Oriflame Sa A Case Study Solution and Analysis
Oriflame Sa A Case Study Analysis is the largest publishing company with a greatest market share in the China's book retail market. CMP has ended up being a specialized info company and a large comprehensive Science and Innovation publishing company through the integration of print media, audio-visual media and the network media.
CMP has actually invested its 60 years journey smoothly, being a successful publishing home, nevertheless, the altering macro market patterns and forces bring particular difficulties to the publishing market in general and Oriflame Sa A Case Study Help in specific. These aspects include;
• Entryway of the new publishing companies in the industry.
• Decreasing development of the publishing market.
• Market saturation.
• Introduction of digital publishing techniques
• Enhancement of science and technology.
The improvement 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 valuable experience, technical resources and the abilities of the company could be utilized to strive for the future development unceasingly? How could the business sustain its long term competitive position in future?
Oriflame Sa A Case Study Solution has particular strengths that can be made use of to decrease the threats, overcome the weak point and get the chances. Strengths of CMP are provided as follows;
• The long term experience of Oriflame Sa A Case Study Help in the publishing market i.e. 60 years permits the business to provide high quality items at a lower cost utilizing its previous experiences.
• The technical resources and capabilities produced by its effective journey offer a competitive advantage to CMP.
• Vast product portfolioof CMP assists it to diversify its threat and provide high worth to its customers.
• Strong monetary position enables the company to consider numerous advancement opportunities without any worry of raising fund externally.
Along with the strengths, the business has particular weak points which might increase restrictions for the business in executing its development program. The weaknesses of Oriflame Sa A Case Study Analysis are given as follows;
• Despite of being a science and technology publishing company, 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 needs to propose specific growth plans to prevent its reliance over the Chinese markets to attain long term growth.
The growth of the publishing industry is declining given that 2008, affecting Oriflame Sa A Case Study Analysis as well, however the growth could be restored by availing particular opportunities provided in the market. The marketplace chances for CMP consist of;
• The company might also present Digital Publishing by using its long term technical experience and a strong customer acknowledgment in the market.
• CMP might consider a development program through the growth towards foreign markets in order to reduce its reliance over Chinese markets by utilizing its huge financial resources.
The changing macro trends in the market and increasing competitors in the publishing market has presented particular threats to Oriflame Sa A Case Study Help including;( Gurel, 2017).
• Introduction of digital publishing i.e. virtual libraries could result in decreasing market share of Oriflame Sa A Case Study Solution due to the customer shift towards virtual libraries.
• The presence of a great deal of rivals in the publishing market increase the risk for CMP to lose its competitive position in the market, as competitors can gain a strong consumer base by utilizing certain strategies like aggressive promotion, quality products, etc.
• Entryway of new publishing companies in the industry together with presence of high competitors increases the danger of losing the customer base.
Due to lack of data, the monetary ratios of CMP could not be determined. It could be examined from the Appendix III that the annual overall profits of Oriflame Sa A Case Study Analysis during the duration 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 quite effective in attracting a large number of clients at a potential cost.
In addition to it, the 2nd graph which shows the yearly growth in the Oriflame Sa A Case Study Solution total assets, reveals that the company is rather efficient in including worth to its assets through its earnings. The development in assets shows that the overall value of the firm is also increasing with increasing the overall revenues. (Unknown, 2013).
Another monetary analysis of the business using the provided information might be the analysis regarding the circulation of overall earnings of the business. Major 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 company might move towards other service sections with a possible development to attain its future development objective.
PESTEL analysis could be conducted to discover the numerous external forces impacting the efficiency of the company and the recent patterns in the external environment of the company. A brief PESTEL analysis of the business is provided as follows; (Alanzi, 2018).
As the publishing sector might have a substantial impact on the frame of mind of individuals about the communist ideology of the government, therefore, the publishing sector is extremely monitored and assisted by the Promotion Department of the Communist Party of China. For that reason, it might be stated that the general political forces impacting Oriflame Sa A Case Study Analysis business are high. The government policies relating to the publishing sector are also increasing with the passage of time.
Financial forces affecting the publishing sector in general and the Oriflame Sa A Case Study Help in particular includesthe prices of paper, the earnings level of customers, the inflation rate, and the general GDP growth of the nation. All these forces combine impact the need for the publishing market. In addition to it, the economic policies associated with the import of books affect the total company at CPM. Nevertheless, China's financial conditions are rather beneficial for CMP with high GDP development and customer income level.
Social and Demographical.
Social and demographical forces consist of the population growth, the customer's preferences towards checking out helpful products and so on. China has the greatest population in the world with a high population development, showing the increasing number of customers of the Oriflame Sa A Case Study Solution. The customer choices are shifting towards digital publishing rather than the traditional was of publishing. In this regard, CMP should focus on digital publishing to satisfy the altering customer choices.
Technological forces affecting the CMP include the technological advancement in the reading methods etc. Enhancement of science and technology along with the increase of digital publishing might minimize the demand for the CMP products, if certain actions would not be taken quickly.
Ecological forces affecting Oriflame Sa A Case Study Help includes the issues of ecological communities over the use of paper in publishing books. The paper used in the books while publishing is needed to be disposable and the ink utilized while publishing needs to not be damaging for the environment.
Legal regulations for the publishing sector at whole are high. The legal policies concerning the publishing sector is controlled by the General Administration of Press and Publication. Publishing Ordinance 1997 needs the publishers to be authorized initially by the Government to be entered in the publishing market. The regulation forbids direct involvement of foreign entities and people in the publishing sector.
Industry Analysis (Porter's 5 Forces Design).
Porter's 5 Forces Design could be used to evaluate the appearance of the publishing market China. A short analysis of the Porter's Five Forces is offered as follows;.
Threat of New Entrants.
Threats of brand-new entrants in the Chinese Publishing Industry is moderate. The potential growth in the industry tends to attract brand-new entrants to the publishing industry. The existence of extreme competition and the requirement of substantial capital tends to demotivate new entrants to enter in the market.
Danger of Alternative.
Threat of Substitution is high for the Chinese Publishing Industry. The substitute products for the published documents is the documents presented in the digital libraries on specific websites. The altering customer preferences towards digital learning increase the danger of alternative for the market.
Competitive competition in the publishing market is high. The existence of large number of consumers 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 entering into the market increasing the competitors for CMP.
Bargaining Power of Supplier.
The significant suppliers of the Oriflame Sa A Case Study Analysis consist of the suppliers of the paper for publishing documents. As CMP is the biggest publisher in the Chinese Publishing Market, therefore the overall bargaining power of supplier for CMP is low.
Bargaining Power of Purchaser.
Negotiating power of buyer in the publishing industry is high. Due to the presence of a a great deal of publishers in the Chinese market and the marketplace saturation, the purchasers requires high quality files at competitive costs.
CMP operates in an extremely competitive market with the existence of large number of rivals. The company has a competitive position in the market with the greatest market share in the Chinese publishing market. Significant rivals of Oriflame Sa A Case Study Solution consist of;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIPis one of the close competitors of CMP. Established in the very same period, CIP releases similar kind of books. For a big period, CIP held the largest market share, and still ranks 2nd and 3rd in numerous market segments, with a significant focus on academic publications. CIP acts as a threat for CMP as it might wean its market share due to its long term competitive background. CIP is focused on digital publishing and might wean the marketplace share of Oriflame Sa A Case Study Help quickly in the present market scenario.
Posts and telecommunication Press (PTP).
It was likewise established in the very same duration as Oriflame Sa A Case Study Solution and CIP. It is likewise one of the popular players in the publishing market with an annual total profits of RMB 550 million in 2010.
Alternative-1: Broaden towards New Markets
• Minimizing dependence over the Chinese markets.
• Increasing variety of Clients
• Development chances.
• Preventing the impact of market saturation in the Chinese publishing industry.
• Usage of possible resources in growth.
• Danger of failure in new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
• Sustaining consumer base.
• Approaching brand-new markets.
• Easy to present using current abilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased item portfolio supplies high value to clients.
• Competition in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core organisation sections to the new one can lead the company to lose demand of its items in the market.
As the preferences are shifting towards digital publishing and the business require an instant solution to prevent the declining market growth. The business might likewise consider the expansion program after the success of its digital publishing program.
In order to introduce digital publishing in its product portfolio, the company ought to first gathers the data related to the consumer need, the prospective markets, the federal government policies and the data related to the competitors presented in the market. If the preliminary offering shows a success, the company ought to go for the other markets. In this way the business would be able to implement its digital publishing program.
Although, the growth of the publishing market is declining given that 2008, showing a threat to the business's long term presence, but the circumstance can be controlled 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.