Strategic Financial Planning In Mining Industry Case Study Solution and Analysis
Intro
Strategic Financial Planning In Mining Industry Case Study Solution is the largest publishing company with a highest market share in the China's book retail market. CMP supplies a variety of services including; gathering information, processing info and communication services. Major service segments of the company consist of; books, regulars, consultancy and distribution. The business has a vast product portfolio and its significant products consist of books, regulars, online media, exhibits, research reports and so on. Strategic Financial Planning In Mining Industry Case Study Solution has actually ended up being a specialized information company and a big thorough Science and Technology publishing business through the integration of print media, audio-visual media and the network media.
Crucial Concerns
Although, Strategic Financial Planning In Mining Industry Case Study Help has invested its 60 years journey efficiently, being a successful publishing house, however, the changing macro market patterns and forces bring specific challenges to the publishing industry in general and CMP in particular. These aspects consist of;
• Entryway of the new publishing firms in the market.
• Declining development of the publishing market.
• Market saturation.
• Intro of digital publishing techniques
• Improvement of science and technology.
The transformation 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 business could be used to pursue the future advancement unceasingly? How could the company sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Strategic Financial Planning In Mining Industry Case Study Solution has particular strengths that can be utilized to lower the hazards, overcome the weakness and avail the opportunities. Strengths of CMP are offered as follows;
• The long term experience of Strategic Financial Planning In Mining Industry Case Study Analysis in the publishing market i.e. 60 years allows the business to supply high quality products at a lower cost utilizing its prior experiences.
• The technical resources and capabilities produced by its effective journey provide a competitive benefit to CMP.
• Vast item portfolioof CMP helps it to diversify its danger and provide high worth to its clients.
• Strong monetary position permits the business to consider several advancement chances without any fear of raising fund externally.
Weak points
In addition to the strengths, the business has particular weaknesses which could increase constraints for the company in executing its development program. The weaknesses of Strategic Financial Planning In Mining Industry Case Study Solution are offered as follows;
• Despite of being a science and technology publishing company, the business still has traditional ways ofpublishing which are not compatible with the growing technological shift.
• CMP highly relies over the Chinese markets for its growth. It should propose certain expansion plans to prevent its dependence over the Chinese markets to accomplish long term development.
Opportunities
The development of the publishing industry is declining given that 2008, affecting Strategic Financial Planning In Mining Industry Case Study Solution as well, however the development could be revived by availing specific opportunities provided in the market. The marketplace chances for CMP include;
• The business might likewise present Digital Publishing by using its long term technical experience and a strong client acknowledgment in the market.
• CMP might consider a development program through the growth towards foreign markets in order to lower its reliance over Chinese markets by utilizing its vast financial resources.
Dangers
The altering macro trends in the market and increasing competitors in the publishing industry has actually presented particular dangers to Strategic Financial Planning In Mining Industry Case Study Help consisting of;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries could lead to declining market share of Strategic Financial Planning In Mining Industry Case Study Help due to the customer shift towards virtual 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 competitors can acquire a strong consumer base by utilizing certain techniques like aggressive promo, quality products, and so on
• Entrance of brand-new publishing companies in the industry together with existence of high competitors increases the hazard of losing the customer base.
Monetary Analysis.
The company has a quite competitive monetary performance. Due to absence of data, the monetary ratios of CMP could not be determined. However, the overall financial performance of the business might be examined by using the graphs given in the case Appendices. It could be evaluated from the Appendix III that the annual overall incomes of CMP throughout the duration 2000-2012 are growing at a high growth rate, showing that the yearly demand of the items of Strategic Financial Planning In Mining Industry Case Study Solution is growing and the business is rather effective in attracting a large number of customers at a possible price.
In addition to it, the 2nd graph which reveals the yearly development in the Strategic Financial Planning In Mining Industry Case Study Help overall properties, shows that the business is quite efficient in adding worth to its properties through its incomes. The growth in possessions shows that the total value of the firm is also increasing with increasing the total revenues. (Unidentified, 2013).
Another financial analysis of the business utilizing the provided data might be the analysis regarding the distribution of overall revenues of the company. Major part of the earnings of CMP originates from the sales of its published books i.e. 64% as shown in the Case Appendix V. The company might move towards other service sections with a potential growth to achieve its future advancement objective.
PESTEL Analysis
PESTEL analysis might be performed to find out the various external forces impacting the efficiency of the business and the recent trends in the external environment of the business. A short PESTEL analysis of the business is provided as follows; (Alanzi, 2018).
Political.
As the publishing sector could have a significant influence on the state of mind of the people about the communist ideology of the federal government, therefore, the publishing sector is extremely supervised and guided by the Promotion Department of the Communist Party of China. Therefore, it could be said that the total political forces affecting Strategic Financial Planning In Mining Industry Case Study Analysis company are high. The government policies concerning the publishing sector are also increasing with the passage of time.
Affordable.
Financial forces impacting 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 country. All these forces integrate effect the need for the publishing market.
Social and Demographical.
Social and demographical forces consist of the population development, the customer's preferences towards reading helpful products and so on. China has the greatest population on the planet with a high population growth, showing the increasing number of customers of the Strategic Financial Planning In Mining Industry Case Study Solution. The consumer preferences are moving towards digital publishing rather than the standard was of publishing. In this regard, CMP ought to focus on digital publishing to fulfill the changing consumer preferences.
Technological.
Technological forces affecting the CMP include the technological advancement in the reading strategies etc. Improvement of science and innovation together with the rise of digital publishing might lower the need for the CMP products, if particular actions would not be taken soon.
Environmental.
Environmental forces affecting Strategic Financial Planning In Mining Industry Case Study Analysis consists of the concerns of ecological communities over the use of paper in publishing books. The paper used in the books while publishing is required to be disposable and the ink utilized while publishing ought to not be harmful for the environment.
Legal.
Legal regulations for the publishing sector at whole are high. Publishing Ordinance 1997 needs the publishers to be authorized first by the Government to be gone into in the publishing market.
Industry Analysis (Porter's 5 Forces Model).
Porter's Five Forces Model could be utilized to evaluate the appearance of the publishing industry China. A brief analysis of the Porter's 5 Forces is offered as follows;.
Threat of New Entrants.
Hazards of brand-new entrants in the Chinese Publishing Industry is moderate. The prospective growth in the market tends to draw in new entrants to the publishing market. The existence of extreme competitors and the requirement of big capital tends to demotivate new entrants to enter in the market.
Hazard of Alternative.
Hazard of Replacement is high for the Chinese Publishing Market. The alternative items for the published documents is the documents presented in the virtual libraries on specific sites. The changing consumer choices towards digital knowing increase the danger of replacement for the industry.
Competitive Competition.
Competitive competition in the publishing industry is high. The presence of a great deal of consumers in the Chinese Publishing Market like CIP, PTP etc. tends to produce high competitive rivalry for CMP. In addition to it, brand-new entrants are likewise participating in the marketplace increasing the competition for CMP.
Bargaining Power of Supplier.
The major suppliers of the Strategic Financial Planning In Mining Industry Case Study Solution include the suppliers of the paper for publishing documents. As CMP is the largest publisher in the Chinese Publishing Market, for that reason the overall bargaining power of provider for CMP is low.
Bargaining Power of Purchaser.
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 files at competitive rates.
Rivals Analysis.
CMP runs in a highly competitive industry with the presence of large number of competitors. However, the business has a competitive position in the market with the greatest market share in the Chinese publishing market. Major competitors of Strategic Financial Planning In Mining Industry Case Study Solution consist of;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIP acts as a risk 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 CMP quickly in the existing market scenario.
Posts and telecommunication Press (PTP).
It was also established in the exact same period as Strategic Financial Planning In Mining Industry Case Study Solution and CIP. It is likewise one of the popular players in the publishing market with a yearly overall earnings of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Reducing dependence over the Chinese markets.
• Increasing number of Clients
• Development chances.
• Preventing the effect of market saturation in the Chinese publishing market.
Cons
• Use of possible resources in expansion.
• Risk of failure in brand-new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining consumer base.
• Approaching brand-new markets.
• Easy to present utilizing existing abilities.
• Low risk of Failure.
• Low requirement for funds.
• Increased product portfolio supplies high worth to clients.
Cons
• Competition in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core company sectors to the new one can lead the company to lose demand of its products in the market.
Suggestions
With the deep analysis of the external and internal environment of the business along with the market analysis and the competitor analysis, Alternative 2 is recommended to CMP to accomplish its future advancement. As the choices are shifting towards digital publishing and the company require an immediate service to avoid the declining industry development. Introduction of digital publishing might prove to be an instant service with low quantity of danger for the business. Nevertheless, the business might likewise think about the expansion program after the success of its digital publishing program.
Implementation
In order to present digital publishing in its item portfolio, the business ought to first collects the data related to the consumer demand, the potential markets, the government policies and the data related to the rivals provided in the market. If the preliminary offering shows a success, the business ought to go for the other markets. In this method the business would be able to implement its digital publishing program.
Conclusion
The development of the publishing industry is decreasing because 2008, revealing a danger to the business's long term existence, but the scenario can be controlled by considering an advancement plan in the future. The company might think about 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 new markets.
