Lufa Farms 2 Case Study Solution and Analysis
Introduction
Lufa Farms 2 Case Study Solution is the largest publishing business with a highest market share in the China's book retail market. CMP offers a number of services including; collecting info, processing information and communication services. Major company sections of the company include; books, regulars, consultancy and circulation. The company has a vast item portfolio and its major items include books, regulars, online media, exhibitions, research study reports and so on. Lufa Farms 2 Case Study Solution has become a specialized details supplier and a large thorough Science and Technology publishing business through the combination of print media, audio-visual media and the network media.
Critical Concerns
Although, Lufa Farms 2 Case Study Solution has actually invested its 60 years journey efficiently, being an effective publishing house, however, the changing macro market patterns and forces bring particular challenges to the publishing industry in basic and CMP in particular. These factors consist of;
• Entryway of the brand-new publishing firms in the industry.
• Declining development of the publishing market.
• Market saturation.
• Introduction of digital publishing methods
• Enhancement of science and technology.
The transformation of the macro markets have raised several 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 abilities of the business could be utilized to strive for the future advancement unceasingly? How could the company sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Lufa Farms 2 Case Study Help has particular strengths that can be used to lower the dangers, conquer the weak point and get the chances. Strengths of CMP are given as follows;
• The long term experience of Lufa Farms 2 Case Study Analysis in the publishing market i.e. 60 years allows the business to supply high quality products at a lower expense utilizing its prior experiences.
• The technical resources and abilities created by its successful journey provide a competitive advantage to CMP.
• Vast product portfolioof CMP helps it to diversify its danger and offer high value to its clients.
• Strong monetary position allows the company to think about numerous advancement chances with no worry of raising fund externally.
Weak points
Along with the strengths, the company has particular weaknesses which might increase constraints for the company in executing its development program. The weak points of Lufa Farms 2 Case Study Help are provided as follows;
• Despite of being a science and technology publishing company, the business still has traditional ways ofpublishing which are not suitable with the growing technological shift.
• CMP extremely relies over the Chinese markets for its growth. It must propose certain expansion plans to avoid its dependence over the Chinese markets to attain long term development.
Opportunities
The development of the publishing industry is declining given that 2008, impacting Lufa Farms 2 Case Study Solution as well, however the growth might be restored by availing specific chances presented in the market. The market chances for CMP include;
• The company might likewise introduce Digital Publishing by using its long term technical experience and a strong customer acknowledgment in the market.
• CMP might think about an advancement program through the growth towards foreign markets in order to minimize its reliance over Chinese markets by using its huge financial resources.
Threats
The altering macro patterns in the market and increasing competition in the publishing market has actually posed certain hazards to Lufa Farms 2 Case Study Help including;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries could lead to decreasing market share of Lufa Farms 2 Case Study Analysis due to the consumer shift towards digital libraries.
• The existence of large number of rivals in the publishing market increase the risk for CMP to lose its competitive position in the market, as competitors can gain a strong consumer base by utilizing certain methods like aggressive promo, quality items, and so on
• Entrance of new publishing companies in the market along with existence of high competition increases the hazard of losing the consumer base.
Financial Analysis.
The business has a quite competitive financial performance. Due to absence of data, the financial ratios of CMP might not be determined. The general monetary efficiency of the company might be analyzed by using the charts offered in the case Appendices. It could be evaluated from the Appendix III that the annual total revenues of CMP during the duration 2000-2012 are growing at a high development rate, revealing that the annual need of the items of Lufa Farms 2 Case Study Help is growing and the business is rather effective in attracting a large number of clients at a possible cost.
Together with it, the 2nd graph which shows the yearly growth in the Lufa Farms 2 Case Study Solution total properties, reveals that the company is quite efficient in adding value to its assets through its revenues. The development in properties shows that the overall worth of the firm is also increasing with increasing the total profits. (Unknown, 2013).
Another financial analysis of the company utilizing the provided data could be the analysis concerning the circulation of total incomes of the company. Major part of the revenues of CMP comes from the sales of its released books i.e. 64% as displayed in the Case Appendix V. The company could move towards other organisation sectors with a prospective growth to accomplish its future development objective.
PESTEL Analysis
PESTEL analysis could be conducted to find out the different external forces affecting the performance of the business and the recent trends in the external environment of the company. A quick PESTEL analysis of the company is offered as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a substantial influence on the state of mind of individuals about the communist ideology of the federal government, therefore, the publishing sector is extremely supervised and directed by the Publicity Department of the Communist Celebration of China. Therefore, it might be said that the total political forces impacting Lufa Farms 2 Case Study Analysis business are high. The government policies regarding the publishing sector are also increasing with the passage of time.
Affordable.
Financial forces impacting the publishing sector in basic and the Lufa Farms 2 Case Study Analysis 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 integrate impact the demand for the publishing market. Along with it, the financial policies connected to the import of books impact the general company at CPM. However, China's financial conditions are rather favorable for CMP with high GDP development and consumer earnings level.
Social and Demographical.
Social and demographical forces consist of the population development, the customer's preferences towards reading useful materials and so on. China has the greatest population in the world with a high population growth, showing the increasing variety of consumers of the Lufa Farms 2 Case Study Solution. The customer preferences are shifting towards digital publishing rather than the conventional was of publishing. In this regard, CMP ought to focus on digital publishing to fulfill the altering customer preferences.
Technological.
Technological forces affecting the CMP consist of the technological improvement in the reading methods and so on. Enhancement of science and technology together with the increase of digital publishing might reduce the demand for the CMP products, if certain actions would not be taken soon.
Environmental.
Ecological forces impacting Lufa Farms 2 Case Study Solution consists of the issues of ecological communities over the usage of paper in publishing books. The paper used in the books while publishing is required to be disposable and the ink utilized while publishing ought to not be damaging for the environment.
Legal.
Legal regulations for the publishing sector at whole are high. Publishing Regulation 1997 needs the publishers to be approved first by the Federal government to be gone into in the publishing market.
Market Analysis (Porter's 5 Forces Design).
Porter's 5 Forces Model might be utilized to examine the beauty of the publishing market China. A brief analysis of the Porter's 5 Forces is provided as follows;.
Danger of New Entrants.
Risks of new entrants in the Chinese Publishing Market is moderate. The possible growth in the market tends to attract new entrants to the publishing market. Nevertheless, the presence of extreme competition and the requirement of big capital tends to demotivate new entrants to go into in the market.
Hazard of Substitution.
Risk of Alternative is high for the Chinese Publishing Industry. The substitute products for the released files is the files presented in the virtual libraries on specific websites. The changing consumer choices towards digital knowing increase the risk of alternative for the market.
Competitive Competition.
Competitive rivalry in the publishing market is high. The presence of large number of customers in the Chinese Publishing Industry like CIP, PTP etc. tends to produce high competitive rivalry for CMP. Together with it, new entrants are also participating in the market increasing the competitors for CMP.
Bargaining Power of Supplier.
The significant providers of the Lufa Farms 2 Case Study Analysis include the providers of the paper for publishing documents. As CMP is the biggest publisher in the Chinese Publishing Market, for that reason the total bargaining power of provider for CMP is low.
Bargaining Power of Purchaser.
Bargaining power of buyer in the publishing market is high. Due to the presence of a large number of publishers in the Chinese market and the market saturation, the buyers needs high quality documents at competitive prices.
Rivals Analysis.
CMP runs in a highly competitive industry 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 competitors of Lufa Farms 2 Case Study Solution consist of;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIPis among the close rivals of CMP. Established in the exact same duration, CIP publishes similar kind of books. For a large period, CIP held the largest market share, and still ranks second and third in different market segments, with a major focus on instructional publications. CIP serves as a threat for CMP as it might wean its market share due to its long term competitive background. CIP is concentrated on digital publishing and might wean the marketplace share of Lufa Farms 2 Case Study Help easily in the current market situation.
Posts and telecommunication Press (PTP).
It was likewise founded in the same duration as Lufa Farms 2 Case Study Analysis and CIP. It is also one of the popular gamers in the publishing industry with an annual overall revenues of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Decreasing reliance over the Chinese markets.
• Increasing variety of Consumers
• Development chances.
• Avoiding the impact of market saturation in the Chinese publishing industry.
Cons
• Usage of potential resources in growth.
• Risk of failure in new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
Pros
• Sustaining consumer base.
• Approaching new markets.
• Easy to present utilizing present capabilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased item portfolio supplies high worth to customers.
Cons
• Competitors in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core service sectors to the new one can lead the company to lose need of its items in the market.
Recommendations
With the deep analysis of the external and internal environment of the business in addition to the industry analysis and the competitor analysis, Alternative 2 is advised to CMP to attain its future development. As the preferences are moving towards digital publishing and the business need an instant option to avoid the decreasing industry development. For that reason, introduction of digital publishing could show to be an immediate service with low amount of threat for the company. The business could likewise consider the growth program after the success of its digital publishing program.
Implementation
In order to introduce digital publishing in its item portfolio, the business must initially collects the data connected to the consumer need, the prospective markets, the federal government policies and the data related to the rivals provided in the market. After that, the business should decide one prospective section for its preliminary offering. It needs to gather research study that how it could separate its digital publishing from the existing rivals' products. After all the actions above the business need to opt for the preliminary offering. If the preliminary offering proves a success, the business must choose the other markets. In this method the company would have the ability to implement its digital publishing program.
Conclusion
The growth of the publishing industry is declining since 2008, showing a threat to the business's long term existence, however the circumstance can be managed by considering a development plan in the future. The company might consider presenting digital publishingin its existing market to execute its advancement program at instant basis and to prevent the danger of failure for entrance in the brand-new markets.
