Strategy And Competition Case Study Solution and Analysis
Intro
Strategy And Competition Case Study Analysis is the biggest publishing company with a highest market share in the China's book retail market. CMP has actually become a specialized information supplier and a large detailed Science and Technology publishing company through the combination of print media, audio-visual media and the network media.
Vital Concerns
Although, Strategy And Competition Case Study Solution has invested its 60 years journey efficiently, being an effective publishing home, nevertheless, the changing macro market trends and forces bring specific difficulties to the publishing market in basic and CMP in specific. These elements include;
• Entryway of the new publishing companies in the industry.
• Decreasing growth of the publishing market.
• Market saturation.
• Intro of digital publishing methods
• Improvement of science and innovation.
The improvement of the macro markets have raised several concerns to the management at CPM that what could be the future of CMP in this scenario? Do the long important experience, technical resources and the abilities of the company could be made use of to pursue the future development unceasingly? How could the business sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Strategy And Competition Case Study Analysis has certain strengths that can be utilized to decrease the threats, get rid of the weak point and obtain the chances. Strengths of CMP are offered as follows;
• The long term experience of Strategy And Competition Case Study Analysis in the publishing market i.e. 60 years permits the company to offer high quality products at a lower expense using its previous experiences.
• The technical resources and abilities created by its successful journey provide a competitive benefit to CMP.
• Vast product portfolioof CMP assists it to diversify its threat and provide high worth to its customers.
• Strong monetary position allows the business to consider a number of advancement opportunities with no fear of raising fund externally.
Weaknesses
Together with the strengths, the company has certain weaknesses which might increase constraints for the business in implementing its advancement program. The weak points of Strategy And Competition Case Study Analysis are given as follows;
• Despite of being a science and innovation publishing company, the business still has traditional ways ofpublishing which are not suitable with the growing technological shift.
• CMP highly relies over the Chinese markets for its development. It must propose particular expansion strategies to prevent its reliance over the Chinese markets to accomplish long term development.
Opportunities
The growth of the publishing industry is decreasing given that 2008, affecting Strategy And Competition Case Study Solution as well, but the development could be revived by availing certain opportunities presented in the market. The market opportunities for CMP include;
• The company might likewise introduce Digital Publishing by using its long term technical experience and a strong client acknowledgment in the market.
• CMP might think about an advancement program through the growth towards foreign markets in order to minimize its dependence over Chinese markets by utilizing its huge funds.
Hazards
The changing macro patterns in the market and increasing competition in the publishing market has actually postured specific hazards to Strategy And Competition Case Study Analysis including;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries could lead to declining market share of Strategy And Competition Case Study Solution due to the consumer shift towards virtual libraries.
• The existence of large number 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 particular techniques like aggressive promotion, quality products, etc.
• Entrance of new publishing companies in the industry together with presence of high competition increases the threat 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 computed. Nevertheless, the overall monetary efficiency of the company could be evaluated by using the charts given in the case Appendices. It might be analyzed from the Appendix III that the yearly overall profits of CMP during the period 2000-2012 are growing at a high development rate, revealing that the yearly need of the items of Strategy And Competition Case Study Analysis is growing and the business is quite efficient in bring in a large number of clients at a possible price.
In addition to it, the 2nd graph which reveals the annual development in the Strategy And Competition Case Study Analysis total possessions, shows that the business is rather effective in including worth to its assets through its incomes. The growth in properties shows that the total value of the firm is also increasing with increasing the total incomes. (Unknown, 2013).
Another financial analysis of the business utilizing the offered data might be the analysis relating to the circulation of total incomes of the company. Major part of the revenues of CMP comes from the sales of its released books i.e. 64% as displayed in the Case Appendix V. The business might move towards other service segments with a prospective growth to attain its future advancement objective.
PESTEL Analysis
PESTEL analysis could be performed to discover the numerous external forces impacting the performance of the company and the recent patterns in the external environment of the business. A short PESTEL analysis of the company is provided as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a significant influence on the state of mind of the people about the communist ideology of the federal government, for that reason, the publishing sector is highly supervised and directed by the Publicity Department of the Communist Celebration of China. For that reason, it might be stated that the general political forces impacting Strategy And Competition Case Study Analysis service are high. The government policies relating to the publishing sector are also increasing with the passage of time.
Affordable.
Financial forces impacting the publishing sector in basic and the Strategy And Competition Case Study Help in particular includesthe costs of paper, the income level of consumers, the inflation rate, and the general GDP development of the nation. All these forces integrate effect the demand for the publishing market. Together with it, the economic policies associated with the import of books affect the overall organisation at CPM. China's financial conditions are quite favorable for CMP with high GDP development and consumer income level.
Social and Demographical.
The consumer choices are shifting towards digital publishing rather than the conventional was of publishing. In this regard, CMP needs to focus on digital publishing to fulfill the changing customer choices.
Technological.
Technological forces affecting the CMP consist of the technological advancement in the reading methods and so on. Enhancement of science and innovation together with the increase of digital publishing could reduce the need for the CMP products, if specific actions would not be taken soon.
Environmental.
Ecological forces affecting Strategy And Competition Case Study Solution consists of the issues of ecological communities over the usage of paper in publishing books. The paper utilized in the books while publishing is needed to be non reusable and the ink used while publishing should not be damaging for the environment.
Legal.
Legal policies for the publishing sector at whole are high. Publishing Regulation 1997 needs the publishers to be authorized initially by the Government to be entered in the publishing market.
Market Analysis (Porter's 5 Forces Design).
Porter's Five Forces Design might be utilized to analyze the attractiveness of the publishing market China. A short analysis of the Porter's Five Forces is given as follows;.
Threat of New Entrants.
Hazards of brand-new entrants in the Chinese Publishing Market is moderate. The possible growth in the industry tends to attract new entrants to the publishing market. The presence of intense competition and the requirement of huge capital tends to demotivate brand-new entrants to enter in the market.
Threat of Replacement.
Threat of Replacement is high for the Chinese Publishing Industry. The substitute items for the published files is the documents presented in the digital libraries on specific sites. The changing consumer preferences towards digital knowing increase the hazard of replacement for the market.
Competitive Competition.
Competitive rivalry in the publishing market is high. The existence of a great deal of customers in the Chinese Publishing Industry like CIP, PTP and so on tends to produce high competitive rivalry for CMP. Along with it, brand-new entrants are likewise participating in the market increasing the competition for CMP.
Bargaining Power of Supplier.
The major suppliers of the Strategy And Competition Case Study Analysis consist of the suppliers of the paper for releasing documents. As CMP is the largest publisher in the Chinese Publishing Market, for that reason the overall bargaining power of supplier for CMP is low.
Bargaining Power of Buyer.
Bargaining power of purchaser in the publishing market is high. Due to the existence of a large number of publishers in the Chinese market and the market saturation, the buyers requires high quality documents at competitive rates.
Rivals Analysis.
CMP operates in an extremely competitive industry with the presence of large number of rivals. The business has a competitive position in the market with the highest market share in the Chinese publishing market. Major competitors of Strategy And Competition Case Study Analysis include;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIP acts as a danger 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 market share of CMP easily in the current market situation.
Posts and telecommunication Press (PTP).
Another close rival of CMP is PTP. It was likewise established in the same period as CMP and CIP. It ranks 6th in the state-owned publishers in regards to service scale. It is likewise among the popular players in the publishing industry with a yearly overall earnings of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Decreasing dependence over the Chinese markets.
• Increasing variety of Customers
• Growth opportunities.
• Preventing the impact of market saturation in the Chinese publishing market.
Cons
• Use of potential resources in expansion.
• Danger of failure in new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining consumer base.
• Approaching new markets.
• Easy to present utilizing current abilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased item portfolio supplies high value to consumers.
Cons
• Competition in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core business sectors to the new one can lead the company to lose demand of its items in the market.
Recommendations
As the choices are shifting towards digital publishing and the company require an immediate service to avoid the declining industry development. The business could also think about the growth program after the success of its digital publishing program.
Application
In order to present digital publishing in its product portfolio, the company should first collects the data related to the consumer demand, the prospective markets, the government guidelines and the information related to the competitors 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
Although, the development of the publishing industry is declining considering that 2008, revealing a threat to the business's long term existence, but the scenario can be controlled by considering a development plan in the future. The company might consider presenting digital publishingin its existing market to execute its development program at instant basis and to prevent the threat of failure for entrance in the brand-new markets.
