Magna International Inc B Case Study Solution and Analysis
Magna International Inc B Case Study Analysis is the biggest publishing company with a greatest market share in the China's book retail market. CMP provides a variety of services consisting of; collecting details, processing information and interaction services. Significant company sections of the business consist of; books, periodicals, consultancy and circulation. The business has a huge product portfolio and its significant items include books, periodicals, online media, exhibits, research study reports and so on. Magna International Inc B Case Study Analysis has become a specialized info supplier and a large detailed Science and Technology publishing business through the combination of print media, audio-visual media and the network media.
Although, Magna International Inc B Case Study Solution has invested its 60 years journey smoothly, being a successful publishing house, however, the changing macro market patterns and forces bring particular challenges to the publishing market in general and CMP in particular. These factors consist of;
• Entryway of the new publishing firms in the market.
• Decreasing development of the publishing market.
• Market saturation.
• Intro of digital publishing techniques
• Enhancement of science and innovation.
The improvement of the macro markets have raised numerous questions to the management at CPM that what could be the future of CMP in this circumstance? Do the long important experience, technical resources and the abilities of the company could be utilized to strive for the future development unceasingly? How could the company sustain its long term competitive position in future?
Magna International Inc B Case Study Analysis has specific strengths that can be made use of to reduce the dangers, overcome the weakness and obtain the opportunities. Strengths of CMP are offered as follows;
• The long term experience of Magna International Inc B Case Study Analysis in the publishing industry i.e. 60 years allows the business to offer high quality items at a lower expense using its previous experiences.
• The technical resources and capabilities created by its effective journey supply a competitive advantage to CMP.
• Huge product portfolioof CMP assists it to diversify its danger and offer high worth to its clients.
• Strong monetary position permits the business to think about a number of advancement chances without any worry of raising fund externally.
Together with the strengths, the company has certain weaknesses which might increase restraints for the business in executing its development program. The weak points of Magna International Inc B Case Study Help are provided as follows;
• Despite of being a science and technology publishing company, the company still has standard ways ofpublishing which are not compatible with the growing technological shift.
• CMP highly relies over the Chinese markets for its development. It ought to propose specific growth strategies to prevent its reliance over the Chinese markets to attain long term growth.
Although, the growth of the publishing market is decreasing because 2008, affecting Magna International Inc B Case Study Analysis as well, but the growth could be restored by availing specific opportunities presented in the market. The marketplace chances for CMP consist of;
• The business could also present 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 expansion towards foreign markets in order to decrease its dependence over Chinese markets by using its large funds.
The changing macro patterns in the market and increasing competition in the publishing industry has actually presented particular dangers to Magna International Inc B Case Study Help including;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries could lead to decreasing market share of Magna International Inc B Case Study Solution due to the consumer shift towards virtual libraries.
• The existence of a great deal of competitors in the publishing industry increase the danger for CMP to lose its competitive position in the market, as competitors can gain a strong consumer base by using certain strategies like aggressive promotion, quality items, and so on
• Entryway of brand-new publishing firms in the market in addition to presence of high competitors increases the threat of losing the client base.
Due to absence of data, the financial ratios of CMP might not be calculated. It could be examined from the Appendix III that the yearly overall incomes of Magna International Inc B Case Study Solution throughout the duration 2000-2012 are growing at a high growth rate, showing that the annual demand of the items of CMP is growing and the business is quite effective in attracting a large number of customers at a prospective cost.
Together with it, the second graph which shows the yearly growth in the Magna International Inc B Case Study Solution overall assets, shows that the business is rather effective in including worth to its properties through its earnings. The growth in assets shows that the overall value of the firm is likewise increasing with increasing the overall revenues. (Unidentified, 2013).
Another monetary analysis of the company using the provided data could be the analysis regarding the distribution of total incomes of the company. Huge part of the profits of CMP originates from the sales of its released books i.e. 64% as displayed in the Case Appendix V. The business could move towards other service segments with a prospective development to accomplish its future development goal.
PESTEL analysis might be conducted to find out the different external forces affecting the performance of the company and the current trends in the external environment of the company. A quick PESTEL analysis of the business is given as follows; (Alanzi, 2018).
As the publishing sector might have a substantial effect on the mindset of the people about the communist ideology of the government, therefore, the publishing sector is highly monitored and guided by the Promotion Department of the Communist Celebration of China. Therefore, it could be stated that the overall political forces impacting Magna International Inc B Case Study Analysis business are high. The government policies concerning the publishing sector are also increasing with the passage of time.
Economic forces impacting the publishing sector in general and the CMP in particular includesthe prices of paper, the income level of consumers, the inflation rate, and the total GDP growth of the nation. All these forces combine impact the need for the publishing market.
Social and Demographical.
Social and demographical forces consist of the population growth, the consumer's preferences towards checking out useful materials etc. China has the greatest population on the planet with a high population development, revealing the increasing variety of customers of the Magna International Inc B Case Study Help. 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 changing customer choices.
Technological forces impacting the CMP consist of the technological advancement in the reading techniques etc. Enhancement of science and innovation together with the rise of digital publishing could decrease the need for the CMP items, if particular actions would not be taken soon.
Environmental forces impacting Magna International Inc B Case Study Solution includes the concerns of ecological communities over the usage of paper in publishing books. The paper utilized in the books while publishing is required to be non reusable and the ink utilized while publishing needs to not be harmful for the environment.
Legal policies for the publishing sector at whole are high. The legal guidelines regarding the publishing sector is managed by the General Administration of Press and Publication. Publishing Regulation 1997 requires the publishers to be authorized initially by the Government to be entered in the publishing market. The regulation prohibits direct involvement of foreign entities and individuals in the publishing sector.
Industry Analysis (Porter's 5 Forces Model).
Porter's 5 Forces Design might be utilized to analyze the appearance of the publishing market China. A quick analysis of the Porter's Five Forces is offered as follows;.
Risk of New Entrants.
Hazards of new entrants in the Chinese Publishing Industry is moderate. The possible development in the market tends to draw in brand-new entrants to the publishing market. The existence of intense competition and the requirement of substantial capital tends to demotivate brand-new entrants to go into in the market.
Danger of Alternative.
Danger of Substitution is high for the Chinese Publishing Industry. The replacement items for the released files is the documents provided in the virtual libraries on particular websites. The altering customer choices towards digital knowing increase the risk of alternative for the market.
Competitive rivalry in the publishing industry is high. The existence of a great deal of consumers in the Chinese Publishing Market like CIP, PTP and so on tends to produce high competitive rivalry for CMP. Along with it, new entrants are also entering into the marketplace increasing the competitors for CMP.
Bargaining Power of Supplier.
The significant providers of the Magna International Inc B Case Study Help include the providers of the paper for releasing files. As CMP is the biggest publisher in the Chinese Publishing Market, therefore the general bargaining power of provider for CMP is low.
Bargaining Power of Purchaser.
Bargaining power of purchaser in the publishing industry is high. Due to the presence of a large number of publishers in the Chinese market and the marketplace saturation, the purchasers needs high quality files at competitive costs.
CMP operates in an extremely competitive industry with the presence of large number of competitors. However, the business has a competitive position in the market with the greatest market share in the Chinese publishing market. Significant rivals of Magna International Inc B Case Study Help consist of;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIP acts as a risk for CMP as it could 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 present market scenario.
Posts and telecommunication Press (PTP).
It was also founded in the very same duration as Magna International Inc B Case Study Help and CIP. It is also one of the prominent gamers in the publishing market with an annual overall earnings of RMB 550 million in 2010.
Alternative-1: Expand towards New Markets
• Reducing reliance over the Chinese markets.
• Increasing variety of Customers
• Development chances.
• Avoiding the effect of market saturation in the Chinese publishing industry.
• Usage of possible resources in growth.
• Threat of failure in new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
• Sustaining customer base.
• Approaching brand-new markets.
• Easy to introduce using existing capabilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased product portfolio supplies high value to clients.
• Competitors in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core service segments to the new one can lead the company to lose demand of its products in the market.
With the deep analysis of the external and internal environment of the company along with the market analysis and the competitor analysis, Alternative 2 is recommended to CMP to achieve its future development. As the choices are moving towards digital publishing and the business require an instant option to avoid the decreasing industry growth. Introduction of digital publishing could prove to be an instant service with low quantity of danger for the business. Nevertheless, the business might likewise think about the expansion program after the success of its digital publishing program.
In order to present digital publishing in its item portfolio, the company must first collects the information related to the customer demand, the potential markets, the federal government policies and the data connected to the rivals provided in the market. After that, the business ought to decide one potential sector for its preliminary offering. It needs to collect research that how it might differentiate its digital publishing from the existing rivals' items. The actions above the company must go for the preliminary offering. If the preliminary offering proves a success, the business must go for the other markets. In this way the company would be able to execute its digital publishing program.
The growth of the publishing market is decreasing since 2008, revealing a risk to the company's long term existence, but the situation can be managed by considering a development strategy in the future. The business might consider introducing digital publishingin its existing market to execute its advancement program at instant basis and to prevent the threat of failure for entrance in the new markets.