Magna International Inc B Case Study Solution and Analysis
Introduction
Magna International Inc B Case Study Help is the largest publishing business with a highest market share in the China's book retail market. CMP provides a number of services consisting of; gathering information, processing details and interaction services. Significant business segments of the business consist of; books, regulars, consultancy and circulation. The company has a huge item portfolio and its significant items consist of books, periodicals, online media, exhibits, research study reports etc. Magna International Inc B Case Study Help has ended up being a specialized information provider and a big detailed Science and Technology publishing business through the integration of print media, audio-visual media and the network media.
Vital Problems
CMP has actually invested its 60 years journey efficiently, being a successful publishing home, however, the changing macro market trends and forces bring particular challenges to the publishing market in general and Magna International Inc B Case Study Solution in specific. These factors consist of;
• Entrance of the new publishing firms in the market.
• Declining growth of the publishing market.
• Market saturation.
• Intro of digital publishing techniques
• Enhancement of science and innovation.
The change of the macro markets have raised several questions 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 abilities of the company could be used to strive for the future development unceasingly? How could the company sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Magna International Inc B Case Study Help has specific strengths that can be utilized to decrease the hazards, get rid of the weak point and obtain the opportunities. Strengths of CMP are provided as follows;
• The long term experience of Magna International Inc B Case Study Analysis in the publishing industry i.e. 60 years permits the business to provide high quality items at a lower cost using its prior experiences.
• The technical resources and abilities created by its effective journey supply a competitive benefit to CMP.
• Vast item portfolioof CMP helps it to diversify its threat and provide high worth to its consumers.
• Strong financial position enables the company to consider a number of development opportunities with no fear of raising fund externally.
Weaknesses
Along with the strengths, the business has specific weaknesses which might increase restraints for the company in implementing its development program. The weak points of Magna International Inc B Case Study Solution are offered 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 development. It needs to propose particular expansion strategies to avoid its dependence over the Chinese markets to achieve long term growth.
Opportunities
The growth of the publishing market is declining because 2008, affecting Magna International Inc B Case Study Help as well, but the growth could be restored by availing particular opportunities presented in the market. The marketplace opportunities for CMP consist of;
• The company might likewise introduce Digital Publishing by utilizing its long term technical experience and a strong customer recognition in the market.
• CMP might think about an advancement program through the growth towards foreign markets in order to decrease its dependence over Chinese markets by utilizing its huge financial resources.
Hazards
The altering macro patterns in the market and increasing competition in the publishing market has actually presented specific hazards to Magna International Inc B Case Study Analysis including;( Gurel, 2017).
• Intro of digital publishing i.e. virtual libraries might cause decreasing market share of Magna International Inc B Case Study Analysis due to the consumer shift towards digital libraries.
• The existence of large number of rivals in the publishing industry increase the threat for CMP to lose its competitive position in the market, as rivals can acquire a strong consumer base by utilizing particular methods like aggressive promotion, quality products, etc.
• Entrance of brand-new publishing companies in the industry along with presence of high competitors increases the danger of losing the consumer base.
Monetary Analysis.
The company has a quite competitive monetary performance. Due to absence of data, the financial ratios of CMP might not be computed. However, the total monetary efficiency of the business might be examined by using the charts given in the case Appendices. It could be examined from the Appendix III that the annual overall incomes of CMP during the duration 2000-2012 are growing at a high growth rate, revealing that the annual need of the items of Magna International Inc B Case Study Analysis is growing and the company is quite effective in attracting a a great deal of consumers at a prospective rate.
Along with it, the 2nd graph which shows the annual growth in the Magna International Inc B Case Study Analysis overall properties, shows that the business is rather effective in adding value to its assets through its revenues. The development in assets shows that the total value of the company is likewise increasing with increasing the overall revenues. (Unknown, 2013).
Another monetary analysis of the business utilizing the given data could be the analysis relating to the circulation of overall revenues of the company. Huge part of the revenues of CMP originates from the sales of its published books i.e. 64% as displayed in the Case Appendix V. The business could move towards other organisation segments with a prospective development to accomplish its future advancement objective.
PESTEL Analysis
PESTEL analysis could be carried out to discover the numerous external forces affecting the efficiency of the company and the recent patterns in the external environment of the business. A short PESTEL analysis of the business is offered 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 extremely supervised and guided by the Publicity Department of the Communist Party of China. It could be said that the total political forces affecting CMP business 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 basic and the Magna International Inc B Case Study Analysis in specific includesthe costs of paper, the income level of consumers, the inflation rate, and the general GDP development of the country. All these forces combine effect the demand for the publishing market. Along with it, the financial policies related to the import of books affect the overall organisation at CPM. China's economic conditions are quite beneficial for CMP with high GDP development and customer income level.
Social and Demographical.
The consumer choices are moving towards digital publishing rather than the traditional was of publishing. In this regard, CMP needs to focus on digital publishing to satisfy the altering customer choices.
Technological.
Technological forces affecting the CMP include the technological development in the reading methods etc. Improvement of science and innovation along with the rise of digital publishing could reduce the need for the CMP products, if particular actions would not be taken quickly.
Environmental.
Environmental forces affecting Magna International Inc B Case Study Solution includes the issues of ecological neighborhoods over the usage of paper in publishing books. The paper used in the books while publishing is required to be disposable and the ink used while publishing must not be damaging for the environment.
Legal.
Legal regulations for the publishing sector at whole are high. Publishing Ordinance 1997 requires the publishers to be authorized initially 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 utilized to analyze the appearance of the publishing market China. A quick analysis of the Porter's 5 Forces is offered as follows;.
Danger of New Entrants.
Hazards of new entrants in the Chinese Publishing Market is moderate. The prospective development in the market tends to bring in brand-new entrants to the publishing market. The existence of extreme competition and the requirement of big capital tends to demotivate new entrants to go into in the market.
Danger of Alternative.
Threat of Alternative is high for the Chinese Publishing Market. The substitute items for the published files is the documents provided in the digital libraries on certain sites. The changing customer choices towards digital knowing increase the risk of substitution for the market.
Competitive Rivalry.
Competitive rivalry in the publishing industry is high. The existence of a great deal of customers in the Chinese Publishing Market like CIP, PTP etc. tends to produce high competitive rivalry for CMP. In addition to it, new entrants are also entering into the market increasing the competition for CMP.
Bargaining Power of Supplier.
The major providers of the Magna International Inc B Case Study Analysis consist of the providers of the paper for releasing documents. As CMP is the largest publisher in the Chinese Publishing Market, therefore the overall bargaining power of provider for CMP is low.
Bargaining Power of Purchaser.
Haggling 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 marketplace saturation, the buyers needs high quality files at competitive prices.
Rivals Analysis.
CMP runs in a highly competitive industry with the existence of large number of competitors. The company has a competitive position in the market with the greatest market share in the Chinese publishing market. Major competitors of Magna International Inc B Case Study Help include;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIPis among the close rivals of CMP. Established in the same period, CIP publishes similar type of books. For a big time period, CIP held the biggest market share, and still ranks third and 2nd in numerous market sectors, with a significant focus on educational publications. CIP acts as a threat for CMP as it could wean its market share due to its long term competitive background. CIP is concentrated on digital publishing and might wean the marketplace share of Magna International Inc B Case Study Analysis easily in the present market situation.
Posts and telecommunication Press (PTP).
It was likewise established in the exact same duration as Magna International Inc B Case Study Help and CIP. It is likewise one of the popular players in the publishing industry with an annual total revenues of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Decreasing reliance over the Chinese markets.
• Increasing number of Customers
• Growth chances.
• Avoiding the effect of market saturation in the Chinese publishing industry.
Cons
• Use of potential resources in growth.
• Danger of failure in new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining consumer base.
• Approaching new markets.
• Easy to introduce utilizing present capabilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased product portfolio offers 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 sectors to the brand-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 company in addition to the industry analysis and the rival analysis, Alternative 2 is suggested to CMP to attain its future development. As the preferences are moving towards digital publishing and the business require an instant service to avoid the declining market growth. Introduction of digital publishing might prove to be an immediate option with low amount of risk for the company. The company could likewise consider the expansion program after the success of its digital publishing program.
Execution
In order to introduce digital publishing in its product portfolio, the business should first gathers the data related to the customer demand, the possible markets, the federal government guidelines and the information related to the rivals presented in the market. If the preliminary offering shows a success, the business should go for the other markets. In this way the business would be able to implement its digital publishing program.
Conclusion
Although, the development of the publishing market is decreasing because 2008, showing a hazard to the company's long term presence, but the situation can be managed by thinking about a development strategy in the future. The business might consider presenting digital publishingin its existing market to execute its development program at instant basis and to avoid the risk of failure for entrance in the new markets.
