical.
The consumer preferences are shifting towards digital publishing rather than the standard was of publishing. In this regard, CMP ought to focus on digital publishing to satisfy the changing customer choices.
Technological.
Technological forces affecting the CMP consist of the technological advancement in the reading methods etc. Enhancement of science and technology together with the increase of digital publishing might decrease the demand for the CMP products, if certain actions would not be taken quickly.
Environmental.
Environmental forces impacting Loop Capital Funding Growth In An Investment Bank Case Study Help includes 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 disposable and the ink utilized while publishing must not be hazardous for the environment.
Legal.
Legal guidelines for the publishing sector at whole are high. The legal regulations concerning the publishing sector is controlled by the General Administration of Press and Publication. Publishing Ordinance 1997 needs the publishers to be approved first by the Federal government to be gone into in the publishing market. The ordinance prohibits direct involvement of foreign entities and individuals in the publishing sector.
Market Analysis (Porter's 5 Forces Design).
Porter's Five Forces Design might be utilized to evaluate the beauty of the publishing industry China. A quick analysis of the Porter's Five Forces is provided as follows;.
Risk of New Entrants.
Dangers of brand-new entrants in the Chinese Publishing Market is moderate. The prospective development in the industry tends to draw in new entrants to the publishing industry. The existence of intense competitors and the requirement of huge capital tends to demotivate brand-new entrants to go into in the market.
Risk of Alternative.
Danger of Substitution is high for the Chinese Publishing Industry. The alternative products for the published files is the documents presented in the virtual libraries on certain websites. The changing consumer preferences towards digital learning increase the hazard 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 Market like CIP, PTP and so on tends to produce high competitive competition for CMP. In addition to it, brand-new entrants are also entering into the market increasing the competition for CMP.
Bargaining Power of Provider.
The significant providers of the Loop Capital Funding Growth In An Investment Bank Case Study Analysis include the suppliers of the paper for publishing files. As CMP is the largest publisher in the Chinese Publishing Market, therefore the general bargaining power of provider for CMP is low.
Bargaining Power of Purchaser.
Negotiating 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 market saturation, the buyers requires high quality files at competitive prices.
Rivals Analysis.
CMP runs in an extremely competitive market with the presence of large number of competitors. The company has a competitive position in the market with the highest market share in the Chinese publishing market. Major rivals of Loop Capital Funding Growth In An Investment Bank Case Study Solution consist of;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry 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 might 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 established in the exact same period as CMP and CIP. It ranks 6th in the state-owned publishers in terms of company scale. It is also one of the popular players in the publishing industry with a yearly total earnings of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Lowering reliance over the Chinese markets.
• Increasing variety of Customers
• Development opportunities.
• Preventing the impact of market saturation in the Chinese publishing industry.
Cons
• Usage of possible resources in expansion.
• Threat of failure in new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining consumer base.
• Approaching new markets.
• Easy to present using existing abilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased item portfolio provides 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 sections to the brand-new one can lead the company to lose demand of its items in the market.
Suggestions
With the deep analysis of the internal and external environment of the company along with the market analysis and the competitor analysis, Alternative 2 is advised to CMP to achieve its future advancement. As the preferences are moving towards digital publishing and the company require an immediate option to avoid the decreasing industry growth. Introduction of digital publishing might prove to be an immediate solution with low quantity of threat for the company. Nevertheless, the company could also consider the expansion program after the success of its digital publishing program.
Application
In order to introduce digital publishing in its product portfolio, the business ought to initially collects the information related to the consumer demand, the potential markets, the government guidelines and the data related to the competitors presented in the market. If the initial offering shows a success, the business should go for the other markets. In this method the business would be able to execute its digital publishing program.
Conclusion
Although, the growth of the publishing industry is decreasing since 2008, revealing a risk to the business's long term presence, however the scenario can be controlled by considering an advancement strategy in the future. The business might think about presenting digital publishingin its existing market to implement its advancement program at instant basis and to prevent the risk of failure for entrance in the brand-new markets.
