Secondmarket Providing Liquidity For Shareholders Of Privately Held Icontact Case Study Solution and Analysis
Secondmarket Providing Liquidity For Shareholders Of Privately Held Icontact Case Study Solution is the largest publishing company with a greatest market share in the China's book retail market. CMP has actually become a specialized info provider and a big comprehensive Science and Technology publishing business through the combination of print media, audio-visual media and the network media.
CMP has invested its 60 years journey smoothly, being an effective publishing home, nevertheless, the altering macro market trends and forces bring particular difficulties to the publishing market in general and Secondmarket Providing Liquidity For Shareholders Of Privately Held Icontact Case Study Solution in specific. These elements include;
• Entrance of the new publishing companies in the market.
• Declining growth of the publishing market.
• Market saturation.
• Intro of digital publishing techniques
• Improvement of science and technology.
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 circumstance? Do the long important experience, technical resources and the capabilities of the company could be used to strive for the future advancement unceasingly? How could the business sustain its long term competitive position in future?
Secondmarket Providing Liquidity For Shareholders Of Privately Held Icontact Case Study Help has specific strengths that can be utilized to lower the hazards, overcome the weak point and avail the chances. Strengths of CMP are offered as follows;
• The long term experience of Secondmarket Providing Liquidity For Shareholders Of Privately Held Icontact Case Study Solution in the publishing industry i.e. 60 years enables the business to supply high quality items at a lower expense utilizing its previous experiences.
• The technical resources and capabilities generated by its effective journey offer a competitive advantage to CMP.
• Huge item portfolioof CMP assists it to diversify its risk and offer high value to its customers.
• Strong financial position allows the company to think about a number of development opportunities without any fear of raising fund externally.
In addition to the strengths, the company has particular weak points which could increase restraints for the company in implementing its advancement program. The weak points of Secondmarket Providing Liquidity For Shareholders Of Privately Held Icontact Case Study Solution are provided as follows;
• Despite of being a science and technology publishing firm, the company still has conventional methods ofpublishing which are not suitable with the growing technological shift.
• CMP highly relies over the Chinese markets for its growth. It must propose certain growth strategies to avoid its dependence over the Chinese markets to accomplish long term growth.
Although, the development of the publishing industry is decreasing given that 2008, affecting Secondmarket Providing Liquidity For Shareholders Of Privately Held Icontact Case Study Analysis as well, but the growth could be revived by availing certain opportunities provided in the market. The marketplace chances for CMP include;
• The business could also present Digital Publishing by utilizing its long term technical experience and a strong consumer recognition in the market.
• CMP could consider an advancement program through the expansion towards foreign markets in order to decrease its dependence over Chinese markets by utilizing its vast financial resources.
The altering macro patterns in the market and increasing competition in the publishing market has actually postured particular hazards to Secondmarket Providing Liquidity For Shareholders Of Privately Held Icontact Case Study Help including;( Gurel, 2017).
• Introduction of digital publishing i.e. digital libraries could result in decreasing market share of Secondmarket Providing Liquidity For Shareholders Of Privately Held Icontact Case Study Help due to the customer shift towards digital libraries.
• The presence of large number of competitors 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 utilizing particular strategies like aggressive promotion, quality products, and so on
• Entrance of new publishing firms in the market in addition to existence of high competitors increases the hazard of losing the client base.
The business has a quite competitive financial efficiency. Due to lack of data, the financial ratios of CMP might not be determined. However, the general monetary performance of the company could be evaluated by using the charts given up the case Appendices. It might be analyzed from the Appendix III that the annual total revenues of CMP throughout the duration 2000-2012 are growing at a high development rate, revealing that the annual demand of the items of Secondmarket Providing Liquidity For Shareholders Of Privately Held Icontact Case Study Help is growing and the company is rather efficient in attracting a a great deal of clients at a possible price.
In addition to it, the 2nd chart which reveals the yearly development in the Secondmarket Providing Liquidity For Shareholders Of Privately Held Icontact Case Study Help overall assets, shows that the company is rather effective in adding value to its properties through its earnings. The development in assets reveals that the overall worth of the firm is likewise increasing with increasing the total earnings. (Unidentified, 2013).
Another monetary analysis of the business using the offered data could be the analysis relating to the circulation of overall earnings of the company. Major part of the profits of CMP originates from the sales of its released books i.e. 64% as shown in the Case Appendix V. The business could move towards other organisation segments with a possible growth to achieve its future development objective.
PESTEL analysis might be conducted to learn the numerous external forces affecting the efficiency of the company and the recent trends in the external environment of the company. A short PESTEL analysis of the company is offered as follows; (Alanzi, 2018).
As the publishing sector could have a significant influence on the frame of mind of the people about the communist ideology of the federal government, for that reason, the publishing sector is highly supervised and assisted by the Promotion Department of the Communist Party of China. For that reason, it might be stated that the general political forces impacting Secondmarket Providing Liquidity For Shareholders Of Privately Held Icontact Case Study Analysis company are high. The government policies regarding the publishing sector are likewise increasing with the passage of time.
Financial forces affecting the publishing sector in basic and the Secondmarket Providing Liquidity For Shareholders Of Privately Held Icontact Case Study Solution in specific includesthe rates of paper, the earnings level of customers, the inflation rate, and the general GDP growth of the nation. All these forces integrate impact the need for the publishing market. Together with it, the financial policies associated with the import of books affect the total organisation at CPM. China's economic conditions are rather favorable for CMP with high GDP growth and customer earnings level.
Social and Demographical.
Social and demographical forces consist of the population development, the consumer's preferences towards checking out helpful products etc. China has the highest population worldwide with a high population development, showing the increasing number of consumers of the Secondmarket Providing Liquidity For Shareholders Of Privately Held Icontact Case Study Help. The consumer preferences are shifting towards digital publishing rather than the conventional was of publishing. In this regard, CMP should focus on digital publishing to meet the changing consumer choices.
Technological forces impacting the CMP consist of the technological improvement in the reading methods and so on. Enhancement of science and technology together with the increase of digital publishing might minimize the need for the CMP products, if specific actions would not be taken soon.
Environmental forces impacting Secondmarket Providing Liquidity For Shareholders Of Privately Held Icontact Case Study Help includes the concerns of environmental neighborhoods over the usage of paper in publishing books. The paper utilized in the books while publishing is needed to be disposable and the ink used while publishing ought to not be harmful for the environment.
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 gone into in the publishing market. The ordinance prohibits direct participation of foreign entities and individuals in the publishing sector.
Market Analysis (Porter's 5 Forces Design).
Porter's 5 Forces Model might be utilized to analyze the attractiveness of the publishing market China. A brief analysis of the Porter's Five Forces is offered as follows;.
Risk of New Entrants.
Hazards of brand-new entrants in the Chinese Publishing Market is moderate. The potential growth in the industry tends to bring in new entrants to the publishing market. However, the existence of extreme competition and the requirement of big capital tends to demotivate new entrants to enter in the marketplace.
Hazard of Alternative.
Hazard of Replacement is high for the Chinese Publishing Industry. The replacement items for the published files is the documents provided in the digital libraries on particular websites. The altering consumer choices towards digital learning increase the risk of alternative for the market.
Competitive rivalry in the publishing industry is high. The presence of a great deal of consumers in the Chinese Publishing Market like CIP, PTP and so on tends to produce high competitive rivalry for CMP. In addition to it, brand-new entrants are also participating in the market increasing the competition for CMP.
Bargaining Power of Supplier.
The significant suppliers of the Secondmarket Providing Liquidity For Shareholders Of Privately Held Icontact Case Study Help consist of the providers of the paper for releasing documents. As CMP is the biggest publisher in the Chinese Publishing Market, therefore the total bargaining power of supplier for CMP is low.
Bargaining Power of Purchaser.
Bargaining power of buyer in the publishing market 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 documents at competitive rates.
CMP runs in an extremely competitive market with the presence of large number of rivals. However, the company has a competitive position in the market with the greatest market share in the Chinese publishing market. Significant competitors of Secondmarket Providing Liquidity For Shareholders Of Privately Held Icontact Case Study Analysis include;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIPis among the close competitors of CMP. Founded in the very same duration, CIP publishes similar type of books. For a large period, CIP held the largest market share, and still ranks second and 3rd in various market sections, with a major concentrate on educational publications. CIP serves 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 could wean the marketplace share of Secondmarket Providing Liquidity For Shareholders Of Privately Held Icontact Case Study Help easily in the present market circumstance.
Posts and telecommunication Press (PTP).
Another close competitor of CMP is PTP. It was likewise founded in the same duration as CMP and CIP. It ranks sixth in the state-owned publishers in regards to service scale. It is likewise among the popular gamers in the publishing market with an annual total incomes of RMB 550 million in 2010.
Alternative-1: Broaden towards New Markets
• Decreasing dependence over the Chinese markets.
• Increasing variety of Consumers
• Development chances.
• Avoiding the impact of market saturation in the Chinese publishing industry.
• Use of possible resources in expansion.
• Threat of failure in new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
• Sustaining consumer base.
• Approaching brand-new markets.
• Easy to present using current capabilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased item portfolio supplies high worth to consumers.
• Competitors in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core company sections to the brand-new one can lead the company to lose need of its products in the market.
With the deep analysis of the external and internal environment of the company along with the industry analysis and the competitor analysis, Alternative 2 is suggested to CMP to achieve its future advancement. As the preferences are moving towards digital publishing and the business need an instant service to avoid the decreasing market development. For that reason, intro of digital publishing could prove to be an immediate solution with low quantity of danger for the company. However, the company could also consider the expansion program after the success of its digital publishing program.
In order to present digital publishing in its item portfolio, the business needs to first collects the information related to the consumer demand, the potential markets, the government policies and the data related to the competitors provided in the market. After that, the company needs to decide one prospective sector for its initial offering. It must collect research that how it could differentiate its digital publishing from the existing rivals' products. After all the actions above the business must opt for the preliminary offering. The company needs to go for the other markets if the initial offering proves a success. In this way the business would be able to implement its digital publishing program.
Although, the growth of the publishing market is declining because 2008, showing a danger to the company's long term existence, however the situation can be controlled by considering an advancement plan in the future. The company could think about introducing digital publishingin its existing market to implement its development program at immediate basis and to avoid the danger of failure for entryway in the brand-new markets.