Suntech Power Holdings B The Post Ipo Years 2 Case Study Solution and Analysis
Intro
Suntech Power Holdings B The Post Ipo Years 2 Case Study Analysis is the biggest publishing company with a greatest market share in the China's book retail market. CMP has ended up being a specialized details supplier and a large detailed Science and Technology publishing business through the combination of print media, audio-visual media and the network media.
Vital Concerns
Although, Suntech Power Holdings B The Post Ipo Years 2 Case Study Analysis has actually invested its 60 years journey efficiently, being a successful publishing home, however, the changing macro market trends and forces bring specific obstacles to the publishing market in general and CMP in specific. These aspects consist of;
• Entryway of the brand-new publishing companies in the market.
• Declining development of the publishing market.
• Market saturation.
• Introduction of digital publishing strategies
• Improvement of science and technology.
The transformation of the macro markets have raised a number of questions 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 capabilities of the company could be used 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
Suntech Power Holdings B The Post Ipo Years 2 Case Study Solution has particular strengths that can be made use of to minimize the hazards, overcome the weakness and avail the opportunities. Strengths of CMP are provided as follows;
• The long term experience of Suntech Power Holdings B The Post Ipo Years 2 Case Study Analysis in the publishing industry i.e. 60 years permits the business to provide high quality products at a lower cost using its previous experiences.
• The technical resources and capabilities generated by its effective journey offer a competitive advantage to CMP.
• Huge product portfolioof CMP helps it to diversify its risk and offer high worth to its customers.
• Strong financial position permits the company to think about numerous advancement chances with no worry of raising fund externally.
Weaknesses
In addition to the strengths, the company has particular weak points which might increase constraints for the company in executing its advancement program. The weak points of Suntech Power Holdings B The Post Ipo Years 2 Case Study Help are offered as follows;
• Despite of being a science and innovation publishing company, the business still has standard ways ofpublishing which are not suitable with the growing technological shift.
• CMP highly relies over the Chinese markets for its growth. It ought to propose specific expansion plans to prevent its reliance over the Chinese markets to accomplish long term development.
Opportunities
The development of the publishing market is decreasing since 2008, affecting Suntech Power Holdings B The Post Ipo Years 2 Case Study Help as well, however the development could be revived by availing particular opportunities presented in the market. The marketplace chances for CMP include;
• The company could likewise introduce Digital Publishing by using its long term technical experience and a strong client recognition in the market.
• CMP might consider a development program through the expansion towards foreign markets in order to decrease its reliance over Chinese markets by using its vast financial resources.
Threats
The changing macro patterns in the market and increasing competition in the publishing market has actually positioned particular hazards to Suntech Power Holdings B The Post Ipo Years 2 Case Study Analysis consisting of;( Gurel, 2017).
• Introduction of digital publishing i.e. digital libraries might result in declining market share of Suntech Power Holdings B The Post Ipo Years 2 Case Study Analysis due to the customer shift towards virtual libraries.
• The presence of a great deal of rivals in the publishing market increase the hazard for CMP to lose its competitive position in the market, as competitors can acquire a strong customer base by utilizing particular strategies like aggressive promotion, quality products, and so on
• Entryway of brand-new publishing companies in the market along with presence of high competitors increases the hazard of losing the customer base.
Monetary Analysis.
The business has a quite competitive financial efficiency. Due to lack of information, the monetary ratios of CMP could not be computed. However, the overall monetary efficiency of the company could be evaluated by using the charts given up the case Appendices. It could be analyzed from the Appendix III that the yearly overall profits of CMP during the duration 2000-2012 are growing at a high development rate, revealing that the yearly demand of the products of Suntech Power Holdings B The Post Ipo Years 2 Case Study Help is growing and the business is quite effective in bring in a large number of consumers at a possible cost.
Together with it, the 2nd graph which reveals the yearly growth in the Suntech Power Holdings B The Post Ipo Years 2 Case Study Help overall assets, reveals that the business is rather effective in including worth to its assets through its revenues. The growth in possessions reveals that the overall worth of the company is likewise increasing with increasing the total revenues. (Unknown, 2013).
Another financial analysis of the company utilizing the provided information could be the analysis regarding the circulation of overall revenues of the business. Huge part of the earnings of CMP originates from the sales of its published books i.e. 64% as displayed in the Case Appendix V. The company might move towards other business segments with a prospective development to accomplish its future development objective.
PESTEL Analysis
PESTEL analysis might be conducted to discover the numerous external forces impacting the performance of the business and the current patterns in the external environment of the company. A short PESTEL analysis of the business is provided as follows; (Alanzi, 2018).
Political.
As the publishing sector could have a substantial influence on the state of mind of individuals about the communist ideology of the federal government, therefore, the publishing sector is highly monitored and assisted by the Publicity Department of the Communist Celebration of China. For that reason, it might be said that the overall political forces affecting Suntech Power Holdings B The Post Ipo Years 2 Case Study Help company are high. The federal government policies relating to the publishing sector are likewise increasing with the passage of time.
Cost-effective.
Economic forces impacting the publishing sector in basic and the CMP in specific includesthe prices of paper, the earnings level of customers, the inflation rate, and the general GDP growth of the country. All these forces integrate impact the need for the publishing market.
Social and Demographical.
The customer preferences are shifting towards digital publishing rather than the standard was of publishing. In this regard, CMP needs to focus on digital publishing to fulfill the altering consumer choices.
Technological.
Technological forces impacting the CMP consist of the technological advancement in the reading strategies etc. Improvement of science and innovation in addition to the rise of digital publishing could reduce the need for the CMP products, if specific actions would not be taken soon.
Environmental.
Environmental forces affecting Suntech Power Holdings B The Post Ipo Years 2 Case Study Help includes the concerns of ecological 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 should not be damaging for the environment.
Legal.
Legal guidelines for the publishing sector at whole are high. The legal regulations relating to the publishing sector is controlled 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 participation of foreign entities and people in the publishing sector.
Market Analysis (Porter's Five Forces Design).
Porter's 5 Forces Design might be utilized to examine the appearance of the publishing industry China. A short analysis of the Porter's Five Forces is provided as follows;.
Hazard of New Entrants.
Dangers of brand-new entrants in the Chinese Publishing Market is moderate. The prospective growth in the industry tends to bring in new entrants to the publishing industry. However, the presence of intense competition and the requirement of big capital tends to demotivate new entrants to go into in the marketplace.
Hazard of Alternative.
Hazard of Substitution is high for the Chinese Publishing Industry. The alternative items for the published files is the files provided in the virtual libraries on particular sites. The altering customer choices towards digital learning increase the threat of alternative for the industry.
Competitive Rivalry.
Competitive competition in the publishing industry is high. The presence of large number 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 entering into the marketplace increasing the competition for CMP.
Bargaining Power of Supplier.
The significant providers of the Suntech Power Holdings B The Post Ipo Years 2 Case Study Solution include the suppliers of the paper for releasing documents. As CMP is the biggest publisher in the Chinese Publishing Market, therefore the general bargaining power of provider for CMP is low.
Bargaining Power of Buyer.
Haggling power of buyer in the publishing industry is high. Due to the presence of a a great deal of publishers in the Chinese market and the marketplace saturation, the buyers needs high quality files at competitive costs.
Rivals Analysis.
CMP operates in an extremely competitive market 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. Major competitors of Suntech Power Holdings B The Post Ipo Years 2 Case Study Help consist of;.
• Chemical Industry 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 publishes similar type of books. For a big time period, CIP held the largest market share, and still ranks 3rd and 2nd in various market sections, with a significant focus on instructional publications. CIP acts as a danger for CMP as it could wean its market share due to its long term competitive background. CIP is concentrated on digital publishing and could wean the market share of Suntech Power Holdings B The Post Ipo Years 2 Case Study Help easily in the present market scenario.
Posts and telecommunication Press (PTP).
Another close rival of CMP is PTP. It was likewise founded in the same duration as CMP and CIP. It ranks sixth in the state-owned publishers in regards to company scale. It is likewise among the prominent players in the publishing market with an annual total revenues of RMB 550 million in 2010.
Alternatives
Alternative-1: Expand towards New Markets
Pros
• Reducing dependence over the Chinese markets.
• Increasing variety of Consumers
• Growth chances.
• Avoiding the effect of market saturation in the Chinese publishing market.
Cons
• Use of potential 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 using present abilities.
• Low risk of Failure.
• Low requirement for funds.
• Increased product portfolio supplies high value to clients.
Cons
• Competitors in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core company sections to the brand-new one can lead the company to lose demand of its products in the market.
Suggestions
As the choices are shifting towards digital publishing and the business require an immediate service to avoid the decreasing industry 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 needs to initially gathers the data related to the consumer demand, the prospective markets, the federal government guidelines and the information related to the rivals presented in the market. If the preliminary offering shows a success, the company ought to go for the other markets. In this way the company would be able to implement its digital publishing program.
Conclusion
Although, the growth of the publishing market is declining considering that 2008, revealing a threat to the company's long term presence, but the scenario can be managed by thinking about a development strategy in the future. The business could think about presenting digital publishingin its existing market to implement its advancement program at immediate basis and to prevent the risk of failure for entrance in the new markets.
