Shanghai Zhangjiang Hi Tech Park Development Co Ltd Case Study Solution and Analysis
Intro
Shanghai Zhangjiang Hi Tech Park Development Co Ltd Case Study Analysis is the biggest publishing company with a highest market share in the China's book retail market. CMP offers a variety of services including; gathering details, processing details and communication services. Significant company sections of the company include; books, regulars, consultancy and circulation. The business has a huge item portfolio and its significant products include books, periodicals, online media, exhibitions, research study reports etc. Shanghai Zhangjiang Hi Tech Park Development Co Ltd Case Study Solution has become a specialized details service provider and a big detailed Science and Innovation publishing company through the integration of print media, audio-visual media and the network media.
Vital Concerns
Although, Shanghai Zhangjiang Hi Tech Park Development Co Ltd Case Study Help has actually spent its 60 years journey smoothly, being an effective publishing house, nevertheless, the changing macro market patterns and forces bring particular obstacles to the publishing industry in basic and CMP in specific. These elements consist of;
• Entrance of the brand-new publishing firms in the industry.
• Declining development of the publishing market.
• Market saturation.
• Intro of digital publishing methods
• Improvement of science and innovation.
The change 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 business could be used to strive for the future advancement unceasingly? How could the company sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Shanghai Zhangjiang Hi Tech Park Development Co Ltd Case Study Solution has particular strengths that can be utilized to minimize the risks, conquer the weak point and obtain the opportunities. Strengths of CMP are provided as follows;
• The long term experience of Shanghai Zhangjiang Hi Tech Park Development Co Ltd Case Study Analysis in the publishing market i.e. 60 years permits the business to provide high quality products at a lower expense using its prior experiences.
• The technical resources and capabilities generated by its successful journey provide a competitive advantage to CMP.
• Vast item portfolioof CMP assists it to diversify its danger and offer high worth to its consumers.
• Strong monetary position allows the business to think about a number of development chances with no worry of raising fund externally.
Weaknesses
Together with the strengths, the business has certain weaknesses which might increase restraints for the business in implementing its development program. The weak points of Shanghai Zhangjiang Hi Tech Park Development Co Ltd Case Study Help are given as follows;
• Despite of being a science and technology publishing firm, the company still has traditional ways ofpublishing which are not suitable with the growing technological shift.
• CMP highly relies over the Chinese markets for its growth. It needs to propose specific expansion plans to avoid its reliance over the Chinese markets to attain long term development.
Opportunities
The development of the publishing industry is decreasing since 2008, affecting Shanghai Zhangjiang Hi Tech Park Development Co Ltd Case Study Help as well, but the development might be restored by availing particular opportunities presented in the market. The market opportunities for CMP include;
• The business could likewise present Digital Publishing by using 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 lower its reliance over Chinese markets by using its large financial resources.
Dangers
The changing macro trends in the market and increasing competitors in the publishing industry has actually posed particular risks to Shanghai Zhangjiang Hi Tech Park Development Co Ltd Case Study Help including;( Gurel, 2017).
• Intro of digital publishing i.e. virtual libraries might cause decreasing market share of Shanghai Zhangjiang Hi Tech Park Development Co Ltd Case Study Solution due to the consumer shift towards digital libraries.
• The existence of a great deal of rivals in the publishing market increase the threat for CMP to lose its competitive position in the market, as rivals can get a strong customer base by utilizing particular methods like aggressive promotion, quality products, etc.
• Entrance of new publishing companies in the market together with presence of high competition increases the threat of losing the consumer base.
Financial Analysis.
The company has a quite competitive monetary efficiency. Due to absence of information, the monetary ratios of CMP could not be computed. Nevertheless, the total financial efficiency of the business might be examined by using the graphs given in the case Appendices. It might be analyzed from the Appendix III that the annual total revenues of CMP during the period 2000-2012 are growing at a high growth rate, revealing that the yearly demand of the items of Shanghai Zhangjiang Hi Tech Park Development Co Ltd Case Study Help is growing and the business is rather effective in drawing in a a great deal of consumers at a prospective price.
Together with it, the second chart which shows the annual growth in the Shanghai Zhangjiang Hi Tech Park Development Co Ltd Case Study Help total properties, shows that the business is quite effective in including value to its properties through its incomes. The growth in possessions reveals that the total value of the company is likewise increasing with increasing the total revenues. (Unidentified, 2013).
Another monetary analysis of the business using the given data might be the analysis regarding the circulation of total incomes of the company. Huge part of the earnings of CMP comes from the sales of its released books i.e. 64% as shown in the Case Appendix V. The company might move towards other business sections with a potential growth to accomplish its future advancement objective.
PESTEL Analysis
PESTEL analysis could be carried out to find out the various external forces impacting the efficiency of the business and the current trends in the external environment of the business. A brief PESTEL analysis of the business is given as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a considerable influence on the mindset of the people about the communist ideology of the federal government, for that reason, the publishing sector is extremely supervised and directed by the Publicity Department of the Communist Celebration of China. For that reason, it could be said that the overall political forces impacting Shanghai Zhangjiang Hi Tech Park Development Co Ltd Case Study Help business are high. The government policies relating to the publishing sector are also increasing with the passage of time.
Affordable.
Economic forces affecting the publishing sector in basic and the Shanghai Zhangjiang Hi Tech Park Development Co Ltd Case Study Analysis in specific includesthe rates of paper, the earnings level of customers, the inflation rate, and the total GDP growth of the nation. All these forces integrate effect the need for the publishing market. In addition to it, the financial policies connected to the import of books affect the total service at CPM. Nevertheless, China's financial conditions are quite favorable for CMP with high GDP growth and customer income level.
Social and Demographical.
Social and demographical forces consist of the population development, the consumer's preferences towards reading useful products and so on. China has the greatest population worldwide with a high population growth, revealing the increasing variety of consumers of the Shanghai Zhangjiang Hi Tech Park Development Co Ltd Case Study Help. The consumer preferences are shifting towards digital publishing rather than the conventional was of publishing. In this regard, CMP ought to focus on digital publishing to satisfy the altering consumer preferences.
Technological.
Technological forces affecting the CMP consist of the technological development in the reading methods etc. Improvement of science and technology along with the rise of digital publishing could lower the need for the CMP products, if specific actions would not be taken quickly.
Environmental.
Ecological forces impacting Shanghai Zhangjiang Hi Tech Park Development Co Ltd Case Study Help includes the issues 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.
Legal policies for the publishing sector at whole are high. Publishing Ordinance 1997 requires the publishers to be authorized initially by the Federal government to be entered in the publishing market.
Market Analysis (Porter's Five Forces Model).
Porter's 5 Forces Design might be utilized to evaluate the beauty of the publishing industry China. A quick analysis of the Porter's 5 Forces is offered as follows;.
Danger of New Entrants.
Threats of new entrants in the Chinese Publishing Market is moderate. The possible development in the industry tends to draw in new entrants to the publishing market. The presence of intense competition and the requirement of huge capital tends to demotivate new entrants to go into in the market.
Threat of Substitution.
Hazard of Replacement is high for the Chinese Publishing Market. The replacement items for the released files is the documents presented in the digital libraries on particular sites. The changing consumer preferences towards digital learning increase the risk of substitution for the industry.
Competitive Rivalry.
Competitive competition in the publishing industry is high. The existence of a great deal of consumers in the Chinese Publishing Market like CIP, PTP and so on tends to produce high competitive competition for CMP. In addition to it, new entrants are also participating in the marketplace increasing the competitors for CMP.
Bargaining Power of Provider.
The major providers of the Shanghai Zhangjiang Hi Tech Park Development Co Ltd 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 Buyer.
Haggling power of purchaser in the publishing industry is high. Due to the existence of a a great deal of publishers in the Chinese market and the marketplace saturation, the buyers requires high quality documents at competitive costs.
Rivals Analysis.
CMP runs in a highly competitive industry with the presence of a great deal 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 Shanghai Zhangjiang Hi Tech Park Development Co Ltd Case Study Analysis include;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIPis one of the close competitors of CMP. Established in the same period, CIP releases similar kind of books. For a large time period, CIP held the largest market share, and still ranks 3rd and 2nd in various market sectors, with a major concentrate on academic publications. CIP serves as a danger 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 Shanghai Zhangjiang Hi Tech Park Development Co Ltd Case Study Solution easily in the current market scenario.
Posts and telecommunication Press (PTP).
Another close competitor of CMP is PTP. It was likewise established in the very same duration as CMP and CIP. It ranks sixth in the state-owned publishers in regards to service scale. It is also one of the prominent gamers in the publishing market with a yearly total profits of RMB 550 million in 2010.
Alternatives
Alternative-1: Expand towards New Markets
Pros
• Decreasing dependence over the Chinese markets.
• Increasing variety of Clients
• Development chances.
• Preventing the impact of market saturation in the Chinese publishing market.
Cons
• Usage of potential resources in growth.
• Risk of failure in new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining customer base.
• Approaching brand-new markets.
• Easy to introduce using present capabilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased product portfolio offers high value to customers.
Cons
• Competition in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core organisation segments to the brand-new one can lead the business to lose need of its products in the market.
Suggestions
As the preferences are moving towards digital publishing and the company require an immediate option to prevent the declining market growth. The business might likewise consider the growth program after the success of its digital publishing program.
Execution
In order to introduce digital publishing in its item portfolio, the business should initially collects the information related to the consumer need, the prospective markets, the federal government guidelines and the data related to the competitors presented in the market. After that, the business needs to choose one potential sector for its initial offering. It should gather research that how it could differentiate its digital publishing from the existing rivals' products. After all the actions above the company should choose the preliminary offering. If the initial offering proves a success, the business ought to opt for the other markets. In this way the business would be able to implement its digital publishing program.
Conclusion
Although, the development of the publishing industry is decreasing given that 2008, revealing a hazard to the business's long term presence, however the circumstance can be controlled by thinking about a development strategy in the future. The company might consider introducing digital publishingin its existing market to implement its development program at instant basis and to prevent the danger of failure for entryway in the new markets.
