Phelps Dodge Corporation 2 Case Study Solution and Analysis
Phelps Dodge Corporation 2 Case Study Analysis is the biggest publishing company with a highest market share in the China's book retail market. CMP offers a variety of services including; collecting information, processing information and interaction services. Major business sectors of the company consist of; books, regulars, consultancy and distribution. The business has a large product portfolio and its major products include books, periodicals, online media, exhibits, research study reports and so on. Phelps Dodge Corporation 2 Case Study Solution has ended up being a specialized info supplier and a big thorough Science and Innovation publishing business through the integration of print media, audio-visual media and the network media.
Although, Phelps Dodge Corporation 2 Case Study Solution has actually spent its 60 years journey efficiently, being a successful publishing home, however, the changing macro market trends and forces bring specific difficulties to the publishing industry in general and CMP in particular. These elements consist of;
• Entrance of the brand-new publishing firms in the market.
• Declining growth of the publishing market.
• Market saturation.
• Introduction of digital publishing strategies
• Enhancement of science and technology.
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 situation? Do the long important experience, technical resources and the capabilities of the company could be made use of to strive for the future development unceasingly? How could the business sustain its long term competitive position in future?
Phelps Dodge Corporation 2 Case Study Solution has certain strengths that can be utilized to lower the risks, overcome the weak point and avail the chances. Strengths of CMP are provided as follows;
• The long term experience of Phelps Dodge Corporation 2 Case Study Analysis in the publishing industry i.e. 60 years allows the company to provide high quality products at a lower expense using its prior experiences.
• The technical resources and abilities generated by its successful journey supply a competitive benefit to CMP.
• Vast product portfolioof CMP helps it to diversify its threat and supply high worth to its clients.
• Strong financial position allows the company to consider a number of advancement opportunities without any fear of raising fund externally.
Together with the strengths, the company has certain weak points which could increase constraints for the business in implementing its development program. The weaknesses of Phelps Dodge Corporation 2 Case Study Help are given as follows;
• Despite of being a science and technology publishing company, the business still has traditional ways ofpublishing which are not suitable with the growing technological shift.
• CMP extremely relies over the Chinese markets for its development. It should propose certain expansion strategies to prevent its dependence over the Chinese markets to attain long term development.
Although, the development of the publishing industry is declining given that 2008, affecting Phelps Dodge Corporation 2 Case Study Analysis as well, but the development might be revived by availing specific opportunities presented in the market. The marketplace opportunities for CMP consist of;
• The business might also introduce Digital Publishing by using its long term technical experience and a strong client recognition in the market.
• CMP might consider an advancement program through the expansion towards foreign markets in order to lower its reliance over Chinese markets by using its large funds.
The altering macro trends in the market and increasing competitors in the publishing market has posed particular risks to Phelps Dodge Corporation 2 Case Study Help including;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries might result in declining market share of Phelps Dodge Corporation 2 Case Study Solution due to the customer shift towards virtual libraries.
• The presence of large number of rivals in the publishing market increase the risk for CMP to lose its competitive position in the market, as competitors can get a strong consumer base by using particular strategies like aggressive promotion, quality items, etc.
• Entrance of new publishing firms in the industry together with existence of high competitors increases the danger of losing the client base.
Due to lack of data, the monetary ratios of CMP could not be calculated. It might be examined from the Appendix III that the annual total profits of Phelps Dodge Corporation 2 Case Study Analysis throughout the duration 2000-2012 are growing at a high development rate, revealing that the annual demand of the items of CMP is growing and the company is rather efficient in attracting a large number of clients at a possible cost.
Along with it, the second chart which reveals the annual development in the Phelps Dodge Corporation 2 Case Study Help overall possessions, shows that the company is rather efficient in including value to its properties through its profits. The growth in assets shows that the overall value of the firm is likewise increasing with increasing the total profits. (Unknown, 2013).
Another monetary analysis of the business utilizing the offered data might be the analysis relating to the circulation of overall incomes of the company. Major part of the incomes of CMP originates from the sales of its published books i.e. 64% as shown in the Case Appendix V. The company might move towards other service segments with a potential growth to attain its future advancement goal.
PESTEL analysis could be conducted to discover the numerous external forces affecting the performance of the business and the current trends in the external environment of the company. A quick PESTEL analysis of the business is given as follows; (Alanzi, 2018).
As the publishing sector might have a considerable impact on the frame of mind of the people about the communist ideology of the federal government, for that reason, the publishing sector is highly monitored and assisted by the Promotion Department of the Communist Celebration of China. Therefore, it might be said that the general political forces impacting Phelps Dodge Corporation 2 Case Study Analysis service are high. The government policies regarding the publishing sector are also increasing with the passage of time.
Financial forces affecting the publishing sector in general and the CMP in specific includesthe rates of paper, the income level of customers, the inflation rate, and the overall GDP growth of the country. All these forces combine impact the demand for the publishing market.
Social and Demographical.
Social and demographical forces include the population development, the consumer's choices towards reading useful materials and so on. China has the highest population worldwide with a high population growth, revealing the increasing variety of consumers of the Phelps Dodge Corporation 2 Case Study Analysis. The customer preferences are moving towards digital publishing rather than the conventional was of publishing. In this regard, CMP needs to focus on digital publishing to fulfill the altering customer choices.
Technological forces affecting the CMP include the technological improvement in the reading methods etc. Improvement of science and innovation in addition to the rise of digital publishing could reduce the demand for the CMP products, if certain actions would not be taken soon.
Environmental forces impacting Phelps Dodge Corporation 2 Case Study Solution consists of the issues of environmental 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 needs to not be damaging for the environment.
Legal regulations for the publishing sector at whole are high. The legal regulations regarding the publishing sector is managed by the General Administration of Press and Publication. Publishing Ordinance 1997 requires the publishers to be authorized initially by the Government to be gone into in the publishing market. The regulation prohibits direct involvement of foreign entities and people in the publishing sector.
Market Analysis (Porter's Five Forces Design).
Porter's 5 Forces Model could be used to evaluate the beauty of the publishing market China. A quick analysis of the Porter's Five Forces is offered as follows;.
Danger of New Entrants.
Dangers of new entrants in the Chinese Publishing Industry is moderate. The prospective growth in the market tends to draw in new entrants to the publishing market. The existence of intense competition and the requirement of substantial capital tends to demotivate brand-new entrants to enter in the market.
Hazard of Replacement.
Risk of Substitution is high for the Chinese Publishing Market. The alternative items for the published files is the files presented in the digital libraries on particular websites. The altering consumer choices towards digital learning increase the threat of replacement for the market.
Competitive rivalry in the publishing industry is high. The existence of a great deal 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 entering into the market increasing the competition for CMP.
Bargaining Power of Supplier.
The significant suppliers of the Phelps Dodge Corporation 2 Case Study Analysis consist of the providers 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 provider for CMP is low.
Bargaining Power of Buyer.
Negotiating power of buyer in the publishing industry is high. Due to the existence of a a great deal of publishers in the Chinese market and the marketplace saturation, the purchasers needs high quality files at competitive prices.
CMP operates 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. Significant rivals of Phelps Dodge Corporation 2 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 exact same duration, CIP publishes comparable type of books. For a large time period, CIP held the largest market share, and still ranks 2nd and third in various market sectors, with a significant concentrate on instructional publications. CIP acts as a threat for CMP as it could wean its market share due to its long term competitive background. CIP is concentrated on digital publishing and might wean the marketplace share of Phelps Dodge Corporation 2 Case Study Help quickly in the existing market circumstance.
Posts and telecommunication Press (PTP).
It was also established in the very same duration as Phelps Dodge Corporation 2 Case Study Solution and CIP. It is likewise one of the popular gamers in the publishing market with a yearly total earnings of RMB 550 million in 2010.
Alternative-1: Expand towards New Markets
• Minimizing dependence over the Chinese markets.
• Increasing number of Customers
• Growth chances.
• Avoiding the effect of market saturation in the Chinese publishing market.
• Usage of possible resources in growth.
• Threat of failure in new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
• Sustaining consumer base.
• Approaching new markets.
• Easy to present utilizing present capabilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased item portfolio provides high worth to customers.
• Competitors in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core business sections to the brand-new one can lead the business to lose need of its products in the market.
As the choices are moving towards digital publishing and the business need an instant solution to prevent the declining market growth. The company might also consider the growth program after the success of its digital publishing program.
In order to introduce digital publishing in its item portfolio, the company ought to first gathers the data related to the customer demand, the possible markets, the federal government regulations and the information related to the rivals provided in the market. After that, the company must decide one potential section for its preliminary offering. It must collect research study that how it might differentiate its digital publishing from the existing competitors' items. The steps above the business need to go for the preliminary offering. If the preliminary offering shows a success, the business ought to go for the other markets. In this way the company would have the ability to execute its digital publishing program.
Although, the development of the publishing industry is declining since 2008, showing a danger to the company's long term presence, but the situation can be controlled by thinking about a development strategy in the future. The company might think about presenting digital publishingin its existing market to implement its advancement program at instant basis and to prevent the risk of failure for entrance in the new markets.