South West Airline Company Case Study Solution and Analysis
Intro
South West Airline Company Case Study Solution is the largest publishing business with a highest market share in the China's book retail market. CMP has become a specialized info service provider and a big extensive Science and Technology publishing business through the integration of print media, audio-visual media and the network media.
Crucial Concerns
Although, South West Airline Company Case Study Solution has actually invested its 60 years journey efficiently, being a successful publishing home, nevertheless, the changing macro market trends and forces bring particular challenges to the publishing market in basic and CMP in particular. These aspects consist of;
• Entryway of the brand-new publishing firms in the market.
• Declining development of the publishing market.
• Market saturation.
• Intro of digital publishing methods
• Improvement of science and technology.
The change of the macro markets have raised numerous concerns 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 abilities of the company could be made use of to strive for the future advancement unceasingly? How could the business sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
South West Airline Company Case Study Solution has specific strengths that can be used to lower the hazards, conquer the weak point and get the chances. Strengths of CMP are given as follows;
• The long term experience of South West Airline Company Case Study Help in the publishing industry i.e. 60 years allows the company to provide high quality products at a lower cost utilizing its prior experiences.
• The technical resources and capabilities created by its successful journey supply a competitive advantage to CMP.
• Vast item portfolioof CMP helps it to diversify its risk and offer high value to its consumers.
• Strong monetary position permits the business to think about numerous development chances with no worry of raising fund externally.
Weak points
Along with the strengths, the company has particular weak points which could increase restrictions for the business in executing its development program. The weaknesses of South West Airline Company Case Study Analysis are offered as follows;
• Despite of being a science and technology publishing firm, the business still has traditional ways ofpublishing which are not compatible with the growing technological shift.
• CMP extremely relies over the Chinese markets for its growth. It should propose particular expansion plans to avoid its dependence over the Chinese markets to achieve long term development.
Opportunities
Although, the development of the publishing industry is decreasing since 2008, affecting South West Airline Company Case Study Help also, however the growth could be revived by availing certain opportunities presented in the market. The market chances for CMP consist of;
• The business might also introduce Digital Publishing by utilizing its long term technical experience and a strong consumer acknowledgment in the market.
• CMP could consider an advancement program through the growth towards foreign markets in order to lower its reliance over Chinese markets by utilizing its huge funds.
Hazards
The changing macro patterns in the market and increasing competitors in the publishing market has actually posed specific threats to South West Airline Company Case Study Help including;( Gurel, 2017).
• Intro of digital publishing i.e. virtual libraries could lead to declining market share of South West Airline Company Case Study Help due to the consumer shift towards virtual libraries.
• The existence of large number of rivals in the publishing industry increase the threat for CMP to lose its competitive position in the market, as competitors can gain a strong consumer base by utilizing certain methods like aggressive promotion, quality items, and so on
• Entryway of new publishing firms in the market along with existence of high competitors increases the risk of losing the customer base.
Monetary Analysis.
The business has a rather competitive financial performance. Due to absence of data, the financial ratios of CMP could not be determined. Nevertheless, the overall monetary efficiency of the company could be evaluated by using the charts given in the case Appendices. It might be examined from the Appendix III that the annual overall earnings of CMP throughout the duration 2000-2012 are growing at a high development rate, showing that the yearly need of the products of South West Airline Company Case Study Analysis is growing and the company is quite effective in bring in a a great deal of customers at a potential price.
Along with it, the second chart which shows the annual growth in the South West Airline Company Case Study Help overall properties, reveals that the company is rather effective in including worth to its assets through its earnings. The growth in assets reveals that the total worth of the company is likewise increasing with increasing the total incomes. (Unidentified, 2013).
Another financial analysis of the business utilizing the offered data might be the analysis concerning the distribution of total earnings of the company. Major part of the incomes of CMP comes from the sales of its released books i.e. 64% as shown in the Case Appendix V. The business could move towards other business segments with a potential development to accomplish its future advancement objective.
PESTEL Analysis
PESTEL analysis might be conducted to learn the different external forces affecting the performance of the business and the recent patterns in the external environment of the business. A brief PESTEL analysis of the business is offered as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a considerable effect on the state of mind of individuals about the communist ideology of the federal government, for that reason, the publishing sector is highly monitored and directed by the Promotion Department of the Communist Party of China. Therefore, it might be stated that the total political forces affecting South West Airline Company Case Study Solution organisation are high. The federal government policies regarding the publishing sector are also increasing with the passage of time.
Cost-effective.
Financial forces impacting the publishing sector in basic and the South West Airline Company Case Study Help in specific includesthe rates of paper, the earnings level of customers, the inflation rate, and the overall GDP growth of the country. All these forces integrate effect the need for the publishing market. Together with it, the economic policies connected to the import of books affect the general business at CPM. China's financial conditions are rather favorable for CMP with high GDP growth and consumer income level.
Social and Demographical.
Social and demographical forces include the population growth, the customer's preferences towards checking out informative products etc. China has the highest population in the world with a high population development, showing the increasing number of customers of the South West Airline Company Case Study Analysis. Nevertheless, the consumer choices are shifting towards digital publishing rather than the traditional was of publishing. In this regard, CMP needs to focus on digital publishing to meet the altering consumer preferences.
Technological.
Technological forces affecting the CMP consist of the technological development in the reading methods and so on. Improvement of science and technology in addition to the increase of digital publishing might minimize the need for the CMP items, if certain actions would not be taken soon.
Environmental.
Environmental forces impacting South West Airline Company Case Study Help consists of the issues of environmental communities over the use of paper in publishing books. The paper utilized in the books while publishing is needed to be disposable and the ink utilized while publishing ought to not be hazardous for the environment.
Legal.
Legal guidelines 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 Ordinance 1997 needs the publishers to be approved initially by the Federal government to be entered in the publishing market. The ordinance prohibits direct involvement of foreign entities and people in the publishing sector.
Industry Analysis (Porter's 5 Forces Design).
Porter's Five Forces Model could be utilized to evaluate the beauty of the publishing industry China. A brief analysis of the Porter's Five Forces is given as follows;.
Hazard of New Entrants.
Hazards of new entrants in the Chinese Publishing Industry is moderate. The potential development in the industry tends to draw in new entrants to the publishing industry. Nevertheless, the existence of extreme competitors and the requirement of substantial capital tends to demotivate brand-new entrants to go into in the market.
Risk of Replacement.
Danger of Substitution is high for the Chinese Publishing Market. The replacement products for the released files is the files provided in the digital libraries on specific websites. The changing consumer preferences towards digital knowing increase the hazard of replacement for the industry.
Competitive Competition.
Competitive rivalry in the publishing industry is high. The existence of large number of customers in the Chinese Publishing Industry like CIP, PTP and so on tends to produce high competitive competition for CMP. In addition to it, new entrants are also entering into the market increasing the competition for CMP.
Bargaining Power of Provider.
The significant providers of the South West Airline Company Case Study Help consist of the providers of the paper for publishing documents. As CMP is the largest publisher in the Chinese Publishing Market, therefore the overall bargaining power of provider for CMP is low.
Bargaining Power of Buyer.
Negotiating power of purchaser in the publishing market is high. Due to the presence of a large number of publishers in the Chinese market and the marketplace saturation, the purchasers needs high quality files at competitive rates.
Rivals Analysis.
CMP operates in an extremely competitive market with the presence of large number of rivals. The business has a competitive position in the market with the greatest market share in the Chinese publishing market. Major competitors of South West Airline Company Case Study Help consist of;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIP acts as a threat 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 market share of CMP easily in the present market situation.
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 sixth in the state-owned publishers in terms of company scale. It is also one of the popular players in the publishing market with an annual total revenues of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Minimizing dependence over the Chinese markets.
• Increasing variety of Consumers
• Development chances.
• Avoiding the effect of market saturation in the Chinese publishing industry.
Cons
• Usage of prospective resources in expansion.
• Risk of failure in new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining customer base.
• Approaching new markets.
• Easy to present using current capabilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased product portfolio supplies 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 segments to the brand-new one can lead the company to lose need of its items in the market.
Recommendations
With the deep analysis of the internal and external environment of the company along with the market analysis and the rival analysis, Alternative 2 is recommended to CMP to accomplish its future development. As the preferences are moving towards digital publishing and the business need an instant solution to avoid the declining market development. For that reason, introduction of digital publishing might prove to be an immediate option with low amount of threat for the company. However, the business could likewise think about the growth program after the success of its digital publishing program.
Application
In order to introduce digital publishing in its item portfolio, the business ought to first collects the information related to the customer demand, the possible markets, the federal government policies and the information related to the competitors presented in the market. If the initial offering proves a success, the business needs to go for the other markets. In this method the business would be able to implement its digital publishing program.
Conclusion
Although, the growth of the publishing market is decreasing given that 2008, showing a threat to the company's long term presence, but the circumstance can be managed by thinking about an advancement plan in the future. The company could consider introducing digital publishingin its existing market to execute its development program at immediate basis and to avoid the risk of failure for entrance in the brand-new markets.
