River Bend Trading Navigating Rough Waters Case Study Solution and Analysis
River Bend Trading Navigating Rough Waters Case Study Help is the largest publishing company with a highest market share in the China's book retail market. CMP has become a specialized details provider and a large detailed Science and Innovation publishing business through the integration of print media, audio-visual media and the network media.
CMP has actually invested its 60 years journey smoothly, being a successful publishing home, however, the changing macro market patterns and forces bring certain difficulties to the publishing industry in general and River Bend Trading Navigating Rough Waters Case Study Help in particular. These factors include;
• Entryway of the brand-new publishing firms in the industry.
• Declining development of the publishing market.
• Market saturation.
• Introduction of digital publishing strategies
• Enhancement of science and innovation.
The improvement of the macro markets have raised several 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 company sustain its long term competitive position in future?
River Bend Trading Navigating Rough Waters Case Study Solution has certain strengths that can be utilized to reduce the risks, conquer the weakness and obtain the chances. Strengths of CMP are offered as follows;
• The long term experience of River Bend Trading Navigating Rough Waters Case Study Analysis in the publishing market i.e. 60 years enables the business to offer high quality products at a lower cost utilizing its previous experiences.
• The technical resources and abilities created by its effective journey provide a competitive benefit to CMP.
• Large item portfolioof CMP helps it to diversify its danger and provide high value to its clients.
• Strong financial position enables the business to think about several advancement opportunities with no fear of raising fund externally.
Together with the strengths, the business has particular weak points which could increase restrictions for the business in executing its development program. The weak points of River Bend Trading Navigating Rough Waters Case Study Help are given as follows;
• Despite of being a science and technology publishing company, the company still has standard 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 plans to avoid its dependence over the Chinese markets to accomplish long term development.
The growth of the publishing industry is decreasing considering that 2008, affecting River Bend Trading Navigating Rough Waters Case Study Help as well, but the growth could be revived by availing certain opportunities presented in the market. The market opportunities for CMP include;
• The business might likewise present Digital Publishing by using its long term technical experience and a strong customer recognition in the market.
• CMP might consider an advancement program through the growth towards foreign markets in order to lower its reliance over Chinese markets by utilizing its huge financial resources.
The changing macro trends in the market and increasing competitors in the publishing market has actually presented specific hazards to River Bend Trading Navigating Rough Waters Case Study Help consisting of;( Gurel, 2017).
• Intro of digital publishing i.e. virtual libraries could cause declining market share of River Bend Trading Navigating Rough Waters Case Study Solution due to the consumer shift towards digital libraries.
• The presence of large number of rivals in the publishing industry increase the hazard for CMP to lose its competitive position in the market, as competitors can acquire a strong customer base by using specific methods like aggressive promotion, quality products, and so on
• Entrance of brand-new publishing firms in the market together with presence of high competition increases the threat of losing the consumer base.
Due to lack of information, the financial ratios of CMP could not be calculated. It might be analyzed from the Appendix III that the yearly overall revenues of River Bend Trading Navigating Rough Waters Case Study Analysis throughout the period 2000-2012 are growing at a high development rate, showing that the annual need of the products of CMP is growing and the company is rather efficient in drawing in a big number of customers at a possible price.
Along with it, the 2nd graph which shows the annual development in the River Bend Trading Navigating Rough Waters Case Study Analysis total possessions, shows that the company is quite efficient in including value to its assets through its profits. The development in possessions reveals that the total worth of the company is likewise increasing with increasing the overall profits. (Unidentified, 2013).
Another monetary analysis of the company utilizing the given data could be the analysis relating to the distribution of overall profits of the company. Huge part of the profits of CMP comes from the sales of its released books i.e. 64% as displayed in the Case Appendix V. The company could move towards other service sections with a prospective development to achieve its future advancement objective.
PESTEL analysis could be conducted to discover the different external forces impacting the performance of the company and the recent trends in the external environment of the business. A brief PESTEL analysis of the business is given as follows; (Alanzi, 2018).
As the publishing sector might have a significant impact on the state of mind of individuals 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 could be said that the overall political forces impacting CMP company are high. The federal 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 particular includesthe prices of paper, the income level of customers, the inflation rate, and the general GDP growth of the nation. All these forces integrate effect the need for the publishing market.
Social and Demographical.
The customer choices are shifting towards digital publishing rather than the traditional was of publishing. In this regard, CMP ought to focus on digital publishing to satisfy the changing consumer choices.
Technological forces impacting the CMP consist of the technological development in the reading techniques and so on. Enhancement of science and innovation together with the rise of digital publishing could lower the demand for the CMP products, if certain actions would not be taken quickly.
Ecological forces affecting River Bend Trading Navigating Rough Waters Case Study Solution consists of the concerns of ecological neighborhoods over the usage of paper in publishing books. The paper used in the books while publishing is required to be disposable and the ink used while publishing must not be damaging for the environment.
Legal policies for the publishing sector at whole are high. The legal regulations concerning the publishing sector is controlled by the General Administration of Press and Publication. Publishing Regulation 1997 requires 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 individuals in the publishing sector.
Market Analysis (Porter's Five Forces Design).
Porter's 5 Forces Model might be used to evaluate the attractiveness of the publishing market China. A quick analysis of the Porter's Five Forces is offered as follows;.
Threat of New Entrants.
Risks of brand-new entrants in the Chinese Publishing Market is moderate. The potential growth in the industry tends to draw in brand-new entrants to the publishing industry. The existence of intense competitors and the requirement of big capital tends to demotivate brand-new entrants to enter in the market.
Threat of Substitution.
Danger of Replacement is high for the Chinese Publishing Market. The replacement items for the released files is the documents presented in the virtual libraries on specific websites. The altering customer choices towards digital learning increase the danger of alternative for the industry.
Competitive rivalry in the publishing market is high. The presence of large number of customers in the Chinese Publishing Market like CIP, PTP etc. tends to produce high competitive competition for CMP. Together with it, new entrants are also participating in the market increasing the competition for CMP.
Bargaining Power of Provider.
The significant suppliers of the River Bend Trading Navigating Rough Waters Case Study Help include the providers of the paper for releasing files. As CMP is the largest publisher in the Chinese Publishing Market, for that reason the overall bargaining power of supplier for CMP is low.
Bargaining Power of Buyer.
Negotiating power of buyer in the publishing market 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 costs.
CMP runs in a highly competitive industry 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 River Bend Trading Navigating Rough Waters Case Study Help consist of;.
• 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 period, CIP publishes comparable type of books. For a large time period, CIP held the largest market share, and still ranks second and 3rd in different market sectors, with a major focus on educational publications. CIP functions as a risk for CMP as it could wean its market share due to its long term competitive background. CIP is focused on digital publishing and might wean the marketplace share of River Bend Trading Navigating Rough Waters Case Study Solution quickly in the present market circumstance.
Posts and telecommunication Press (PTP).
Another close rival of CMP is PTP. It was likewise founded in the very 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 incomes of RMB 550 million in 2010.
Alternative-1: Broaden towards New Markets
• Lowering reliance over the Chinese markets.
• Increasing number of Clients
• Growth chances.
• Avoiding the impact of market saturation in the Chinese publishing industry.
• Use of possible resources in growth.
• Danger of failure in brand-new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
• Sustaining consumer base.
• Approaching brand-new markets.
• Easy to introduce utilizing current capabilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased item portfolio supplies high worth to consumers.
• Competition 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 company to lose need of its items in the market.
With the deep analysis of the internal and external environment of the business along with the industry analysis and the rival analysis, Alternative 2 is suggested to CMP to achieve its future development. As the choices are shifting towards digital publishing and the company need an instant solution to avoid the decreasing industry growth. Intro of digital publishing might show to be an immediate solution with low quantity of danger for the company. Nevertheless, the company could likewise think about the growth program after the success of its digital publishing program.
In order to introduce digital publishing in its product portfolio, the business ought to initially collects the information related to the customer demand, the prospective markets, the federal government regulations and the information related to the rivals presented in the market. If the initial offering proves a success, the company ought to go for the other markets. In this method the company would be able to execute its digital publishing program.
Although, the growth of the publishing industry is declining since 2008, showing a risk to the business's long term presence, however the scenario can be managed by thinking about an advancement strategy in the future. The company might think about presenting digital publishingin its existing market to implement its advancement program at immediate basis and to avoid the risk of failure for entrance in the brand-new markets.