Milliway Capital Martin Smith November 2008 Case Study Solution and Analysis
Intro
Milliway Capital Martin Smith November 2008 Case Study Analysis is the largest publishing company with a greatest market share in the China's book retail market. CMP has actually become a specialized information service provider and a large extensive Science and Innovation publishing company through the combination of print media, audio-visual media and the network media.
Crucial Problems
Although, Milliway Capital Martin Smith November 2008 Case Study Analysis has spent its 60 years journey smoothly, being a successful publishing home, however, the changing macro market trends and forces bring particular challenges to the publishing market in basic and CMP in particular. These elements consist of;
• Entryway of the new publishing companies in the market.
• Decreasing development of the publishing market.
• Market saturation.
• Introduction of digital publishing techniques
• Enhancement of science and technology.
The change of the macro markets have raised a number of questions 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 capabilities of the company could be utilized to pursue the future development unceasingly? How could the business sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Milliway Capital Martin Smith November 2008 Case Study Solution has certain strengths that can be used to reduce the risks, conquer the weakness and avail the opportunities. Strengths of CMP are given as follows;
• The long term experience of Milliway Capital Martin Smith November 2008 Case Study Help in the publishing industry i.e. 60 years allows the business to offer high quality products at a lower expense using its previous experiences.
• The technical resources and capabilities generated by its successful journey offer a competitive advantage to CMP.
• Vast item portfolioof CMP helps it to diversify its threat and offer high value to its customers.
• Strong financial position enables the business to consider numerous advancement opportunities without any worry of raising fund externally.
Weak points
Together with the strengths, the company has specific weak points which might increase restrictions for the business in implementing its advancement program. The weak points of Milliway Capital Martin Smith November 2008 Case Study Analysis are offered as follows;
• Despite of being a science and innovation publishing firm, the company still has standard methods ofpublishing which are not suitable with the growing technological shift.
• CMP extremely relies over the Chinese markets for its growth. It should propose particular growth strategies to avoid its dependence over the Chinese markets to attain long term development.
Opportunities
Although, the growth of the publishing market is declining considering that 2008, affecting Milliway Capital Martin Smith November 2008 Case Study Analysis as well, however the growth might be revived by availing certain chances provided in the market. The marketplace opportunities for CMP include;
• The business could also introduce Digital Publishing by utilizing its long term technical experience and a strong consumer recognition in the market.
• CMP might consider a development program through the expansion towards foreign markets in order to lower its dependence over Chinese markets by utilizing its huge financial resources.
Dangers
The changing macro patterns in the market and increasing competition in the publishing market has positioned specific hazards to Milliway Capital Martin Smith November 2008 Case Study Solution consisting of;( Gurel, 2017).
• Intro of digital publishing i.e. virtual libraries could result in declining market share of Milliway Capital Martin Smith November 2008 Case Study Analysis due to the customer shift towards virtual libraries.
• The presence of large number of competitors in the publishing industry increase the threat for CMP to lose its competitive position in the market, as competitors can get a strong customer base by utilizing certain strategies like aggressive promotion, quality products, etc.
• Entryway of new publishing firms in the market in addition to presence of high competitors increases the hazard of losing the customer base.
Financial Analysis.
Due to lack of information, the monetary ratios of CMP might not be computed. It could be analyzed from the Appendix III that the annual total incomes of Milliway Capital Martin Smith November 2008 Case Study Analysis during the period 2000-2012 are growing at a high growth rate, showing that the annual need of the items of CMP is growing and the company is rather effective in bring in a large number of consumers at a possible price.
In addition to it, the 2nd chart which shows the yearly growth in the Milliway Capital Martin Smith November 2008 Case Study Solution overall possessions, reveals that the company is rather effective in including value to its properties through its incomes. The growth in assets shows that the overall value of the firm is also increasing with increasing the overall profits. (Unidentified, 2013).
Another monetary analysis of the company utilizing the offered information might be the analysis regarding the distribution of overall revenues of the business. Major part of the incomes 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 business sectors with a potential development to achieve its future development goal.
PESTEL Analysis
PESTEL analysis might be conducted to learn the numerous external forces affecting the efficiency of the company and the recent trends in the external environment of the business. A short PESTEL analysis of the company is provided as follows; (Alanzi, 2018).
Political.
As the publishing sector could have a substantial effect on the mindset of the people about the communist ideology of the government, for that reason, the publishing sector is highly supervised and guided by the Publicity Department of the Communist Celebration of China. For that reason, it might be said that the general political forces impacting Milliway Capital Martin Smith November 2008 Case Study Analysis service are high. The federal government policies concerning the publishing sector are likewise increasing with the passage of time.
Economical.
Financial forces impacting the publishing sector in general and the CMP in specific includesthe costs of paper, the earnings level of consumers, the inflation rate, and the overall GDP development of the country. All these forces combine effect the need for the publishing market.
Social and Demographical.
The consumer choices are shifting towards digital publishing rather than the standard was of publishing. In this regard, CMP ought to focus on digital publishing to satisfy the altering consumer choices.
Technological.
Technological forces affecting the CMP include the technological development in the reading techniques etc. Improvement of science and technology together with the rise of digital publishing could lower the demand for the CMP items, if particular actions would not be taken quickly.
Environmental.
Ecological forces affecting Milliway Capital Martin Smith November 2008 Case Study Analysis includes the issues of environmental neighborhoods over the use of paper in publishing books. The paper used in the books while publishing is required to be non reusable and the ink used while publishing needs to not be harmful for the environment.
Legal.
Legal regulations for the publishing sector at whole are high. Publishing Ordinance 1997 needs the publishers to be approved initially by the Government to be gone into in the publishing market.
Market Analysis (Porter's Five Forces Design).
Porter's Five Forces Model might be utilized to evaluate the beauty of the publishing market China. A quick analysis of the Porter's 5 Forces is provided as follows;.
Threat of New Entrants.
Hazards of brand-new entrants in the Chinese Publishing Industry is moderate. The potential growth in the market tends to draw in brand-new entrants to the publishing industry. The existence of extreme competition and the requirement of big capital tends to demotivate new entrants to enter in the market.
Risk of Replacement.
Danger of Alternative is high for the Chinese Publishing Market. The alternative items for the released documents is the documents provided in the virtual libraries on certain sites. The altering consumer preferences towards digital learning increase the hazard of alternative for the market.
Competitive Rivalry.
Competitive competition 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. Along with it, brand-new entrants are also participating in the market increasing the competitors for CMP.
Bargaining Power of Supplier.
The significant suppliers of the Milliway Capital Martin Smith November 2008 Case Study Analysis consist of the suppliers of the paper for publishing documents. As CMP is the biggest publisher in the Chinese Publishing Market, for that reason the overall bargaining power of supplier for CMP is low.
Bargaining Power of Purchaser.
Haggling 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 market saturation, the buyers requires high quality files at competitive prices.
Rivals Analysis.
CMP runs in a highly competitive market with the existence of a great deal of rivals. However, the company has a competitive position in the market with the highest market share in the Chinese publishing market. Major competitors of Milliway Capital Martin Smith November 2008 Case Study Help include;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIPis among the close rivals of CMP. Founded in the very same duration, CIP publishes comparable type of books. For a large time period, CIP held the largest market share, and still ranks second and third in numerous market sectors, with a significant concentrate on educational publications. CIP functions as a danger 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 market share of Milliway Capital Martin Smith November 2008 Case Study Solution quickly in the existing market circumstance.
Posts and telecommunication Press (PTP).
It was likewise established in the exact same duration as Milliway Capital Martin Smith November 2008 Case Study Solution and CIP. It is likewise one of the prominent players in the publishing industry with a yearly total profits of RMB 550 million in 2010.
Alternatives
Alternative-1: Expand towards New Markets
Pros
• Lowering dependence over the Chinese markets.
• Increasing variety of Customers
• Development chances.
• Avoiding the impact of market saturation in the Chinese publishing market.
Cons
• Usage of possible resources in expansion.
• Risk of failure in new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
Pros
• Sustaining consumer base.
• Approaching new markets.
• Easy to present using present abilities.
• 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 segments to the new one can lead the business to lose demand of its products in the market.
Recommendations
With the deep analysis of the internal and external environment of the business along with the industry analysis and the rival analysis, Alternative 2 is suggested to CMP to attain its future development. As the preferences are shifting towards digital publishing and the company require an immediate solution to prevent the declining industry development. Introduction of digital publishing might prove to be an immediate service with low amount of risk for the business. Nevertheless, the company could likewise think about the growth program after the success of its digital publishing program.
Application
In order to present digital publishing in its product portfolio, the company must first gathers the information related to the customer need, the possible markets, the federal government guidelines and the data associated with the competitors presented in the market. After that, the business must decide one potential sector for its initial offering. It ought to gather research that how it could differentiate its digital publishing from the existing rivals' items. The actions above the business need to go for the initial offering. The company should go for the other markets if the preliminary offering proves a success. In this way the business would be able to execute its digital publishing program.
Conclusion
Although, the development of the publishing market is decreasing given that 2008, revealing a risk to the business's long term existence, but the circumstance can be controlled by thinking about an advancement strategy in the future. The business might think about presenting digital publishingin its existing market to execute its advancement program at instant basis and to prevent the risk of failure for entryway in the new markets.
