The Economist 2 Case Study Solution and Analysis
Intro
The Economist 2 Case Study Solution is the largest publishing company with a highest market share in the China's book retail market. CMP provides a variety of services consisting of; gathering details, processing info and interaction services. Major company sections of the company include; books, regulars, consultancy and circulation. The company has a vast item portfolio and its major items consist of books, periodicals, online media, exhibits, research study reports etc. The Economist 2 Case Study Help has actually ended up being a specialized information provider and a big comprehensive Science and Technology publishing business through the integration of print media, audio-visual media and the network media.
Critical Concerns
CMP has invested its 60 years journey smoothly, being a successful publishing house, nevertheless, the altering macro market trends and forces bring particular obstacles to the publishing industry in general and The Economist 2 Case Study Solution in specific. These elements include;
• Entrance of the new publishing firms in the industry.
• Decreasing development of the publishing market.
• Market saturation.
• Intro of digital publishing techniques
• Improvement of science and innovation.
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 abilities of the company could be utilized to pursue the future development unceasingly? How could the company sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
The Economist 2 Case Study Analysis has specific strengths that can be made use of to lower the risks, overcome the weakness and obtain the chances. Strengths of CMP are offered as follows;
• The long term experience of The Economist 2 Case Study Solution in the publishing industry i.e. 60 years enables the business to supply high quality items at a lower cost utilizing its previous experiences.
• The technical resources and abilities created by its successful journey provide a competitive benefit to CMP.
• Vast product portfolioof CMP helps it to diversify its risk and supply high worth to its consumers.
• Strong financial position enables the business to consider numerous advancement chances with no fear of raising fund externally.
Weaknesses
In addition to the strengths, the business has specific weak points which might increase restrictions for the company in implementing its advancement program. The weaknesses of The Economist 2 Case Study Solution are given as follows;
• Despite of being a science and innovation publishing company, the business still has standard methods ofpublishing which are not suitable with the growing technological shift.
• CMP extremely relies over the Chinese markets for its development. It should propose certain expansion strategies to avoid its reliance over the Chinese markets to accomplish long term growth.
Opportunities
The growth of the publishing industry is declining since 2008, affecting The Economist 2 Case Study Help as well, but the development could be revived by availing certain chances presented in the market. The marketplace opportunities for CMP include;
• The company could also introduce Digital Publishing by utilizing its long term technical experience and a strong customer recognition in the market.
• CMP could consider an advancement program through the growth towards foreign markets in order to lower its dependence over Chinese markets by utilizing its vast financial resources.
Hazards
The altering macro patterns in the market and increasing competitors in the publishing industry has posed specific threats to The Economist 2 Case Study Help consisting of;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries might result in declining market share of The Economist 2 Case Study Solution due to the customer shift towards virtual libraries.
• The existence of large number of competitors in the publishing industry increase the hazard for CMP to lose its competitive position in the market, as competitors can gain a strong consumer base by using certain techniques like aggressive promo, quality products, and so on
• Entrance of brand-new publishing companies in the market together with existence of high competitors increases the hazard of losing the client base.
Monetary Analysis.
Due to lack of data, the monetary ratios of CMP might not be computed. It could be evaluated from the Appendix III that the annual total revenues of The Economist 2 Case Study Help during the period 2000-2012 are growing at a high growth rate, showing that the yearly demand of the items of CMP is growing and the business is quite efficient in bring in a big number of consumers at a possible cost.
Along with it, the second chart which shows the yearly development in the The Economist 2 Case Study Solution overall possessions, reveals that the company is rather efficient in adding worth to its assets through its revenues. The development in possessions shows that the overall value of the firm is also increasing with increasing the overall profits. (Unknown, 2013).
Another financial analysis of the company utilizing the offered data might be the analysis concerning the distribution of overall revenues of the business. 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 company segments with a possible growth to attain its future advancement goal.
PESTEL Analysis
PESTEL analysis might be conducted to learn the different external forces impacting the performance of the business and the recent patterns in the external environment of the company. A short PESTEL analysis of the company is provided as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a significant effect on the mindset of the people about the communist ideology of the federal government, for that reason, the publishing sector is extremely supervised and assisted by the Promotion Department of the Communist Party of China. Therefore, it could be said that the overall political forces impacting The Economist 2 Case Study Solution organisation are high. The federal government policies relating to the publishing sector are likewise increasing with the passage of time.
Economical.
Economic forces impacting the publishing sector in general and the The Economist 2 Case Study Help in particular includesthe rates of paper, the income level of consumers, the inflation rate, and the total GDP growth of the country. All these forces integrate effect the demand for the publishing market. In addition to it, the financial policies related to the import of books affect the overall organisation at CPM. China's economic conditions are quite beneficial for CMP with high GDP growth and customer income level.
Social and Demographical.
The customer choices are shifting towards digital publishing rather than the traditional was of publishing. In this regard, CMP must focus on digital publishing to fulfill the changing customer preferences.
Technological.
Technological forces impacting the CMP include the technological improvement in the reading techniques and so on. Improvement of science and innovation along with the rise of digital publishing could decrease the demand for the CMP products, if certain actions would not be taken quickly.
Environmental.
Ecological forces affecting The Economist 2 Case Study Analysis includes the issues of environmental neighborhoods over the usage of paper in publishing books. The paper utilized in the books while publishing is needed to be disposable and the ink used while publishing ought to not be harmful for the environment.
Legal.
Legal policies for the publishing sector at whole are high. Publishing Ordinance 1997 requires the publishers to be authorized first by the Federal government to be entered in the publishing market.
Industry Analysis (Porter's 5 Forces Model).
Porter's 5 Forces Model could be used to analyze the beauty of the publishing market China. A brief analysis of the Porter's Five Forces is given as follows;.
Hazard of New Entrants.
Threats of brand-new entrants in the Chinese Publishing Market is moderate. The possible development in the industry tends to draw in brand-new entrants to the publishing market. Nevertheless, the existence of extreme competitors and the requirement of big capital tends to demotivate new entrants to enter in the marketplace.
Danger of Replacement.
Threat of Replacement is high for the Chinese Publishing Market. The replacement items for the released documents is the files presented in the virtual libraries on particular sites. The altering consumer choices towards digital learning 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 and so on tends to produce high competitive rivalry for CMP. Along with it, brand-new entrants are also entering into the market increasing the competitors for CMP.
Bargaining Power of Provider.
The significant providers of the The Economist 2 Case Study Analysis consist of the suppliers of the paper for releasing files. As CMP is the largest publisher in the Chinese Publishing Market, therefore the overall bargaining power of supplier for CMP is low.
Bargaining Power of Purchaser.
Bargaining power of buyer in the publishing industry is high. Due to the presence of a large number of publishers in the Chinese market and the marketplace saturation, the purchasers requires high quality documents at competitive costs.
Rivals Analysis.
CMP operates in a highly competitive industry with the presence of large number of rivals. Nevertheless, the business has a competitive position in the market with the greatest market share in the Chinese publishing market. Major competitors of The Economist 2 Case Study Solution consist of;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIPis among the close competitors of CMP. Established in the same period, CIP releases similar kind of books. For a large period, CIP held the biggest market share, and still ranks 3rd and second in numerous market segments, with a significant concentrate on instructional publications. CIP serves as a threat for CMP as it could wean its market share due to its long term competitive background. CIP is concentrated on digital publishing and might wean the market share of The Economist 2 Case Study Help easily in the present market situation.
Posts and telecommunication Press (PTP).
Another close rival of CMP is PTP. It was also founded in the very same period as CMP and CIP. It ranks sixth in the state-owned publishers in terms of organisation scale. It is likewise one of the prominent players in the publishing market with an annual total incomes of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Minimizing reliance over the Chinese markets.
• Increasing number of Consumers
• Growth opportunities.
• Avoiding the effect of market saturation in the Chinese publishing industry.
Cons
• Usage of prospective resources in expansion.
• Risk of failure in new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
Pros
• Sustaining consumer base.
• Approaching new markets.
• Easy to present utilizing current abilities.
• Low risk of Failure.
• Low requirement for funds.
• Increased item portfolio offers 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 organisation segments to the new one can lead the company to lose demand of its items in the market.
Suggestions
As the preferences are moving towards digital publishing and the company require an immediate solution to avoid the decreasing industry growth. The business might also think about the expansion program after the success of its digital publishing program.
Implementation
In order to introduce digital publishing in its product portfolio, the company should initially collects the information connected to the customer demand, the potential markets, the federal government guidelines and the information associated with the rivals presented in the market. After that, the business ought to choose one potential sector for its initial offering. It must gather research study that how it might differentiate its digital publishing from the existing rivals' items. The steps above the company should go for the preliminary offering. If the preliminary offering proves a success, the company ought to opt for the other markets. In this method the company would have the ability to execute its digital publishing program.
Conclusion
The growth of the publishing market is declining since 2008, revealing a hazard to the company's long term existence, however the scenario can be managed by thinking about an advancement plan in the future. The business could think about introducing digital publishingin its existing market to execute its advancement program at immediate basis and to prevent the danger of failure for entrance in the brand-new markets.
