Procter And Gamble Company A Case Study Solution and Analysis
Intro
Procter And Gamble Company A Case Study Analysis is the largest publishing business with a greatest market share in the China's book retail market. CMP has actually become a specialized details service provider and a big extensive Science and Technology publishing business through the integration of print media, audio-visual media and the network media.
Crucial Problems
Although, Procter And Gamble Company A Case Study Solution has actually spent its 60 years journey smoothly, being an effective publishing house, nevertheless, the altering macro market trends and forces bring specific obstacles to the publishing industry in general and CMP in particular. These factors include;
• Entryway of the brand-new publishing firms in the industry.
• Decreasing development of the publishing market.
• Market saturation.
• Intro of digital publishing strategies
• Enhancement of science and innovation.
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 scenario? Do the long important experience, technical resources and the abilities of the business could be used to strive for the future development unceasingly? How could the business sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Procter And Gamble Company A Case Study Help has particular strengths that can be utilized to minimize the threats, get rid of the weakness and avail the opportunities. Strengths of CMP are offered as follows;
• The long term experience of Procter And Gamble Company A Case Study Help in the publishing industry i.e. 60 years permits the company to provide high quality items at a lower expense using its previous experiences.
• The technical resources and capabilities produced by its successful journey supply a competitive benefit to CMP.
• Large product portfolioof CMP helps it to diversify its danger and supply high worth to its customers.
• Strong financial position permits the company to think about a number of advancement opportunities with no worry of raising fund externally.
Weaknesses
Together with the strengths, the company has certain weak points which might increase restraints for the company in implementing its development program. The weaknesses of Procter And Gamble Company A Case Study Analysis are given as follows;
• Despite of being a science and innovation publishing company, the company still has standard ways 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 avoid its reliance over the Chinese markets to accomplish long term growth.
Opportunities
Although, the growth of the publishing market is declining since 2008, affecting Procter And Gamble Company A Case Study Help also, however the growth could be restored by availing particular opportunities provided in the market. The marketplace chances for CMP include;
• The company could also introduce Digital Publishing by utilizing its long term technical experience and a strong client acknowledgment in the market.
• CMP could consider a development program through the growth towards foreign markets in order to minimize its reliance over Chinese markets by using its huge funds.
Dangers
The altering macro patterns in the market and increasing competition in the publishing market has actually positioned specific hazards to Procter And Gamble Company A Case Study Help including;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries might cause decreasing market share of Procter And Gamble Company A Case Study Help due to the consumer shift towards digital libraries.
• The presence of a great deal of rivals in the publishing industry increase the risk for CMP to lose its competitive position in the market, as rivals can acquire a strong consumer base by using certain strategies like aggressive promo, quality products, etc.
• Entrance of new publishing companies in the industry in addition to existence of high competitors increases the risk of losing the customer base.
Financial Analysis.
Due to lack of information, the financial ratios of CMP could not be computed. It could be analyzed from the Appendix III that the annual total earnings of Procter And Gamble Company A Case Study Solution 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 business is rather efficient in drawing in a big number of customers at a possible price.
Along with it, the second chart which reveals the annual development in the Procter And Gamble Company A Case Study Solution total assets, reveals that the company is quite efficient in including worth to its properties through its earnings. The development in possessions shows that the total value of the company is likewise increasing with increasing the total revenues. (Unidentified, 2013).
Another monetary analysis of the company utilizing the offered data might be the analysis relating to the distribution of total revenues of the company. 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 business might move towards other service segments with a possible development to attain its future advancement objective.
PESTEL Analysis
PESTEL analysis might be carried out to discover the various external forces impacting the efficiency of the business and the recent trends in the external environment of the company. A short PESTEL analysis of the business is provided as follows; (Alanzi, 2018).
Political.
As the publishing sector could have a significant impact on the frame of mind of the people about the communist ideology of the federal government, therefore, the publishing sector is highly monitored and assisted by the Promotion Department of the Communist Party of China. Therefore, it could be stated that the total political forces impacting Procter And Gamble Company A Case Study Analysis service are high. The federal government policies concerning the publishing sector are likewise increasing with the passage of time.
Cost-effective.
Financial forces affecting the publishing sector in basic and the CMP in particular includesthe prices of paper, the earnings level of customers, the inflation rate, and the total GDP development of the nation. All these forces combine effect the demand for the publishing market.
Social and Demographical.
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 preferences.
Technological.
Technological forces affecting the CMP consist of the technological advancement in the reading techniques etc. Enhancement of science and innovation together with the increase of digital publishing might minimize the demand for the CMP products, if specific actions would not be taken quickly.
Environmental.
Ecological forces affecting Procter And Gamble Company A Case Study Solution consists of the issues of ecological communities over the usage of paper in publishing books. The paper utilized in the books while publishing is needed to be disposable and the ink utilized while publishing should not be harmful for the environment.
Legal.
Legal guidelines for the publishing sector at whole are high. The legal guidelines regarding the publishing sector is controlled by the General Administration of Press and Publication. Publishing Ordinance 1997 needs the publishers to be approved first by the Federal government to be entered in the publishing market. The regulation prohibits direct involvement of foreign entities and people in the publishing sector.
Industry Analysis (Porter's Five Forces Model).
Porter's Five Forces Design might be used to evaluate the beauty of the publishing industry China. A quick analysis of the Porter's 5 Forces is provided as follows;.
Risk of New Entrants.
Risks of brand-new entrants in the Chinese Publishing Industry is moderate. The prospective growth in the market tends to bring in new entrants to the publishing industry. However, the presence of intense competition and the requirement of substantial capital tends to demotivate brand-new entrants to go into in the marketplace.
Risk of Substitution.
Hazard of Alternative is high for the Chinese Publishing Market. The replacement items for the published documents is the files provided in the virtual libraries on specific websites. The altering customer preferences towards digital learning increase the hazard of alternative for the industry.
Competitive Competition.
Competitive competition in the publishing market is high. The presence 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, new entrants are also entering into the market increasing the competition for CMP.
Bargaining Power of Supplier.
The major suppliers of the Procter And Gamble Company A Case Study Analysis consist of the providers of the paper for releasing documents. As CMP is the largest publisher in the Chinese Publishing Market, therefore the overall bargaining power of provider for CMP is low.
Bargaining Power of Buyer.
Bargaining power of buyer in the publishing industry is high. Due to the presence of a large number of publishers in the Chinese market and the marketplace saturation, the purchasers needs high quality documents at competitive costs.
Rivals Analysis.
CMP operates in an extremely competitive industry with the existence of large number of rivals. However, the company has a competitive position in the market with the highest market share in the Chinese publishing market. Significant competitors of Procter And Gamble Company A Case Study Help include;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIPis one of the close rivals of CMP. Established in the exact same period, CIP releases similar type of books. For a big period, CIP held the largest market share, and still ranks 2nd and third in different market sections, with a significant focus on educational publications. CIP functions as a hazard for CMP as it could wean its market share due to its long term competitive background. CIP is focused on digital publishing and could wean the market share of Procter And Gamble Company A Case Study Analysis easily in the existing market scenario.
Posts and telecommunication Press (PTP).
It was also established in the same duration as Procter And Gamble Company A Case Study Analysis and CIP. It is likewise one of the popular players in the publishing industry with an annual overall incomes of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Reducing reliance over the Chinese markets.
• Increasing variety of Consumers
• 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 utilizing current capabilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased product portfolio offers high worth to consumers.
Cons
• Competitors in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core service sectors to the brand-new one can lead the company to lose demand of its items in the market.
Suggestions
With the deep analysis of the internal and external environment of the business in addition to the market analysis and the rival analysis, Alternative 2 is recommended to CMP to achieve its future development. As the choices are moving towards digital publishing and the business require an immediate option to avoid the declining market growth. Therefore, introduction of digital publishing could prove to be an instant service with low quantity of danger for the company. The business could likewise think about the expansion program after the success of its digital publishing program.
Application
In order to introduce digital publishing in its item portfolio, the company should initially gathers the information associated with the consumer demand, the potential markets, the federal government policies and the data connected to the rivals provided in the market. After that, the company needs to decide one possible segment for its preliminary offering. It needs to collect research that how it could distinguish its digital publishing from the existing rivals' items. The steps above the company ought to go for the initial offering. If the initial offering proves a success, the business must go for the other markets. In this method the company would be able to implement its digital publishing program.
Conclusion
Although, the growth of the publishing industry is declining given that 2008, showing a hazard to the business's long term existence, but the circumstance can be controlled by thinking about a development strategy in the future. The company might think about introducing digital publishingin its existing market to implement its development program at immediate basis and to avoid the threat of failure for entryway in the brand-new markets.
