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Pennycook Power Boats Considering An Offer To Sell The Firm Case Solution

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Pennycook Power Boats Considering An Offer To Sell The Firm Case Study Solution and Analysis


Introduction

Pennycook Power Boats Considering An Offer To Sell The Firm Case Study Analysis is the largest publishing company with a highest market share in the China's book retail market. CMP has become a specialized info provider and a big thorough Science and Technology publishing company through the integration of print media, audio-visual media and the network media.

Important Problems

CMP has spent its 60 years journey efficiently, being an effective publishing home, nevertheless, the altering macro market patterns and forces bring specific obstacles to the publishing market in basic and Pennycook Power Boats Considering An Offer To Sell The Firm Case Study Help in particular. These aspects consist of;

• Entryway of the new publishing companies in the industry.
• Declining growth of the publishing market.
• Market saturation.
• Introduction of digital publishing strategies
• Enhancement of science and innovation.
Executive Summary
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 circumstance? Do the long valuable experience, technical resources and the capabilities of the company could be used 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


Pennycook Power Boats Considering An Offer To Sell The Firm Case Study Analysis has particular strengths that can be used to decrease the threats, get rid of the weakness and avail the opportunities. Strengths of CMP are given as follows;

• The long term experience of Pennycook Power Boats Considering An Offer To Sell The Firm Case Study Help in the publishing industry i.e. 60 years allows the business to supply high quality items at a lower cost utilizing its previous experiences.
• The technical resources and abilities created by its successful journey provide a competitive benefit to CMP.
• Huge product portfolioof CMP helps it to diversify its danger and offer high worth to its customers.
• Strong monetary position enables the company to consider numerous advancement opportunities with no worry of raising fund externally.

Weak points

Along with the strengths, the business has particular weaknesses which might increase constraints for the company in implementing its development program. The weaknesses of Pennycook Power Boats Considering An Offer To Sell The Firm Case Study Help are given as follows;

• Despite of being a science and innovation publishing company, the company still has conventional ways ofpublishing which are not suitable with the growing technological shift.
• CMP highly relies over the Chinese markets for its development. It ought to propose certain growth strategies to prevent its reliance over the Chinese markets to accomplish long term growth.
Porter's 5 Forces Analysis
Opportunities

Although, the growth of the publishing market is declining given that 2008, affecting Pennycook Power Boats Considering An Offer To Sell The Firm Case Study Help also, however the development might be revived by availing specific opportunities provided in the market. The marketplace opportunities for CMP include;

• The business could also present Digital Publishing by utilizing its long term technical experience and a strong client recognition in the market.
• CMP might think about an advancement program through the expansion towards foreign markets in order to minimize its reliance over Chinese markets by using its large financial resources.

Hazards

The altering macro patterns in the market and increasing competitors in the publishing industry has actually positioned certain dangers to Pennycook Power Boats Considering An Offer To Sell The Firm Case Study Solution including;( Gurel, 2017).

• Intro of digital publishing i.e. digital libraries might result in decreasing market share of Pennycook Power Boats Considering An Offer To Sell The Firm 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 rivals can gain a strong customer base by using specific methods like aggressive promotion, quality products, and so on
• Entrance of brand-new publishing firms in the industry along with existence of high competitors increases the threat of losing the client base.

Financial Analysis.
Swot Analysis
Due to absence of information, the financial ratios of CMP could not be calculated. It could be examined from the Appendix III that the annual overall incomes of Pennycook Power Boats Considering An Offer To Sell The Firm Case Study Help during the period 2000-2012 are growing at a high growth rate, showing that the annual need of the products of CMP is growing and the business is rather efficient in attracting a large number of clients at a prospective price.

Along with it, the 2nd chart which shows the annual growth in the Pennycook Power Boats Considering An Offer To Sell The Firm Case Study Analysis total properties, reveals that the business is quite effective in including worth to its properties through its profits. The growth in properties reveals that the total worth of the firm is also increasing with increasing the overall revenues. (Unidentified, 2013).

Another financial analysis of the company utilizing the provided information might be the analysis concerning the distribution of total revenues 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 company sections with a possible development to accomplish its future advancement goal.

PESTEL Analysis

PESTEL analysis could be performed to learn the different external forces impacting the efficiency of the business 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 influence on the mindset of the people about the communist ideology of the federal government, therefore, the publishing sector is extremely monitored and guided by the Promotion Department of the Communist Celebration of China. It could be stated that the overall political forces impacting CMP company are high. The federal government policies relating to the publishing sector are also increasing with the passage of time.

Affordable.

Economic forces impacting the publishing sector in general and the Pennycook Power Boats Considering An Offer To Sell The Firm Case Study Solution in particular includesthe prices of paper, the earnings level of customers, the inflation rate, and the general GDP growth of the country. All these forces integrate impact the demand for the publishing market. In addition to it, the financial policies associated with the import of books affect the overall organisation at CPM. However, China's economic conditions are quite beneficial for CMP with high GDP development and customer earnings level.

Social and Demographical.

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

Technological.

Technological forces impacting the CMP include the technological development in the reading techniques and so on. Enhancement of science and innovation in addition to the rise of digital publishing might minimize the demand for the CMP items, if specific actions would not be taken soon.

Environmental.
Vrio Analysis
Ecological forces affecting Pennycook Power Boats Considering An Offer To Sell The Firm Case Study Solution includes the concerns of environmental communities over the use of paper in publishing books. The paper used in the books while publishing is required to be disposable and the ink utilized while publishing ought to not be hazardous for the environment.

Legal.

Legal guidelines for the publishing sector at whole are high. Publishing Ordinance 1997 requires the publishers to be approved initially by the Government to be gone into in the publishing market.

Market Analysis (Porter's Five Forces Model).

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

Threat of New Entrants.

Threats of new entrants in the Chinese Publishing Industry is moderate. The possible growth in the market tends to attract brand-new entrants to the publishing market. However, the presence of intense competition and the requirement of substantial capital tends to demotivate new entrants to enter in the marketplace.

Risk of Substitution.

Risk of Alternative is high for the Chinese Publishing Industry. The alternative products for the released files is the documents presented in the virtual libraries on certain sites. The changing consumer choices towards digital learning increase the risk of alternative for the industry.

Competitive Rivalry.

Competitive rivalry in the publishing industry is high. The presence of large number of consumers in the Chinese Publishing Industry like CIP, PTP and so on tends to produce high competitive competition for CMP. In addition to it, brand-new entrants are also entering into the market increasing the competitors for CMP.

Bargaining Power of Supplier.

The significant providers of the Pennycook Power Boats Considering An Offer To Sell The Firm Case Study Analysis include the providers of the paper for publishing documents. As CMP is the biggest publisher in the Chinese Publishing Market, therefore the total bargaining power of supplier for CMP is low.

Bargaining Power of Buyer.

Haggling power of purchaser 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 needs high quality documents at competitive rates.

Rivals Analysis.

CMP operates in an extremely competitive market with the presence of large number of rivals. The company has a competitive position in the market with the highest market share in the Chinese publishing market. Significant rivals of Pennycook Power Boats Considering An Offer To Sell The Firm Case Study Analysis include;.

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

Chemical Market Press (CIP).

CIPis among the close rivals of CMP. Established in the same duration, CIP publishes similar type of books. For a large time period, CIP held the biggest market share, and still ranks 2nd and 3rd in different market sectors, with a major focus on instructional publications. CIP serves as a hazard 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 Pennycook Power Boats Considering An Offer To Sell The Firm Case Study Solution easily in the existing market circumstance.

Posts and telecommunication Press (PTP).

Another close rival of CMP is PTP. It was likewise founded in the same duration as CMP and CIP. It ranks 6th in the state-owned publishers in regards to company scale. It is also among the popular players in the publishing market with an annual total revenues of RMB 550 million in 2010.

Alternatives

Alternative-1: Broaden towards New Markets

Pros

• Lowering dependence over the Chinese markets.
• Increasing number of Clients
• Development opportunities.
• Preventing the impact of market saturation in the Chinese publishing industry.

Cons
Recommendations
• Use of possible resources in expansion.
• Danger of failure in brand-new markets.
• Time consuming.

Alernative-2: Introduce Digital Publishing

Pros

• Sustaining consumer base.
• Approaching new markets.
• Easy to introduce using current abilities.
• Low risk of Failure.
• Low requirement for funds.
• Increased product portfolio supplies high worth to customers.

Cons

• Competition in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core business sections to the brand-new one can lead the business to lose demand of its items in the market.

Suggestions

As the choices are moving towards digital publishing and the company require an instant option to avoid the declining market growth. The company could likewise think about the growth program after the success of its digital publishing program.

Execution

In order to present digital publishing in its product portfolio, the company needs to first gathers the information related to the consumer need, the possible markets, the federal government policies and the information related to the rivals presented in the market. If the preliminary offering proves a success, the company needs to go for the other markets. In this method the business would be able to implement its digital publishing program.

Conclusion

Although, the development of the publishing industry is decreasing given that 2008, showing a risk to the company's long term existence, but the circumstance can be controlled by thinking about a development strategy in the future. The business could consider introducing digital publishingin its existing market to implement its advancement program at immediate basis and to avoid the danger of failure for entrance in the new markets.

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