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Mergers And Acquisitions Of Small And Medium Sized Enterprises Case Analysis

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Mergers And Acquisitions Of Small And Medium Sized Enterprises Case Study Solution and Analysis


Intro

Mergers And Acquisitions Of Small And Medium Sized Enterprises Case Study Solution is the largest publishing company with a highest market share in the China's book retail market. CMP has ended up being a specialized information supplier and a large detailed Science and Innovation publishing company through the integration of print media, audio-visual media and the network media.

Vital Issues

CMP has actually spent its 60 years journey efficiently, being an effective publishing home, however, the altering macro market trends and forces bring particular difficulties to the publishing market in basic and Mergers And Acquisitions Of Small And Medium Sized Enterprises Case Study Analysis in particular. These elements consist of;

• Entryway of the brand-new publishing companies in the industry.
• Declining growth of the publishing market.
• Market saturation.
• Introduction of digital publishing strategies
• Enhancement of science and technology.
Executive Summary
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 scenario? Do the long important experience, technical resources and the capabilities of the company could be made use of 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


Mergers And Acquisitions Of Small And Medium Sized Enterprises Case Study Help has particular strengths that can be used to minimize the risks, overcome the weakness and get the opportunities. Strengths of CMP are offered as follows;

• The long term experience of Mergers And Acquisitions Of Small And Medium Sized Enterprises Case Study Help in the publishing market i.e. 60 years allows the business to offer high quality products at a lower cost utilizing its previous experiences.
• The technical resources and capabilities generated by its effective journey offer a competitive advantage to CMP.
• Huge item portfolioof CMP helps it to diversify its danger and provide high value to its consumers.
• Strong financial position allows the company to consider numerous advancement opportunities with no fear of raising fund externally.

Weaknesses

Together with the strengths, the business has specific weaknesses which might increase restrictions for the business in executing its advancement program. The weaknesses of Mergers And Acquisitions Of Small And Medium Sized Enterprises Case Study Analysis are given as follows;

• Despite of being a science and technology publishing firm, the company still has traditional methods ofpublishing which are not suitable with the growing technological shift.
• CMP highly relies over the Chinese markets for its growth. It needs to propose specific expansion plans to prevent its dependence over the Chinese markets to attain long term growth.
Porter's 5 Forces Analysis
Opportunities

Although, the development of the publishing market is decreasing since 2008, impacting Mergers And Acquisitions Of Small And Medium Sized Enterprises Case Study Solution also, however the development could be revived by availing particular chances presented in the market. The market chances for CMP include;

• The business could also introduce Digital Publishing by using its long term technical experience and a strong consumer recognition in the market.
• CMP might consider a development program through the growth towards foreign markets in order to lower its dependence over Chinese markets by utilizing its huge financial resources.

Dangers

The altering macro patterns in the market and increasing competitors in the publishing market has postured particular dangers to Mergers And Acquisitions Of Small And Medium Sized Enterprises Case Study Analysis consisting of;( Gurel, 2017).

• Introduction of digital publishing i.e. digital libraries could lead to decreasing market share of Mergers And Acquisitions Of Small And Medium Sized Enterprises Case Study Analysis due to the customer shift towards digital libraries.
• The existence of large number of competitors 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 promo, quality items, and so on
• Entryway of brand-new publishing firms in the market together with existence of high competition increases the risk of losing the consumer base.

Monetary Analysis.
Swot Analysis
Due to lack of data, the financial ratios of CMP could not be calculated. It could be examined from the Appendix III that the yearly total revenues of Mergers And Acquisitions Of Small And Medium Sized Enterprises Case Study Analysis throughout the period 2000-2012 are growing at a high growth rate, revealing that the yearly need of the items of CMP is growing and the business is quite effective in bring in a large number of customers at a possible price.

In addition to it, the second chart which reveals the annual development in the Mergers And Acquisitions Of Small And Medium Sized Enterprises Case Study Solution overall possessions, shows that the company is rather efficient in including value to its properties through its incomes. The development in assets shows that the total value of the company is also increasing with increasing the total incomes. (Unidentified, 2013).

Another monetary analysis of the business utilizing the given data might be the analysis concerning the distribution of total profits of the company. Major part of the profits of CMP originates from the sales of its published books i.e. 64% as displayed in the Case Appendix V. The company could move towards other business segments with a possible development to accomplish its future advancement objective.

PESTEL Analysis

PESTEL analysis might be performed to learn the different external forces impacting the performance of the business and the recent patterns in the external environment of the company. A short PESTEL analysis of the business is offered as follows; (Alanzi, 2018).

Political.

As the publishing sector could have a considerable impact on the mindset of the people about the communist ideology of the government, for that reason, the publishing sector is extremely supervised and directed by the Promotion Department of the Communist Party of China. It could be stated that the general political forces affecting CMP organisation are high. The government policies concerning the publishing sector are likewise increasing with the passage of time.

Cost-effective.

Financial forces impacting the publishing sector in basic and the Mergers And Acquisitions Of Small And Medium Sized Enterprises Case Study Solution in particular includesthe prices of paper, the earnings level of consumers, the inflation rate, and the overall GDP growth of the country. All these forces integrate effect the demand for the publishing market. Together with it, the economic policies related to the import of books impact the overall organisation at CPM. China's financial conditions are rather favorable for CMP with high GDP development and customer earnings level.

Social and Demographical.

The customer choices are shifting towards digital publishing rather than the standard was of publishing. In this regard, CMP needs to focus on digital publishing to fulfill the changing customer choices.

Technological.

Technological forces affecting the CMP consist of the technological development in the reading strategies etc. Improvement of science and technology in addition to the rise of digital publishing could reduce the demand for the CMP items, if certain actions would not be taken quickly.

Environmental.
Vrio Analysis
Ecological forces affecting Mergers And Acquisitions Of Small And Medium Sized Enterprises Case Study Solution includes the issues of ecological communities over the usage of paper in publishing books. The paper used in the books while publishing is needed 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 Government to be gone into in the publishing market.

Market Analysis (Porter's Five Forces Design).

Porter's Five Forces Design could be utilized to evaluate the attractiveness of the publishing industry China. A brief analysis of the Porter's 5 Forces is offered as follows;.

Threat of New Entrants.

Hazards of brand-new entrants in the Chinese Publishing Market is moderate. The potential growth in the industry tends to attract new entrants to the publishing industry. However, the presence of intense competition and the requirement of big capital tends to demotivate new entrants to go into in the marketplace.

Risk 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 consumer preferences towards digital knowing increase the danger of substitution for the industry.

Competitive Rivalry.

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 competition for CMP. In addition to it, brand-new entrants are likewise participating in the marketplace increasing the competitors for CMP.

Bargaining Power of Provider.

The significant providers of the Mergers And Acquisitions Of Small And Medium Sized Enterprises Case Study Solution consist of the providers of the paper for releasing documents. As CMP is the largest publisher in the Chinese Publishing Market, for that reason the general bargaining power of provider for CMP is low.

Bargaining Power of Purchaser.

Negotiating power of buyer 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 requires high quality files at competitive prices.

Rivals Analysis.

CMP runs in a highly competitive industry with the existence of a great deal of competitors. However, the business has a competitive position in the market with the greatest market share in the Chinese publishing market. Major rivals of Mergers And Acquisitions Of Small And Medium Sized Enterprises Case Study Analysis consist of;.

• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).

Chemical Industry Press (CIP).

CIP acts as a danger for CMP as it might wean its market share due to its long term competitive background. CIP is focused on digital publishing and could wean the market share of CMP quickly in the current market scenario.

Posts and telecommunication Press (PTP).

It was also founded in the same duration as Mergers And Acquisitions Of Small And Medium Sized Enterprises Case Study Analysis and CIP. It is also one of the popular gamers in the publishing market with a yearly overall revenues of RMB 550 million in 2010.

Alternatives

Alternative-1: Expand towards New Markets

Pros

• Reducing reliance over the Chinese markets.
• Increasing variety of Customers
• Development chances.
• Avoiding the impact of market saturation in the Chinese publishing market.

Cons
Recommendations
• Usage of possible resources in growth.
• Threat of failure in brand-new markets.
• Time consuming.

Alernative-2: Present Digital Publishing

Pros

• Sustaining customer base.
• Approaching brand-new markets.
• Easy to introduce utilizing current capabilities.
• Low risk of Failure.
• Low requirement for funds.
• Increased item portfolio supplies 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 company segments to the brand-new one can lead the business to lose demand of its products in the market.

Suggestions

As the choices are moving towards digital publishing and the company need an immediate solution to avoid the declining market growth. The business might 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 data associated with the consumer need, the potential markets, the federal government policies and the information connected to the rivals provided in the market. After that, the business should choose one possible sector for its preliminary offering. It must gather research that how it could separate its digital publishing from the existing rivals' products. After all the steps above the company need to opt for the initial offering. The company must go for the other markets if the preliminary offering proves a success. In this method the company would be able to execute its digital publishing program.

Conclusion

Although, the growth of the publishing industry is decreasing because 2008, showing a risk to the company's long term existence, but the scenario can be managed by thinking about a development strategy in the future. The business might consider introducing digital publishingin its existing market to implement its development program at instant basis and to avoid the threat of failure for entryway in the new markets.

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