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Risk And Reward In Venture Capital Case Analysis

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Risk And Reward In Venture Capital Case Study Solution and Analysis


Intro

Risk And Reward In Venture Capital Case Study Solution is the biggest publishing company with a highest market share in the China's book retail market. CMP supplies a variety of services including; collecting information, processing info and communication services. Major company segments of the business include; books, periodicals, consultancy and distribution. The business has a large product portfolio and its major items include books, periodicals, online media, exhibits, research reports etc. Risk And Reward In Venture Capital Case Study Help has become a specialized info service provider and a big comprehensive Science and Innovation publishing company through the combination of print media, audio-visual media and the network media.

Critical Problems

Although, Risk And Reward In Venture Capital Case Study Solution has actually spent its 60 years journey efficiently, being a successful publishing home, nevertheless, the altering macro market trends and forces bring specific challenges to the publishing market in basic and CMP in specific. These factors include;

• Entrance of the brand-new publishing firms in the market.
• Decreasing development of the publishing market.
• Market saturation.
• Intro of digital publishing strategies
• Enhancement of science and technology.
Executive Summary
The transformation 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 pursue the future development unceasingly? How could the business sustain its long term competitive position in future?

Situational Analysis
Internal Analysis
SWOT Analysis
Strengths


Risk And Reward In Venture Capital Case Study Analysis has specific strengths that can be used to minimize the risks, conquer the weakness and obtain the chances. Strengths of CMP are given as follows;

• The long term experience of Risk And Reward In Venture Capital Case Study Analysis in the publishing industry i.e. 60 years allows the company to offer high quality products at a lower cost using its previous experiences.
• The technical resources and abilities generated by its effective journey provide a competitive benefit to CMP.
• Large product portfolioof CMP assists it to diversify its danger and supply high worth to its clients.
• Strong monetary position enables the business to consider numerous development chances without any fear of raising fund externally.

Weak points

In addition to the strengths, the company has specific weaknesses which might increase restraints for the company in executing its advancement program. The weaknesses of Risk And Reward In Venture Capital Case Study Help are offered as follows;

• Despite of being a science and innovation publishing company, the business still has standard methods ofpublishing which are not suitable with the growing technological shift.
• CMP extremely relies over the Chinese markets for its development. It ought to propose specific growth plans to avoid its reliance over the Chinese markets to achieve long term development.
Porter's 5 Forces Analysis
Opportunities

Although, the development of the publishing industry is declining since 2008, affecting Risk And Reward In Venture Capital Case Study Help also, however the development could be revived by availing specific opportunities provided in the market. The marketplace chances for CMP consist of;

• The business could likewise present Digital Publishing by using its long term technical experience and a strong client acknowledgment in the market.
• CMP could think about a development program through the growth towards foreign markets in order to minimize its reliance over Chinese markets by using its huge funds.

Hazards

The altering macro patterns in the market and increasing competitors in the publishing industry has positioned certain threats to Risk And Reward In Venture Capital Case Study Solution including;( Gurel, 2017).

• Intro of digital publishing i.e. virtual libraries might lead to declining market share of Risk And Reward In Venture Capital Case Study Help due to the customer shift towards virtual libraries.
• The presence of a great deal of rivals in the publishing market increase the danger for CMP to lose its competitive position in the market, as rivals can gain a strong customer base by utilizing certain strategies like aggressive promotion, quality items, and so on
• Entrance of brand-new publishing firms in the industry in addition to presence of high competitors increases the hazard of losing the client base.

Monetary Analysis.
Swot Analysis
Due to absence of information, the monetary ratios of CMP might not be determined. It could be analyzed from the Appendix III that the yearly overall incomes of Risk And Reward In Venture Capital Case Study Solution throughout the period 2000-2012 are growing at a high growth rate, showing that the yearly need of the products of CMP is growing and the company is quite effective in drawing in a big number of clients at a prospective rate.

Together with it, the second graph which reveals the yearly development in the Risk And Reward In Venture Capital Case Study Analysis overall assets, shows that the business is quite efficient in including value to its assets through its earnings. The development in assets reveals that the overall worth of the firm is also increasing with increasing the overall profits. (Unidentified, 2013).

Another financial analysis of the business using the offered information could be the analysis concerning the circulation of overall profits 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 company could move towards other business segments with a prospective growth to achieve its future advancement objective.

PESTEL Analysis

PESTEL analysis could be performed to discover the various external forces impacting the performance of the business and the recent trends in the external environment of the company. A brief PESTEL analysis of the company is offered as follows; (Alanzi, 2018).

Political.

As the publishing sector could have a considerable effect on the frame of mind of individuals about the communist ideology of the federal government, therefore, the publishing sector is highly monitored and directed by the Publicity Department of the Communist Celebration of China. It might be said that the overall political forces impacting CMP business are high. The government policies concerning the publishing sector are likewise increasing with the passage of time.

Cost-effective.

Economic forces impacting the publishing sector in basic and the CMP in particular includesthe costs of paper, the earnings level of consumers, the inflation rate, and the overall GDP development of the country. All these forces combine effect the demand for the publishing market.

Social and Demographical.

The consumer choices are shifting towards digital publishing rather than the standard was of publishing. In this regard, CMP should focus on digital publishing to satisfy the altering consumer preferences.

Technological.

Technological forces impacting the CMP include the technological improvement in the reading techniques etc. Enhancement of science and technology in addition to the increase of digital publishing might decrease the demand for the CMP products, if certain actions would not be taken quickly.

Environmental.
Vrio Analysis
Ecological forces affecting Risk And Reward In Venture Capital Case Study Help consists of the issues of ecological communities over the usage of paper in publishing books. The paper used in the books while publishing is required to be non reusable and the ink utilized while publishing should not be harmful for the environment.

Legal.

Legal regulations for the publishing sector at whole are high. The legal guidelines concerning the publishing sector is managed by the General Administration of Press and Publication. Publishing Regulation 1997 requires the publishers to be authorized first by the Government to be entered in the publishing market. The ordinance prohibits direct participation of foreign entities and individuals in the publishing sector.

Market Analysis (Porter's Five Forces Design).

Porter's 5 Forces Model might be utilized to analyze the beauty of the publishing industry China. A quick analysis of the Porter's 5 Forces is provided as follows;.

Hazard of New Entrants.

Hazards of new entrants in the Chinese Publishing Industry is moderate. The possible growth in the market tends to bring in brand-new entrants to the publishing market. Nevertheless, the presence of extreme competitors and the requirement of big capital tends to demotivate new entrants to enter in the market.

Threat of Replacement.

Hazard of Alternative is high for the Chinese Publishing Industry. The alternative products for the released documents is the documents presented in the digital libraries on particular sites. The altering customer choices towards digital learning increase the hazard of replacement for the industry.

Competitive Competition.

Competitive competition in the publishing industry is high. The presence of large number of customers in the Chinese Publishing Market like CIP, PTP and so on tends to produce high competitive rivalry for CMP. Along with it, brand-new entrants are likewise participating in the market increasing the competitors for CMP.

Bargaining Power of Supplier.

The major suppliers of the Risk And Reward In Venture Capital Case Study Analysis include the suppliers of the paper for publishing documents. As CMP is the biggest publisher in the Chinese Publishing Market, therefore the total bargaining power of provider for CMP is low.

Bargaining Power of Buyer.

Bargaining power of purchaser in the publishing industry 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 documents at competitive rates.

Rivals Analysis.

CMP runs in an extremely competitive industry with the presence of a great deal of rivals. The company has a competitive position in the market with the highest market share in the Chinese publishing market. Significant rivals of Risk And Reward In Venture Capital Case Study Solution consist of;.

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

Chemical Industry Press (CIP).

CIP acts 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 CMP quickly in the current market situation.

Posts and telecommunication Press (PTP).

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

Alternatives

Alternative-1: Broaden towards New Markets

Pros

• Decreasing dependence over the Chinese markets.
• Increasing number of Clients
• Growth opportunities.
• Preventing the effect of market saturation in the Chinese publishing market.

Cons
Recommendations
• Use of potential resources in growth.
• Risk of failure in brand-new markets.
• Time consuming.

Alernative-2: Present Digital Publishing

Pros

• Sustaining customer base.
• Approaching new markets.
• Easy to introduce utilizing existing abilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased item portfolio offers high value to customers.

Cons

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

Recommendations

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 attain its future development. As the choices are shifting towards digital publishing and the company need an instant solution to prevent the declining market growth. Intro of digital publishing could show to be an instant service with low quantity of danger for the business. Nevertheless, the business might likewise consider the expansion program after the success of its digital publishing program.

Execution

In order to present digital publishing in its item portfolio, the company needs to initially gathers the information related to the customer demand, the possible markets, the government guidelines and the data related to the rivals presented in the market. If the initial offering proves a success, the company needs to go for the other markets. In this method the business would be able to execute its digital publishing program.

Conclusion

Although, the growth of the publishing industry is declining given that 2008, showing a threat to the business's long term existence, however the scenario can be controlled by thinking about a development strategy in the future. The business could consider presenting digital publishingin its existing market to execute its advancement program at immediate basis and to avoid the danger of failure for entryway in the new markets.

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