Stratafin Inc Auditing Change Case Study Solution and Analysis
Stratafin Inc Auditing Change Case Study Solution is the largest publishing company with a highest market share in the China's book retail market. CMP has actually ended up being a specialized info provider and a large comprehensive Science and Technology publishing business through the combination of print media, audio-visual media and the network media.
CMP has actually invested its 60 years journey efficiently, being an effective publishing house, nevertheless, the changing macro market patterns and forces bring specific challenges to the publishing market in basic and Stratafin Inc Auditing Change Case Study Analysis in particular. These elements consist of;
• Entrance of the new publishing firms in the market.
• Decreasing development of the publishing market.
• Market saturation.
• Intro of digital publishing techniques
• Enhancement of science and innovation.
The change of the macro markets have raised a number of concerns to the management at CPM that what could be the future of CMP in this scenario? Do the long valuable experience, technical resources and the abilities of the company could be utilized to strive for the future development unceasingly? How could the business sustain its long term competitive position in future?
Stratafin Inc Auditing Change Case Study Analysis has specific strengths that can be used to reduce the hazards, overcome the weakness and obtain the opportunities. Strengths of CMP are provided as follows;
• The long term experience of Stratafin Inc Auditing Change Case Study Analysis in the publishing market i.e. 60 years enables the company to supply high quality products at a lower cost utilizing its previous experiences.
• The technical resources and capabilities generated by its successful journey supply a competitive advantage to CMP.
• Huge item portfolioof CMP assists it to diversify its risk and offer high value to its clients.
• Strong financial position permits the business to consider a number of advancement opportunities without any worry of raising fund externally.
Along with the strengths, the business has certain weaknesses which could increase restrictions for the business in executing its advancement program. The weak points of Stratafin Inc Auditing Change Case Study Help are given as follows;
• Despite of being a science and technology publishing firm, the business still has conventional methods ofpublishing which are not compatible with the growing technological shift.
• CMP highly relies over the Chinese markets for its growth. It must propose certain expansion plans to avoid its dependence over the Chinese markets to achieve long term development.
The development of the publishing market is declining because 2008, impacting Stratafin Inc Auditing Change Case Study Analysis as well, but the development might be restored by availing particular opportunities presented in the market. The marketplace chances for CMP consist of;
• The business might likewise introduce Digital Publishing by utilizing its long term technical experience and a strong consumer acknowledgment in the market.
• CMP could think about a development program through the expansion towards foreign markets in order to minimize its reliance over Chinese markets by using its huge funds.
The changing macro trends in the market and increasing competitors in the publishing industry has postured specific threats to Stratafin Inc Auditing Change Case Study Analysis consisting of;( Gurel, 2017).
• Introduction of digital publishing i.e. virtual libraries could result in declining market share of Stratafin Inc Auditing Change Case Study Analysis due to the customer shift towards virtual libraries.
• The existence of a great deal of rivals in the publishing industry increase the hazard for CMP to lose its competitive position in the market, as competitors can get a strong consumer base by using certain techniques like aggressive promo, quality items, etc.
• Entrance of new publishing companies in the market in addition to presence of high competitors increases the risk of losing the customer base.
The company has a quite competitive monetary performance. Due to absence of information, the monetary ratios of CMP could not be determined. Nevertheless, the overall monetary performance of the company might be analyzed by utilizing the charts given up the case Appendices. It could be analyzed from the Appendix III that the yearly total revenues of CMP throughout the period 2000-2012 are growing at a high development rate, showing that the yearly need of the items of Stratafin Inc Auditing Change Case Study Solution is growing and the company is quite effective in drawing in a large number of customers at a prospective price.
Along with it, the 2nd chart which shows the yearly development in the Stratafin Inc Auditing Change Case Study Analysis total properties, shows that the company is rather effective in adding worth to its possessions through its earnings. The development in properties shows that the total worth of the firm is also increasing with increasing the overall incomes. (Unknown, 2013).
Another monetary analysis of the company using the provided data might be the analysis regarding the circulation of overall earnings of the business. Huge part of the revenues of CMP originates from the sales of its published books i.e. 64% as displayed in the Case Appendix V. The business could move towards other service sectors with a possible development to attain its future development goal.
PESTEL analysis might be carried out to find out the different external forces impacting the performance of the business and the recent trends in the external environment of the company. A short PESTEL analysis of the business is provided as follows; (Alanzi, 2018).
As the publishing sector could have a considerable influence on the state of mind of the people about the communist ideology of the government, for that reason, the publishing sector is extremely monitored and directed by the Publicity Department of the Communist Party of China. For that reason, it might be stated that the overall political forces impacting Stratafin Inc Auditing Change Case Study Help business are high. The government policies regarding the publishing sector are also increasing with the passage of time.
Financial forces impacting the publishing sector in basic and the Stratafin Inc Auditing Change Case Study Analysis in specific includesthe costs of paper, the income level of customers, the inflation rate, and the overall GDP growth of the country. All these forces combine effect the demand for the publishing market. In addition to it, the economic policies related to the import of books impact the total service at CPM. Nevertheless, China's financial conditions are rather favorable for CMP with high GDP development and customer income level.
Social and Demographical.
Social and demographical forces consist of the population growth, the consumer's preferences towards reading helpful products etc. China has the highest population on the planet with a high population growth, revealing the increasing variety of customers of the Stratafin Inc Auditing Change Case Study Solution. Nevertheless, the consumer preferences are moving towards digital publishing rather than the traditional was of publishing. In this regard, CMP should concentrate on digital publishing to meet the altering customer preferences.
Technological forces impacting the CMP consist of the technological advancement in the reading methods etc. Enhancement of science and innovation along with the rise of digital publishing might lower the need for the CMP products, if particular actions would not be taken soon.
Ecological forces affecting Stratafin Inc Auditing Change Case Study Solution includes the issues of environmental communities over the usage of paper in publishing books. The paper used in the books while publishing is needed to be disposable and the ink utilized while publishing must not be harmful for the environment.
Legal policies 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 needs the publishers to be authorized initially by the Government to be gone into in the publishing market. The ordinance forbids direct involvement of foreign entities and people in the publishing sector.
Industry Analysis (Porter's 5 Forces Design).
Porter's 5 Forces Design could be utilized to examine the attractiveness of the publishing industry China. A brief analysis of the Porter's Five Forces is offered as follows;.
Threat of New Entrants.
Hazards of new entrants in the Chinese Publishing Industry is moderate. The potential growth in the industry tends to draw in new entrants to the publishing industry. The presence of extreme competition and the requirement of substantial capital tends to demotivate brand-new entrants to go into in the market.
Hazard of Replacement.
Threat of Alternative is high for the Chinese Publishing Industry. The alternative items for the published files is the files presented in the digital libraries on particular websites. The changing customer preferences towards digital learning increase the danger 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 Industry like CIP, PTP etc. tends to produce high competitive competition for CMP. Together with it, new entrants are likewise participating in the market increasing the competitors for CMP.
Bargaining Power of Supplier.
The major providers of the Stratafin Inc Auditing Change Case Study Solution include the suppliers of the paper for releasing documents. As CMP is the largest publisher in the Chinese Publishing Market, therefore the general bargaining power of supplier for CMP is low.
Bargaining Power of Purchaser.
Bargaining 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 purchasers requires high quality files at competitive costs.
CMP operates in a highly competitive industry with the existence of a great deal of rivals. However, the business has a competitive position in the market with the highest market share in the Chinese publishing market. Significant competitors of Stratafin Inc Auditing Change Case Study Analysis include;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry 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 existing market scenario.
Posts and telecommunication Press (PTP).
Another close rival 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 terms of organisation scale. It is also one of the prominent players in the publishing industry with a yearly overall profits of RMB 550 million in 2010.
Alternative-1: Expand towards New Markets
• Lowering reliance over the Chinese markets.
• Increasing number of Consumers
• Development opportunities.
• Avoiding the impact of market saturation in the Chinese publishing market.
• Use of possible resources in growth.
• Danger of failure in brand-new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
• Sustaining consumer base.
• Approaching new markets.
• Easy to introduce utilizing present capabilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased product portfolio supplies high value to customers.
• Competitors in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core service sectors to the new one can lead the company to lose demand of its products in the market.
With the deep analysis of the internal and external environment of the company in addition to the industry analysis and the rival analysis, Alternative 2 is advised to CMP to attain its future advancement. As the preferences are shifting towards digital publishing and the business require an instant solution to avoid the declining industry development. For that reason, intro of digital publishing might show to be an instant option with low amount of threat for the business. Nevertheless, the company could also think about the expansion program after the success of its digital publishing program.
In order to present digital publishing in its product portfolio, the company ought to first collects the data related to the consumer demand, the prospective markets, the federal government policies and the data related to the competitors presented in the market. If the initial offering shows a success, the company should go for the other markets. In this way the business would be able to execute its digital publishing program.
The growth of the publishing industry is declining considering that 2008, revealing a danger to the company's long term presence, but the situation can be managed by considering an advancement strategy in the future. The business could consider introducing digital publishingin its existing market to implement its advancement program at immediate basis and to prevent the threat of failure for entryway in the brand-new markets.