The Automobile Industry And The Economic Downturn Case Study Solution and Analysis
Introduction
The Automobile Industry And The Economic Downturn Case Study Analysis is the biggest publishing company with a highest market share in the China's book retail market. CMP has actually ended up being a specialized details service provider and a large thorough Science and Innovation publishing company through the integration of print media, audio-visual media and the network media.
Crucial Problems
Although, The Automobile Industry And The Economic Downturn Case Study Analysis has invested its 60 years journey smoothly, being a successful publishing home, however, the altering macro market trends and forces bring particular obstacles to the publishing market in general and CMP in particular. These factors consist of;
• Entrance of the brand-new publishing companies 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 several 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 capabilities of the business could be used to strive for the future advancement unceasingly? How could the company sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
The Automobile Industry And The Economic Downturn Case Study Solution has specific strengths that can be utilized to reduce the risks, get rid of the weakness and avail the opportunities. Strengths of CMP are provided as follows;
• The long term experience of The Automobile Industry And The Economic Downturn Case Study Solution in the publishing industry i.e. 60 years permits the business to provide high quality items at a lower expense using its prior experiences.
• The technical resources and capabilities produced by its successful journey supply a competitive advantage to CMP.
• Vast item portfolioof CMP assists it to diversify its danger and provide high worth to its clients.
• Strong monetary position permits the company to consider numerous advancement chances with no fear of raising fund externally.
Weaknesses
In addition to the strengths, the business has particular weak points which might increase restrictions for the business in implementing its development program. The weak points of The Automobile Industry And The Economic Downturn Case Study Solution are offered as follows;
• Despite of being a science and technology publishing company, the company 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 specific expansion plans to avoid its reliance over the Chinese markets to accomplish long term development.
Opportunities
Although, the growth of the publishing industry is decreasing considering that 2008, impacting The Automobile Industry And The Economic Downturn Case Study Solution also, but the growth could be revived by availing specific chances presented in the market. The marketplace chances for CMP consist of;
• The business could likewise introduce Digital Publishing by utilizing its long term technical experience and a strong client acknowledgment in the market.
• CMP might consider a development program through the expansion towards foreign markets in order to decrease its dependence over Chinese markets by utilizing its vast funds.
Threats
The altering macro patterns in the market and increasing competitors in the publishing industry has posed particular risks to The Automobile Industry And The Economic Downturn Case Study Help including;( Gurel, 2017).
• Intro of digital publishing i.e. virtual libraries might lead to declining market share of The Automobile Industry And The Economic Downturn Case Study Analysis due to the customer shift towards virtual libraries.
• The existence of a great deal of competitors in the publishing industry increase the danger for CMP to lose its competitive position in the market, as rivals can get a strong consumer base by using certain techniques like aggressive promo, quality items, and so on
• Entryway of new publishing companies in the market together with presence of high competition increases the threat of losing the consumer base.
Financial Analysis.
Due to lack of information, the financial ratios of CMP could not be computed. It might be analyzed from the Appendix III that the annual overall profits of The Automobile Industry And The Economic Downturn Case Study Solution during the duration 2000-2012 are growing at a high development rate, revealing that the annual demand of the items of CMP is growing and the company is rather efficient in bring in a big number of customers at a possible rate.
Together with it, the second chart which shows the annual growth in the The Automobile Industry And The Economic Downturn Case Study Solution overall properties, shows that the company is quite efficient in adding worth to its assets through its earnings. The growth in possessions reveals that the total value of the company is also increasing with increasing the overall profits. (Unknown, 2013).
Another financial analysis of the company using the offered data could be the analysis concerning the distribution of total revenues of the business. Huge part of the earnings of CMP comes from the sales of its released books i.e. 64% as shown in the Case Appendix V. The company might move towards other service segments with a prospective development to attain its future advancement objective.
PESTEL Analysis
PESTEL analysis could be conducted to discover the different external forces affecting the efficiency of the business and the recent patterns in the external environment of the business. A quick PESTEL analysis of the company is given as follows; (Alanzi, 2018).
Political.
As the publishing sector could have a significant effect on the mindset of the people about the communist ideology of the federal government, therefore, the publishing sector is extremely monitored and directed by the Promotion Department of the Communist Party of China. It could be stated that the general political forces affecting CMP service are high. The federal government policies relating to the publishing sector are also increasing with the passage of time.
Affordable.
Economic forces affecting the publishing sector in basic and the The Automobile Industry And The Economic Downturn Case Study Solution in specific includesthe rates of paper, the earnings level of customers, the inflation rate, and the total GDP development of the nation. All these forces combine impact the need for the publishing market. In addition to it, the economic policies connected to the import of books impact the total service at CPM. China's financial conditions are rather beneficial for CMP with high GDP development and consumer earnings level.
Social and Demographical.
Social and demographical forces consist of the population development, the consumer's choices towards checking out informative products etc. China has the greatest population in the world with a high population development, revealing the increasing number of consumers of the The Automobile Industry And The Economic Downturn Case Study Help. Nevertheless, the consumer choices are moving towards digital publishing instead of the conventional was of publishing. In this regard, CMP must concentrate on digital publishing to satisfy the altering consumer preferences.
Technological.
Technological forces impacting the CMP consist of the technological development in the reading methods etc. Improvement of science and innovation along with the rise of digital publishing might reduce the demand for the CMP products, if particular actions would not be taken soon.
Environmental.
Ecological forces affecting The Automobile Industry And The Economic Downturn Case Study Solution includes the concerns of ecological communities over the usage of paper in publishing books. The paper utilized in the books while publishing is required to be non reusable and the ink utilized while publishing needs to not be hazardous for the environment.
Legal.
Legal policies for the publishing sector at whole are high. Publishing Ordinance 1997 requires the publishers to be authorized initially by the Government to be entered in the publishing market.
Market Analysis (Porter's Five Forces Design).
Porter's Five Forces Design might be used to evaluate the appearance of the publishing market China. A brief analysis of the Porter's Five Forces is offered as follows;.
Hazard of New Entrants.
Threats of brand-new entrants in the Chinese Publishing Market is moderate. The prospective development in the industry tends to bring in brand-new entrants to the publishing market. The existence of intense competitors and the requirement of huge capital tends to demotivate new entrants to go into in the market.
Hazard of Replacement.
Threat of Alternative is high for the Chinese Publishing Industry. The alternative products for the published documents is the documents provided in the virtual libraries on certain websites. The altering customer preferences towards digital knowing increase the hazard of replacement for the market.
Competitive Rivalry.
Competitive competition in the publishing industry is high. The existence of a great deal of consumers in the Chinese Publishing Market like CIP, PTP etc. tends to produce high competitive rivalry for CMP. Along with it, brand-new entrants are likewise entering into the marketplace increasing the competitors for CMP.
Bargaining Power of Supplier.
The significant providers of the The Automobile Industry And The Economic Downturn Case Study Solution include the suppliers of the paper for publishing files. As CMP is the largest publisher in the Chinese Publishing Market, for that reason the total 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 presence of a large number of publishers in the Chinese market and the market saturation, the purchasers needs high quality documents at competitive costs.
Competitors Analysis.
CMP operates in an extremely competitive industry with the existence of large number of rivals. The company has a competitive position in the market with the highest market share in the Chinese publishing market. Significant rivals of The Automobile Industry And The Economic Downturn Case Study Help consist of;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIP acts as a danger for CMP as it might 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 current market situation.
Posts and telecommunication Press (PTP).
Another close competitor of CMP is PTP. It was likewise established in the very same duration as CMP and CIP. It ranks 6th in the state-owned publishers in regards to business scale. It is also one of the popular gamers in the publishing market with an annual total earnings of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Decreasing reliance over the Chinese markets.
• Increasing number of Customers
• Growth opportunities.
• Avoiding the impact of market saturation in the Chinese publishing industry.
Cons
• Use of possible 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 using existing abilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased product portfolio supplies high value to consumers.
Cons
• Competition in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core organisation sectors to the brand-new one can lead the company to lose need of its items in the market.
Suggestions
With the deep analysis of the external and internal environment of the company in addition to the industry 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 company require an instant option to avoid the declining industry development. For that reason, introduction of digital publishing might show to be an instant solution with low quantity of threat for the business. The company could also consider the growth program after the success of its digital publishing program.
Application
In order to present digital publishing in its item portfolio, the company must initially gathers the data related to the customer demand, the possible markets, the government regulations and the data related to the rivals presented in the market. If the initial offering proves a success, the business must go for the other markets. In this method the business would be able to execute its digital publishing program.
Conclusion
Although, the development of the publishing industry is declining given that 2008, revealing a threat to the business's long term presence, but the scenario can be managed by considering an advancement strategy in the future. The business could think about introducing digital publishingin its existing market to implement its advancement program at instant basis and to avoid the danger of failure for entryway in the brand-new markets.
