Mahgan Logistics Inc Case Study Solution and Analysis
Introduction
Mahgan Logistics Inc Case Study Solution is the biggest publishing company with a highest market share in the China's book retail market. CMP has actually ended up being a specialized details service provider and a big extensive Science and Innovation publishing business through the combination of print media, audio-visual media and the network media.
Vital Concerns
CMP has spent its 60 years journey smoothly, being a successful publishing house, nevertheless, the changing macro market trends and forces bring specific challenges to the publishing industry in basic and Mahgan Logistics Inc Case Study Solution in specific. These elements include;
• Entrance of the new publishing firms in the industry.
• Decreasing development of the publishing market.
• Market saturation.
• Introduction of digital publishing strategies
• Improvement of science and technology.
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 important experience, technical resources and the capabilities of the company 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
Mahgan Logistics Inc Case Study Help has specific strengths that can be used to lower the dangers, get rid of the weakness and avail the opportunities. Strengths of CMP are given as follows;
• The long term experience of Mahgan Logistics Inc Case Study Solution in the publishing market i.e. 60 years allows the business to supply high quality products at a lower expense using its prior experiences.
• The technical resources and abilities generated by its effective journey offer a competitive benefit to CMP.
• Huge product portfolioof CMP assists it to diversify its risk and supply high worth to its customers.
• Strong financial position enables the company to think about a number of development opportunities without any fear of raising fund externally.
Weaknesses
Together with the strengths, the business has specific weaknesses which could increase restraints for the business in implementing its advancement program. The weaknesses of Mahgan Logistics Inc Case Study Analysis are provided as follows;
• Despite of being a science and technology publishing company, the business still has traditional 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 specific expansion plans to prevent its dependence over the Chinese markets to achieve long term growth.
Opportunities
Although, the development of the publishing industry is decreasing because 2008, affecting Mahgan Logistics Inc Case Study Solution also, however the development could be revived by availing certain opportunities presented in the market. The marketplace opportunities for CMP consist of;
• The business could likewise present Digital Publishing by utilizing its long term technical experience and a strong consumer recognition in the market.
• CMP might think about an advancement program through the growth towards foreign markets in order to minimize its dependence over Chinese markets by utilizing its vast funds.
Risks
The changing macro trends in the market and increasing competitors in the publishing industry has presented particular hazards to Mahgan Logistics Inc Case Study Help including;( Gurel, 2017).
• Introduction of digital publishing i.e. digital libraries could cause declining market share of Mahgan Logistics Inc Case Study Analysis due to the consumer shift towards digital libraries.
• The presence of a great deal of competitors in the publishing industry increase the danger for CMP to lose its competitive position in the market, as rivals can gain a strong consumer base by utilizing particular strategies like aggressive promotion, quality items, etc.
• Entryway of new publishing companies in the market in addition to presence of high competitors increases the risk of losing the customer base.
Financial Analysis.
The business has a rather competitive monetary efficiency. Due to absence of information, the monetary ratios of CMP could not be determined. Nevertheless, the total financial efficiency of the company could be analyzed by using the graphs given in the case Appendices. It might be evaluated from the Appendix III that the yearly overall earnings of CMP throughout the duration 2000-2012 are growing at a high growth rate, revealing that the annual demand of the products of Mahgan Logistics Inc Case Study Help is growing and the business is rather effective in bring in a large number of clients at a possible rate.
Together with it, the second graph which reveals the annual growth in the Mahgan Logistics Inc Case Study Help total properties, reveals that the company is rather efficient in adding value to its properties through its revenues. The growth in assets reveals that the overall worth of the firm is also increasing with increasing the total revenues. (Unidentified, 2013).
Another financial analysis of the company utilizing the offered information might be the analysis regarding the circulation of total revenues of the business. Huge part of the incomes 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 organisation segments with a possible development to accomplish its future development objective.
PESTEL Analysis
PESTEL analysis could be carried out to learn the different external forces impacting the performance of the company and the recent patterns in the external environment of the company. A short PESTEL analysis of the company is provided as follows; (Alanzi, 2018).
Political.
As the publishing sector could have a substantial impact on the frame of mind of individuals about the communist ideology of the government, therefore, the publishing sector is extremely supervised and assisted by the Publicity Department of the Communist Party of China. For that reason, it could be said that the overall political forces impacting Mahgan Logistics Inc Case Study Help service are high. The federal government policies regarding the publishing sector are also increasing with the passage of time.
Affordable.
Financial forces affecting the publishing sector in basic and the CMP in particular includesthe prices of paper, the earnings level of consumers, the inflation rate, and the total GDP growth of the country. All these forces integrate effect the need for the publishing market.
Social and Demographical.
The customer preferences are shifting 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 impacting the CMP consist of the technological development in the reading methods and so on. Enhancement of science and technology together with the rise of digital publishing could lower the demand for the CMP items, if certain actions would not be taken quickly.
Environmental.
Environmental forces impacting Mahgan Logistics Inc 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 non reusable and the ink utilized while publishing ought to not be damaging for the environment.
Legal.
Legal policies for the publishing sector at whole are high. The legal policies regarding the publishing sector is managed by the General Administration of Press and Publication. Publishing Ordinance 1997 needs the publishers to be approved initially by the Government to be entered in the publishing market. The ordinance forbids direct participation of foreign entities and individuals in the publishing sector.
Industry Analysis (Porter's Five Forces Model).
Porter's Five Forces Design might be used to examine the beauty of the publishing market China. A quick analysis of the Porter's Five Forces is offered as follows;.
Threat of New Entrants.
Dangers of brand-new entrants in the Chinese Publishing Market is moderate. The possible development in the industry tends to bring in brand-new entrants to the publishing industry. The existence of intense competition and the requirement of substantial capital tends to demotivate new entrants to enter in the market.
Hazard of Substitution.
Hazard of Substitution is high for the Chinese Publishing Market. The replacement products for the released files is the files presented in the virtual libraries on particular sites. The altering customer choices towards digital knowing increase the risk of replacement for the industry.
Competitive Competition.
Competitive competition in the publishing market is high. The presence of a great deal of customers in the Chinese Publishing Market like CIP, PTP and so on tends to produce high competitive rivalry for CMP. Together with it, brand-new entrants are also participating in the marketplace increasing the competition for CMP.
Bargaining Power of Supplier.
The significant providers of the Mahgan Logistics Inc Case Study Analysis include the suppliers of the paper for publishing documents. As CMP is the largest publisher in the Chinese Publishing Market, therefore the total bargaining power of provider for CMP is low.
Bargaining Power of Purchaser.
Haggling power of buyer in the publishing market is high. Due to the existence of a large number of publishers in the Chinese market and the marketplace saturation, the buyers requires high quality files at competitive costs.
Rivals Analysis.
CMP runs in an extremely competitive market with the presence of large number of rivals. However, the company has a competitive position in the market with the greatest market share in the Chinese publishing market. Significant competitors of Mahgan Logistics Inc Case Study Analysis include;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIPis one of the close rivals of CMP. Established in the exact same period, CIP releases similar type of books. For a large time period, CIP held the largest market share, and still ranks second and 3rd in different market sections, with a significant focus on educational publications. CIP functions as a hazard 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 marketplace share of Mahgan Logistics Inc Case Study Solution easily in the current market circumstance.
Posts and telecommunication Press (PTP).
Another close rival of CMP is PTP. It was likewise founded in the same period as CMP and CIP. It ranks sixth in the state-owned publishers in regards to business scale. It is also among the popular players in the publishing market with a yearly overall revenues of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Reducing dependence over the Chinese markets.
• Increasing number of Customers
• Development opportunities.
• Preventing the impact of market saturation in the Chinese publishing industry.
Cons
• Use of potential resources in expansion.
• Danger of failure in new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining customer base.
• Approaching new markets.
• Easy to introduce using existing abilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased product 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 new one can lead the business to lose demand of its products in the market.
Recommendations
As the choices are moving towards digital publishing and the business require an immediate solution to avoid the declining market development. The company could likewise consider the expansion program after the success of its digital publishing program.
Implementation
In order to introduce digital publishing in its product portfolio, the business needs to first gathers the information related to the consumer need, the possible markets, the federal government policies and the data related to the competitors provided in the market. If the initial offering proves a success, the company ought to go for the other markets. In this method the company would be able to implement its digital publishing program.
Conclusion
The development of the publishing industry is decreasing given that 2008, revealing a threat to the business's long term existence, however the scenario can be managed by thinking about an advancement plan in the future. The company could consider introducing digital publishingin its existing market to execute its advancement program at instant basis and to prevent the risk of failure for entryway in the brand-new markets.
