Paint Pen Inc 2 Case Study Solution and Analysis
Paint Pen Inc 2 Case Study Help is the biggest publishing business with a highest market share in the China's book retail market. CMP has actually ended up being a specialized information service provider and a large extensive Science and Innovation publishing business through the combination of print media, audio-visual media and the network media.
CMP has invested its 60 years journey efficiently, being a successful publishing home, however, the altering macro market trends and forces bring specific obstacles to the publishing market in general and Paint Pen Inc 2 Case Study Analysis in particular. These factors consist of;
• Entrance of the new publishing firms in the industry.
• Decreasing development of the publishing market.
• Market saturation.
• Introduction of digital publishing techniques
• Enhancement of science and innovation.
The change of the macro markets have raised numerous concerns to the management at CPM that what could be the future of CMP in this scenario? Do the long valuable experience, technical resources and the capabilities of the business could be made use of to strive for the future advancement unceasingly? How could the business sustain its long term competitive position in future?
Paint Pen Inc 2 Case Study Analysis has certain strengths that can be utilized to minimize the risks, get rid of the weak point and obtain the opportunities. Strengths of CMP are offered as follows;
• The long term experience of Paint Pen Inc 2 Case Study Help in the publishing industry i.e. 60 years allows the company to offer high quality items at a lower cost using its previous experiences.
• The technical resources and abilities produced by its effective journey supply a competitive advantage to CMP.
• Large item portfolioof CMP assists it to diversify its risk and supply high value to its customers.
• Strong monetary position enables the company to consider a number of development chances without any worry of raising fund externally.
In addition to the strengths, the business has specific weaknesses which could increase restrictions for the business in executing its development program. The weak points of Paint Pen Inc 2 Case Study Solution are offered as follows;
• Despite of being a science and technology publishing company, the business still has conventional methods ofpublishing which are not suitable with the growing technological shift.
• CMP highly relies over the Chinese markets for its growth. It should propose particular expansion plans to prevent its reliance over the Chinese markets to accomplish long term development.
The development of the publishing industry is decreasing given that 2008, impacting Paint Pen Inc 2 Case Study Solution as well, however the growth could be restored by availing specific opportunities presented in the market. The marketplace opportunities for CMP consist of;
• The business might also present Digital Publishing by using its long term technical experience and a strong client recognition 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 vast financial resources.
The altering macro trends in the market and increasing competition in the publishing industry has presented particular hazards to Paint Pen Inc 2 Case Study Solution including;( Gurel, 2017).
• Intro of digital publishing i.e. virtual libraries could cause decreasing market share of Paint Pen Inc 2 Case Study Solution due to the consumer shift towards virtual libraries.
• The existence of large number of rivals in the publishing market increase the hazard for CMP to lose its competitive position in the market, as rivals can acquire a strong consumer base by utilizing particular strategies like aggressive promotion, quality items, and so on
• Entryway of brand-new publishing firms in the market along with presence of high competition increases the hazard of losing the consumer base.
Due to lack of information, the financial ratios of CMP might not be calculated. It might be analyzed from the Appendix III that the annual total incomes of Paint Pen Inc 2 Case Study Solution during the duration 2000-2012 are growing at a high growth rate, revealing that the yearly demand of the products of CMP is growing and the business is quite efficient in bring in a large number of customers at a prospective cost.
Together with it, the 2nd chart which shows the annual development in the Paint Pen Inc 2 Case Study Help total assets, reveals that the company is quite effective in including value to its properties through its earnings. The growth in possessions reveals that the total worth of the firm is likewise increasing with increasing the overall profits. (Unknown, 2013).
Another financial analysis of the business using the given data might be the analysis regarding the circulation of overall earnings of the business. Huge 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 service segments with a possible development to achieve its future development objective.
PESTEL analysis might be performed to discover the various 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 company is offered as follows; (Alanzi, 2018).
As the publishing sector might have a substantial impact on the state of mind of the people about the communist ideology of the government, for that reason, the publishing sector is extremely monitored and guided by the Promotion Department of the Communist Celebration of China. Therefore, it might be said that the total political forces impacting Paint Pen Inc 2 Case Study Help service are high. The government policies concerning the publishing sector are likewise increasing with the passage of time.
Financial forces impacting the publishing sector in basic and the Paint Pen Inc 2 Case Study Help in specific includesthe costs of paper, the income level of customers, the inflation rate, and the total GDP development of the nation. All these forces integrate impact the demand for the publishing market. In addition to it, the financial policies related to the import of books impact the overall service at CPM. However, China's economic conditions are rather beneficial for CMP with high GDP growth and consumer income level.
Social and Demographical.
Social and demographical forces include the population growth, the consumer's preferences towards checking out helpful products and so on. China has the greatest population in the world with a high population growth, showing the increasing number of consumers of the Paint Pen Inc 2 Case Study Analysis. The consumer choices are moving towards digital publishing rather than the traditional was of publishing. In this regard, CMP should concentrate on digital publishing to satisfy the altering customer preferences.
Technological forces affecting the CMP include the technological development in the reading methods and so on. Enhancement of science and innovation along with the rise of digital publishing might minimize the demand for the CMP products, if certain actions would not be taken soon.
Environmental forces affecting Paint Pen Inc 2 Case Study Help consists of the concerns of ecological communities over the use 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 must not be harmful for the environment.
Legal regulations for the publishing sector at whole are high. Publishing Regulation 1997 requires the publishers to be approved first by the Government to be entered in the publishing market.
Industry Analysis (Porter's 5 Forces Model).
Porter's 5 Forces Design could be utilized to examine the appearance of the publishing industry China. A quick analysis of the Porter's 5 Forces is given as follows;.
Risk of New Entrants.
Risks of new entrants in the Chinese Publishing Industry is moderate. The prospective development in the industry tends to draw in new entrants to the publishing industry. The presence of extreme competition and the requirement of big capital tends to demotivate new entrants to enter in the market.
Danger of Substitution.
Danger of Replacement is high for the Chinese Publishing Industry. The alternative products for the released files is the files presented in the virtual libraries on certain websites. The altering consumer preferences towards digital knowing increase the danger of substitution for the market.
Competitive competition in the publishing industry is high. The existence of large number of consumers in the Chinese Publishing Industry like CIP, PTP and so on tends to produce high competitive competition for CMP. Along with it, new entrants are also participating in the market increasing the competitors for CMP.
Bargaining Power of Provider.
The major suppliers of the Paint Pen Inc 2 Case Study Help include the providers of the paper for publishing files. As CMP is the largest publisher in the Chinese Publishing Market, for that reason the overall bargaining power of provider for CMP is low.
Bargaining Power of Buyer.
Negotiating power of buyer in the publishing market is high. Due to the presence of a a great deal of publishers in the Chinese market and the marketplace saturation, the purchasers needs high quality files at competitive rates.
CMP runs in an extremely competitive market with the presence of a great deal of competitors. The company has a competitive position in the market with the greatest market share in the Chinese publishing market. Major competitors of Paint Pen Inc 2 Case Study Analysis include;.
• 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 might wean the market share of CMP easily in the present market circumstance.
Posts and telecommunication Press (PTP).
Another close rival of CMP is PTP. It was also founded in the very same duration as CMP and CIP. It ranks sixth in the state-owned publishers in terms of service scale. It is likewise one of the popular gamers in the publishing industry with a yearly total revenues of RMB 550 million in 2010.
Alternative-1: Broaden towards New Markets
• Reducing dependence over the Chinese markets.
• Increasing variety of Consumers
• Growth chances.
• Preventing the impact of market saturation in the Chinese publishing market.
• Use of potential resources in expansion.
• Risk of failure in new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
• Sustaining customer base.
• Approaching new markets.
• Easy to introduce using existing capabilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased product portfolio offers high value to consumers.
• Competitors in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core company sectors to the brand-new one can lead the business to lose demand of its products in the market.
With the deep analysis of the external and internal environment of the business along with the market analysis and the competitor analysis, Alternative 2 is recommended to CMP to attain its future advancement. As the preferences are moving towards digital publishing and the business require an immediate service to avoid the declining market growth. Therefore, introduction of digital publishing could prove to be an immediate solution with low amount of risk for the company. However, the company 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 must initially gathers the data related to the consumer need, the potential markets, the federal government policies and the data related to the competitors presented in the market. After that, the business needs to decide one prospective sector for its preliminary offering. It needs to collect research study that how it could separate its digital publishing from the existing rivals' products. The steps above the business must go for the preliminary offering. The company must go for the other markets if the initial offering shows a success. In this way the business would be able to implement its digital publishing program.
Although, the growth of the publishing industry is declining considering that 2008, revealing a risk to the company's long term presence, but the situation can be controlled by considering an advancement strategy in the future. The business could think about presenting digital publishingin its existing market to implement its development program at instant basis and to prevent the danger of failure for entryway in the brand-new markets.