The Newspaper Industry In Crisis 2 Case Study Solution and Analysis
Intro
The Newspaper Industry In Crisis 2 Case Study Analysis is the biggest publishing business with a greatest market share in the China's book retail market. CMP has actually ended up being a specialized info provider and a big extensive Science and Innovation publishing company through the combination of print media, audio-visual media and the network media.
Critical Issues
Although, The Newspaper Industry In Crisis 2 Case Study Help has spent its 60 years journey smoothly, being a successful publishing house, nevertheless, the changing macro market patterns and forces bring specific obstacles to the publishing industry in basic and CMP in particular. These elements consist of;
• Entryway of the brand-new publishing firms in the industry.
• Declining development of the publishing market.
• Market saturation.
• Introduction of digital publishing techniques
• Enhancement of science and technology.
The transformation of the macro markets have raised numerous questions to the management at CPM that what could be the future of CMP in this situation? Do the long important experience, technical resources and the abilities of the business could be used to strive for the future development unceasingly? How could the business sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
The Newspaper Industry In Crisis 2 Case Study Analysis has particular strengths that can be used to lower the threats, overcome the weakness and obtain the chances. Strengths of CMP are offered as follows;
• The long term experience of The Newspaper Industry In Crisis 2 Case Study Solution in the publishing industry i.e. 60 years allows the business to provide high quality products at a lower expense utilizing its previous experiences.
• The technical resources and capabilities produced by its effective journey provide a competitive benefit to CMP.
• Huge item portfolioof CMP assists it to diversify its danger and offer high worth to its consumers.
• Strong financial position allows the company to think about numerous advancement opportunities without any worry of raising fund externally.
Weaknesses
Along with the strengths, the company has specific weak points which might increase restraints for the business in executing its advancement program. The weaknesses of The Newspaper Industry In Crisis 2 Case Study Help are given as follows;
• Despite of being a science and technology publishing firm, the business still has traditional methods ofpublishing which are not compatible with the growing technological shift.
• CMP extremely relies over the Chinese markets for its development. It needs to propose particular expansion strategies to avoid its dependence over the Chinese markets to attain long term development.
Opportunities
The development of the publishing industry is decreasing considering that 2008, impacting The Newspaper Industry In Crisis 2 Case Study Help as well, however the development might be restored by availing certain opportunities presented in the market. The marketplace opportunities for CMP include;
• The business could also present Digital Publishing by using its long term technical experience and a strong consumer acknowledgment in the market.
• CMP could think about an advancement program through the growth towards foreign markets in order to decrease its reliance over Chinese markets by utilizing its huge financial resources.
Hazards
The changing macro trends in the market and increasing competition in the publishing market has positioned certain risks to The Newspaper Industry In Crisis 2 Case Study Help including;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries might cause decreasing market share of The Newspaper Industry In Crisis 2 Case Study Solution due to the consumer shift towards virtual libraries.
• The existence of a great deal of competitors in the publishing industry increase the threat for CMP to lose its competitive position in the market, as competitors can get a strong consumer base by using particular strategies like aggressive promotion, quality products, etc.
• Entrance of brand-new publishing firms in the industry along with existence of high competition increases the hazard of losing the client base.
Monetary Analysis.
The company has a quite competitive monetary performance. Due to absence of information, the monetary ratios of CMP might not be computed. The overall monetary efficiency of the company might be analyzed by utilizing the graphs provided in the case Appendices. It might be examined from the Appendix III that the annual overall revenues of CMP throughout the duration 2000-2012 are growing at a high development rate, showing that the annual demand of the products of The Newspaper Industry In Crisis 2 Case Study Solution is growing and the business is quite efficient in attracting a a great deal of consumers at a potential cost.
Together with it, the second graph which reveals the annual growth in the The Newspaper Industry In Crisis 2 Case Study Analysis total properties, reveals that the company is quite efficient in including worth to its possessions through its profits. The development in properties shows that the overall worth of the firm is likewise increasing with increasing the total revenues. (Unknown, 2013).
Another monetary analysis of the business utilizing the provided information could be the analysis relating to the distribution of total revenues of the business. Major part of the profits of CMP originates from the sales of its published books i.e. 64% as displayed in the Case Appendix V. The business could move towards other business segments with a possible development to achieve its future development goal.
PESTEL Analysis
PESTEL analysis might be conducted to learn the various external forces affecting the performance of the business and the recent trends in the external environment of the company. A brief PESTEL analysis of the business is offered as follows; (Alanzi, 2018).
Political.
As the publishing sector could have a considerable effect on the mindset of the people about the communist ideology of the federal government, therefore, the publishing sector is extremely monitored and assisted by the Publicity Department of the Communist Celebration of China. Therefore, it could be said that the total political forces impacting The Newspaper Industry In Crisis 2 Case Study Solution organisation are high. The government policies concerning the publishing sector are also increasing with the passage of time.
Affordable.
Financial forces affecting the publishing sector in general and the The Newspaper Industry In Crisis 2 Case Study Solution in particular includesthe prices of paper, the earnings level of consumers, the inflation rate, and the total GDP development of the nation. All these forces combine impact the need for the publishing market. Together with it, the financial policies associated with the import of books impact the total service at CPM. However, China's economic conditions are quite beneficial for CMP with high GDP growth and customer income level.
Social and Demographical.
The customer choices are moving towards digital publishing rather than the standard was of publishing. In this regard, CMP should focus on digital publishing to meet the changing customer choices.
Technological.
Technological forces impacting the CMP include the technological development in the reading methods etc. Enhancement of science and technology in addition to the rise of digital publishing could reduce the demand for the CMP items, if specific actions would not be taken quickly.
Environmental.
Environmental forces impacting The Newspaper Industry In Crisis 2 Case Study Solution includes the concerns of ecological neighborhoods 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 harmful for the environment.
Legal.
Legal policies for the publishing sector at whole are high. The legal policies relating to the publishing sector is controlled by the General Administration of Press and Publication. Publishing Ordinance 1997 needs the publishers to be approved first by the Federal government to be gone into in the publishing market. The regulation prohibits direct involvement of foreign entities and individuals in the publishing sector.
Market Analysis (Porter's Five Forces Model).
Porter's Five Forces Design might be utilized to analyze the appearance of the publishing market China. A brief analysis of the Porter's 5 Forces is provided as follows;.
Threat of New Entrants.
Risks of new entrants in the Chinese Publishing Market is moderate. The prospective growth in the market tends to draw in brand-new entrants to the publishing market. However, the presence of extreme competitors and the requirement of big capital tends to demotivate brand-new entrants to enter in the marketplace.
Danger of Alternative.
Hazard of Replacement is high for the Chinese Publishing Market. The substitute products for the published documents is the documents provided in the virtual libraries on specific websites. The changing customer preferences towards digital learning increase the risk of substitution for the industry.
Competitive Rivalry.
Competitive competition in the publishing industry is high. The presence of a great deal of customers in the Chinese Publishing Market 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 competitors for CMP.
Bargaining Power of Provider.
The major providers of the The Newspaper Industry In Crisis 2 Case Study Help include the suppliers of the paper for publishing 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 purchaser in the publishing market is high. Due to the existence of a a great deal of publishers in the Chinese market and the market saturation, the buyers requires high quality files at competitive costs.
Competitors Analysis.
CMP runs in a highly competitive market with the presence of large number of competitors. However, the business has a competitive position in the market with the highest market share in the Chinese publishing market. Significant competitors of The Newspaper Industry In Crisis 2 Case Study Analysis include;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIP acts as a hazard 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 scenario.
Posts and telecommunication Press (PTP).
Another close competitor of CMP is PTP. It was likewise established in the exact same period as CMP and CIP. It ranks 6th in the state-owned publishers in terms of organisation scale. It is likewise one of the prominent players in the publishing industry with a yearly overall incomes of RMB 550 million in 2010.
Alternatives
Alternative-1: Expand towards New Markets
Pros
• Lowering dependence over the Chinese markets.
• Increasing number of Consumers
• Growth chances.
• Avoiding the effect of market saturation in the Chinese publishing market.
Cons
• Use of prospective resources in expansion.
• Threat of failure in new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining consumer base.
• Approaching brand-new markets.
• Easy to introduce utilizing existing abilities.
• Low risk of Failure.
• Low requirement for funds.
• Increased item portfolio supplies high worth to consumers.
Cons
• Competition in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core service sectors to the new one can lead the company to lose demand of its items in the market.
Recommendations
With the deep analysis of the internal and external environment of the business in addition to the market analysis and the rival analysis, Alternative 2 is recommended to CMP to accomplish its future advancement. As the choices are moving towards digital publishing and the company require an immediate solution to prevent the decreasing market development. Therefore, intro of digital publishing could prove to be an instant option with low quantity of danger for the business. The company could also think about 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 first collects the data connected to the customer demand, the possible markets, the government guidelines and the data related to the rivals provided in the market. After that, the company should choose one potential sector for its initial offering. It needs to collect research study that how it might distinguish its digital publishing from the existing rivals' products. The steps above the business should go for the initial offering. If the initial offering proves a success, the business should choose the other markets. In this way the business would have the ability to implement its digital publishing program.
Conclusion
Although, the development of the publishing industry is decreasing since 2008, revealing a risk to the business's long term existence, however the scenario can be managed by thinking about an advancement strategy in the future. The business might think about introducing digital publishingin its existing market to execute its development program at instant basis and to prevent the danger of failure for entrance in the brand-new markets.
