Red Hen Baking Company Case Study Solution and Analysis
Red Hen Baking Company Case Study Solution is the biggest publishing business with a greatest market share in the China's book retail market. CMP supplies a number of services consisting of; gathering details, processing info and interaction services. Significant company sections of the business include; books, periodicals, consultancy and circulation. The company has a vast product portfolio and its significant products include books, periodicals, online media, exhibits, research study reports etc. Red Hen Baking Company Case Study Analysis has actually ended up being a specialized information company and a big detailed Science and Technology publishing business through the integration of print media, audio-visual media and the network media.
CMP has spent its 60 years journey smoothly, being a successful publishing house, nevertheless, the changing macro market patterns and forces bring certain obstacles to the publishing industry in basic and Red Hen Baking Company Case Study Solution in specific. These factors consist of;
• Entryway of the 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 improvement of the macro markets have raised several questions 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 used to pursue the future advancement unceasingly? How could the company sustain its long term competitive position in future?
Red Hen Baking Company Case Study Analysis has particular strengths that can be made use of to decrease the hazards, conquer the weak point and obtain the opportunities. Strengths of CMP are given as follows;
• The long term experience of Red Hen Baking Company Case Study Solution in the publishing market i.e. 60 years allows the business to provide high quality items at a lower cost utilizing its previous experiences.
• The technical resources and abilities generated by its successful journey offer a competitive advantage to CMP.
• Huge item portfolioof CMP assists it to diversify its risk and offer high value to its clients.
• Strong monetary position enables the company to think about several development opportunities with no fear of raising fund externally.
Together with the strengths, the business has specific weak points which could increase constraints for the business in implementing its development program. The weak points of Red Hen Baking Company Case Study Solution are given as follows;
• Despite of being a science and innovation publishing firm, the company still has conventional methods ofpublishing which are not compatible with the growing technological shift.
• CMP highly relies over the Chinese markets for its development. It must propose certain expansion strategies to avoid its dependence over the Chinese markets to attain long term development.
The growth of the publishing industry is decreasing since 2008, affecting Red Hen Baking Company Case Study Analysis as well, but the growth might be revived by availing specific opportunities presented in the market. The market chances for CMP include;
• The company might also introduce Digital Publishing by using its long term technical experience and a strong consumer acknowledgment in the market.
• CMP might consider a development program through the growth towards foreign markets in order to lower its dependence over Chinese markets by utilizing its large funds.
The altering macro patterns in the market and increasing competition in the publishing industry has presented certain hazards to Red Hen Baking Company Case Study Help consisting of;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries could cause decreasing market share of Red Hen Baking Company Case Study Help due to the customer shift towards virtual libraries.
• The presence of a great deal of competitors in the publishing market increase the threat for CMP to lose its competitive position in the market, as competitors can acquire a strong consumer base by using particular techniques like aggressive promotion, quality items, and so on
• Entryway of new publishing companies in the market along with existence of high competition increases the threat of losing the customer base.
The business has a rather competitive monetary performance. Due to lack of information, the financial ratios of CMP might not be calculated. However, the general monetary performance of the company might be analyzed by utilizing the charts given in the case Appendices. It could be examined from the Appendix III that the annual total earnings of CMP during the period 2000-2012 are growing at a high development rate, showing that the yearly demand of the items of Red Hen Baking Company Case Study Help is growing and the business is quite efficient in bring in a large number of consumers at a potential rate.
In addition to it, the 2nd graph which reveals the yearly growth in the Red Hen Baking Company Case Study Analysis overall possessions, shows that the company is quite effective in including value to its assets through its incomes. The development in assets shows that the total value of the company is also increasing with increasing the overall revenues. (Unidentified, 2013).
Another financial analysis of the business using the offered information might be the analysis concerning the circulation of overall incomes of the business. Huge part of the earnings of CMP originates from the sales of its released books i.e. 64% as shown in the Case Appendix V. The business might move towards other organisation sections with a prospective development to achieve its future advancement goal.
PESTEL analysis might be performed to discover the different external forces impacting the efficiency of the company and the recent trends in the external environment of the business. A short PESTEL analysis of the business is offered as follows; (Alanzi, 2018).
As the publishing sector might have a considerable impact on the mindset of the people about the communist ideology of the federal government, therefore, the publishing sector is extremely monitored and directed by the Promotion Department of the Communist Party of China. It might be stated that the general political forces affecting CMP company are high. The federal government policies concerning the publishing sector are also increasing with the passage of time.
Economic forces affecting the publishing sector in general and the Red Hen Baking Company Case Study Analysis in particular includesthe rates of paper, the earnings level of consumers, the inflation rate, and the total GDP development of the country. All these forces combine effect the demand for the publishing market. Together with it, the financial policies associated with the import of books affect the general organisation at CPM. Nevertheless, China's economic conditions are rather favorable for CMP with high GDP growth and customer income level.
Social and Demographical.
The customer choices are moving towards digital publishing rather than the traditional was of publishing. In this regard, CMP should focus on digital publishing to satisfy the changing customer preferences.
Technological forces affecting the CMP include the technological development in the reading strategies etc. Enhancement of science and innovation in addition to the increase of digital publishing might decrease the demand for the CMP products, if specific actions would not be taken soon.
Environmental forces affecting Red Hen Baking Company Case Study Help consists of 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 non reusable and the ink used while publishing needs to not be hazardous for the environment.
Legal guidelines for the publishing sector at whole are high. Publishing Ordinance 1997 requires the publishers to be approved first by the Federal government to be gone into in the publishing market.
Market Analysis (Porter's Five Forces Design).
Porter's Five Forces Model might be used to analyze the beauty of the publishing industry China. A quick analysis of the Porter's Five Forces is given as follows;.
Risk of New Entrants.
Dangers of new entrants in the Chinese Publishing Market is moderate. The possible development in the industry tends to attract brand-new entrants to the publishing market. However, the presence of intense competitors and the requirement of substantial capital tends to demotivate brand-new entrants to go into in the marketplace.
Hazard of Substitution.
Threat of Alternative is high for the Chinese Publishing Industry. The replacement products for the released documents is the files provided in the digital libraries on particular sites. The altering customer choices towards digital knowing increase the risk of alternative for the industry.
Competitive rivalry in the publishing industry is high. The presence of large number of consumers in the Chinese Publishing Market like CIP, PTP etc. tends to produce high competitive rivalry for CMP. In addition to it, brand-new entrants are also entering into the marketplace increasing the competitors for CMP.
Bargaining Power of Provider.
The major suppliers of the Red Hen Baking Company Case Study Solution consist of the suppliers of the paper for releasing 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 Buyer.
Negotiating power of purchaser in the publishing market is high. Due to the existence of a a great deal of publishers in the Chinese market and the market saturation, the buyers requires high quality files at competitive rates.
CMP runs in a highly competitive industry with the presence of a great deal of competitors. Nevertheless, the company has a competitive position in the market with the highest market share in the Chinese publishing market. Major competitors of Red Hen Baking Company Case Study Analysis include;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIPis one of the close competitors of CMP. Established in the same duration, CIP publishes comparable type of books. For a large time period, CIP held the biggest market share, and still ranks third and second in numerous market sections, with a major focus on academic publications. CIP serves as a danger 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 market share of Red Hen Baking Company Case Study Analysis quickly in the existing market situation.
Posts and telecommunication Press (PTP).
It was also founded in the exact same period as Red Hen Baking Company Case Study Solution and CIP. It is likewise one of the popular players in the publishing industry with an annual overall revenues of RMB 550 million in 2010.
Alternative-1: Broaden towards New Markets
• Lowering reliance over the Chinese markets.
• Increasing number of Clients
• Development opportunities.
• Avoiding the impact of market saturation in the Chinese publishing market.
• Use of prospective resources in growth.
• Threat of failure in brand-new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
• Sustaining customer base.
• Approaching new markets.
• Easy to present utilizing current capabilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased item portfolio provides high value to clients.
• Competitors in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core service segments to the brand-new one can lead the business to lose need of its products in the market.
As the preferences are shifting towards digital publishing and the business need an immediate service to avoid the declining market growth. The company might likewise consider the growth program after the success of its digital publishing program.
In order to present digital publishing in its product portfolio, the business ought to initially gathers the data related to the customer demand, the potential markets, the federal government regulations and the data related to the competitors provided in the market. If the preliminary offering proves a success, the company ought to go for the other markets. In this method the business would be able to implement its digital publishing program.
The growth of the publishing market is declining considering that 2008, revealing a danger to the company's long term existence, but the situation can be managed by thinking about an advancement strategy in the future. The business might think about presenting digital publishingin its existing market to implement its development program at immediate basis and to avoid the threat of failure for entrance in the brand-new markets.