Magic Timber Steel Investment Evaluation With Net Present Value Case Study Solution and Analysis
Introduction
Magic Timber Steel Investment Evaluation With Net Present Value Case Study Analysis is the largest publishing business with a greatest market share in the China's book retail market. CMP supplies a variety of services consisting of; collecting information, processing details and communication services. Significant company segments of the business include; books, periodicals, consultancy and circulation. The business has a large product portfolio and its significant products consist of books, periodicals, online media, exhibits, research study reports and so on. Magic Timber Steel Investment Evaluation With Net Present Value Case Study Help has actually become a specialized info service provider and a big extensive Science and Technology publishing business through the combination of print media, audio-visual media and the network media.
Critical Issues
CMP has spent its 60 years journey efficiently, being an effective publishing house, however, the altering macro market trends and forces bring particular difficulties to the publishing market in general and Magic Timber Steel Investment Evaluation With Net Present Value Case Study Solution in specific. These factors include;
• Entryway of the brand-new publishing firms in the market.
• Declining growth of the publishing market.
• Market saturation.
• Intro of digital publishing strategies
• 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 used to pursue the future advancement unceasingly? How could the company sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Magic Timber Steel Investment Evaluation With Net Present Value Case Study Analysis has certain strengths that can be used to lower the dangers, get rid of the weak point and obtain the chances. Strengths of CMP are provided as follows;
• The long term experience of Magic Timber Steel Investment Evaluation With Net Present Value Case Study Solution in the publishing industry i.e. 60 years enables the business to offer high quality items at a lower cost using its prior experiences.
• The technical resources and capabilities generated by its successful journey supply a competitive benefit to CMP.
• Vast item portfolioof CMP assists it to diversify its risk and offer high value to its consumers.
• Strong financial position permits the business to consider a number of advancement opportunities with no fear of raising fund externally.
Weak points
Along with the strengths, the business has particular weak points which could increase constraints for the company in executing its development program. The weak points of Magic Timber Steel Investment Evaluation With Net Present Value Case Study Help are provided as follows;
• Despite of being a science and innovation publishing firm, the business still has conventional ways ofpublishing which are not compatible with the growing technological shift.
• CMP extremely relies over the Chinese markets for its development. It ought to propose certain expansion strategies to avoid its reliance over the Chinese markets to accomplish long term growth.
Opportunities
Although, the development of the publishing market is decreasing because 2008, affecting Magic Timber Steel Investment Evaluation With Net Present Value Case Study Solution too, however the growth might be revived by availing particular opportunities presented in the market. The market chances for CMP consist of;
• The company might also introduce Digital Publishing by using its long term technical experience and a strong customer recognition in the market.
• CMP might think about a development program through the growth towards foreign markets in order to lower its dependence over Chinese markets by utilizing its huge funds.
Hazards
The altering macro trends in the market and increasing competition in the publishing industry has postured specific threats to Magic Timber Steel Investment Evaluation With Net Present Value Case Study Solution including;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries might result in declining market share of Magic Timber Steel Investment Evaluation With Net Present Value Case Study Solution due to the consumer shift towards virtual libraries.
• The presence 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 get a strong customer base by utilizing certain methods like aggressive promotion, quality products, etc.
• Entrance of new publishing companies in the market along with existence of high competitors increases the threat of losing the customer base.
Financial Analysis.
The business has a rather competitive monetary performance. Due to lack of data, the monetary ratios of CMP might not be computed. However, the overall monetary performance of the company might be examined by using the charts given up the case Appendices. It might be analyzed from the Appendix III that the yearly total profits of CMP during the duration 2000-2012 are growing at a high growth rate, revealing that the yearly need of the items of Magic Timber Steel Investment Evaluation With Net Present Value Case Study Help is growing and the company is quite efficient in bring in a a great deal of consumers at a possible price.
Along with it, the 2nd chart which shows the yearly growth in the Magic Timber Steel Investment Evaluation With Net Present Value Case Study Solution overall possessions, shows that the business is quite efficient in including worth to its possessions through its earnings. The development in possessions reveals that the total worth of the company is likewise increasing with increasing the overall revenues. (Unknown, 2013).
Another monetary analysis of the business using the offered information might be the analysis concerning the distribution of total revenues of the business. Huge part of the incomes 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 company sectors with a prospective development to achieve its future advancement goal.
PESTEL Analysis
PESTEL analysis could be performed to learn the various external forces affecting the efficiency of the business and the recent patterns in the external environment of the company. A quick PESTEL analysis of the company is provided as follows; (Alanzi, 2018).
Political.
As the publishing sector could have a considerable influence on the frame of mind of individuals about the communist ideology of the federal government, for that reason, the publishing sector is highly supervised and directed by the Publicity Department of the Communist Celebration of China. It could be said that the overall political forces affecting CMP service are high. The government policies concerning the publishing sector are likewise 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 total GDP growth of the country. All these forces combine effect the demand for the publishing market.
Social and Demographical.
The consumer choices are moving towards digital publishing rather than the standard was of publishing. In this regard, CMP ought to focus on digital publishing to fulfill the altering customer choices.
Technological.
Technological forces affecting the CMP consist of the technological improvement in the reading techniques etc. Improvement of science and innovation along with the increase of digital publishing might minimize the need for the CMP products, if particular actions would not be taken quickly.
Environmental.
Environmental forces affecting Magic Timber Steel Investment Evaluation With Net Present Value Case Study Help consists of the concerns of ecological communities over the usage of paper in publishing books. The paper utilized in the books while publishing is needed to be non reusable and the ink utilized while publishing must not be harmful for the environment.
Legal.
Legal guidelines for the publishing sector at whole are high. The legal guidelines concerning 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 forbids direct participation of foreign entities and people in the publishing sector.
Market Analysis (Porter's 5 Forces Design).
Porter's Five Forces Design might be used to analyze the attractiveness of the publishing market China. A brief analysis of the Porter's Five Forces is offered as follows;.
Risk of New Entrants.
Dangers of brand-new entrants in the Chinese Publishing Market is moderate. The potential development in the market tends to draw in new entrants to the publishing market. Nevertheless, the presence of intense competition and the requirement of big capital tends to demotivate brand-new entrants to enter in the market.
Danger of Replacement.
Risk of Substitution is high for the Chinese Publishing Industry. The substitute items for the published documents is the files provided in the virtual libraries on certain websites. The changing consumer preferences towards digital learning increase the danger of substitution for the market.
Competitive Rivalry.
Competitive rivalry in the publishing industry is high. The presence of a great deal of customers in the Chinese Publishing Industry like CIP, PTP etc. tends to produce high competitive competition for CMP. In addition to it, brand-new entrants are also participating in the marketplace increasing the competitors for CMP.
Bargaining Power of Supplier.
The significant suppliers of the Magic Timber Steel Investment Evaluation With Net Present Value Case Study Analysis consist of the providers of the paper for publishing files. As CMP is the biggest publisher in the Chinese Publishing Market, for that reason the general bargaining power of supplier for CMP is low.
Bargaining Power of Purchaser.
Bargaining power of purchaser in the publishing industry is high. Due to the existence of a large number of publishers in the Chinese market and the market saturation, the purchasers needs high quality files at competitive prices.
Competitors Analysis.
CMP operates in an extremely competitive market with the presence of large number of rivals. Nevertheless, the business has a competitive position in the market with the greatest market share in the Chinese publishing market. Significant competitors of Magic Timber Steel Investment Evaluation With Net Present Value Case Study Help consist of;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIPis one of the close competitors of CMP. Founded in the very same duration, CIP releases similar kind of books. For a big period, CIP held the biggest market share, and still ranks third and second in numerous market sections, with a significant concentrate on academic 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 could wean the marketplace share of Magic Timber Steel Investment Evaluation With Net Present Value Case Study Solution quickly in the current market circumstance.
Posts and telecommunication Press (PTP).
Another close rival of CMP is PTP. It was also founded in the exact same period as CMP and CIP. It ranks sixth in the state-owned publishers in terms of organisation scale. It is also among the popular players in the publishing industry with a yearly total profits of RMB 550 million in 2010.
Alternatives
Alternative-1: Expand towards New Markets
Pros
• Minimizing reliance over the Chinese markets.
• Increasing variety of Customers
• Development chances.
• Preventing the effect of market saturation in the Chinese publishing industry.
Cons
• Usage of potential resources in growth.
• Risk of failure in brand-new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
Pros
• Sustaining customer base.
• Approaching new markets.
• Easy to introduce using present capabilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased item portfolio offers high value to consumers.
Cons
• Competitors in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core business segments to the brand-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 together with the industry analysis and the rival analysis, Alternative 2 is recommended to CMP to achieve its future development. As the preferences are moving towards digital publishing and the company require an instant solution to prevent the decreasing industry development. Intro of digital publishing might show to be an immediate service with low quantity of danger for the business. The business could also consider the growth program after the success of its digital publishing program.
Execution
In order to present digital publishing in its product portfolio, the business should first collects the data related to the consumer need, the prospective markets, the government policies and the data related to the rivals provided in the market. If the preliminary offering proves a success, the business must go for the other markets. In this method the company would be able to execute its digital publishing program.
Conclusion
Although, the growth of the publishing industry is declining given that 2008, showing a threat to the company's long term existence, but the scenario can be managed by considering an advancement plan in the future. The business might think about presenting digital publishingin its existing market to implement its development program at instant basis and to prevent the danger of failure for entrance in the new markets.
