The Path Of Lease Resistance How Changes To Lease Accounting Treatment May Impact Your Business 2 Case Study Solution and Analysis
Introduction
The Path Of Lease Resistance How Changes To Lease Accounting Treatment May Impact Your Business 2 Case Study Analysis is the largest publishing business with a highest market share in the China's book retail market. CMP offers a variety of services consisting of; gathering info, processing details and interaction services. Significant organisation sectors of the business consist of; books, periodicals, consultancy and circulation. The company has a large product portfolio and its significant products include books, regulars, online media, exhibits, research reports etc. The Path Of Lease Resistance How Changes To Lease Accounting Treatment May Impact Your Business 2 Case Study Solution has ended up being a specialized information supplier and a large thorough Science and Technology publishing business through the combination of print media, audio-visual media and the network media.
Crucial Problems
Although, The Path Of Lease Resistance How Changes To Lease Accounting Treatment May Impact Your Business 2 Case Study Solution has actually invested its 60 years journey efficiently, being a successful publishing house, however, the altering macro market trends and forces bring particular obstacles to the publishing market in basic and CMP in particular. These elements include;
• Entrance of the brand-new publishing firms in the industry.
• Decreasing growth of the publishing market.
• Market saturation.
• Intro of digital publishing techniques
• Improvement of science and technology.
The improvement of the macro markets have raised numerous concerns to the management at CPM that what could be the future of CMP in this situation? 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 Path Of Lease Resistance How Changes To Lease Accounting Treatment May Impact Your Business 2 Case Study Analysis has specific strengths that can be utilized to minimize the hazards, conquer the weakness and obtain the chances. Strengths of CMP are given as follows;
• The long term experience of The Path Of Lease Resistance How Changes To Lease Accounting Treatment May Impact Your Business 2 Case Study Analysis in the publishing market i.e. 60 years enables the company to offer high quality items at a lower expense using its previous experiences.
• The technical resources and capabilities created by its effective journey provide a competitive benefit to CMP.
• Huge item portfolioof CMP assists it to diversify its danger and provide high worth to its customers.
• Strong financial position permits the business to think about numerous development opportunities without any fear of raising fund externally.
Weaknesses
Along with the strengths, the company has particular weaknesses which might increase constraints for the business in implementing its development program. The weaknesses of The Path Of Lease Resistance How Changes To Lease Accounting Treatment May Impact Your Business 2 Case Study Solution are offered as follows;
• Despite of being a science and innovation publishing firm, the company still has conventional ways ofpublishing which are not suitable with the growing technological shift.
• CMP extremely relies over the Chinese markets for its development. It ought to propose specific growth strategies to avoid its reliance over the Chinese markets to accomplish long term development.
Opportunities
The development of the publishing industry is declining because 2008, affecting The Path Of Lease Resistance How Changes To Lease Accounting Treatment May Impact Your Business 2 Case Study Analysis as well, however the growth might be revived by availing specific chances provided in the market. The market chances for CMP consist of;
• The company might also present Digital Publishing by using its long term technical experience and a strong consumer acknowledgment in the market.
• CMP might consider a development program through the growth towards foreign markets in order to minimize its dependence over Chinese markets by using its large funds.
Threats
The changing macro trends in the market and increasing competition in the publishing industry has postured particular threats to The Path Of Lease Resistance How Changes To Lease Accounting Treatment May Impact Your Business 2 Case Study Help including;( Gurel, 2017).
• Introduction of digital publishing i.e. digital libraries might result in declining market share of The Path Of Lease Resistance How Changes To Lease Accounting Treatment May Impact Your Business 2 Case Study Analysis due to the customer shift towards virtual libraries.
• The existence of a great deal of competitors in the publishing market increase the danger for CMP to lose its competitive position in the market, as rivals can get a strong customer base by utilizing certain methods like aggressive promotion, quality items, and so on
• Entryway of brand-new publishing companies in the market along with existence of high competition increases the risk of losing the client base.
Monetary Analysis.
The company has a quite competitive financial efficiency. Due to lack of data, the monetary ratios of CMP could not be determined. The overall monetary performance of the company might be evaluated by using the charts provided in the case Appendices. It could be evaluated from the Appendix III that the annual total revenues of CMP during the period 2000-2012 are growing at a high development rate, showing that the yearly demand of the products of The Path Of Lease Resistance How Changes To Lease Accounting Treatment May Impact Your Business 2 Case Study Analysis is growing and the business is quite efficient in drawing in a large number of consumers at a potential cost.
Along with it, the second chart which reveals the yearly development in the The Path Of Lease Resistance How Changes To Lease Accounting Treatment May Impact Your Business 2 Case Study Help total assets, shows that the business is quite efficient in including worth to its possessions through its earnings. The development in assets reveals that the overall value of the firm is also increasing with increasing the overall profits. (Unknown, 2013).
Another financial analysis of the company using the given data could be the analysis relating to the distribution of overall revenues of the business. Huge part of the profits of CMP comes from the sales of its released books i.e. 64% as shown in the Case Appendix V. The business might move towards other company segments with a possible development to accomplish its future development goal.
PESTEL Analysis
PESTEL analysis might be carried out to discover the various external forces affecting the performance of the company and the current trends in the external environment of the business. A quick PESTEL analysis of the company is offered as follows; (Alanzi, 2018).
Political.
As the publishing sector could have a substantial effect on the frame of mind of individuals about the communist ideology of the government, therefore, the publishing sector is extremely monitored and guided by the Publicity Department of the Communist Celebration of China. It might be stated that the overall political forces impacting CMP service are high. The federal government policies relating to the publishing sector are also increasing with the passage of time.
Economical.
Economic forces affecting the publishing sector in basic and the CMP in specific includesthe prices of paper, the income level of consumers, the inflation rate, and the general GDP growth of the country. All these forces integrate impact the demand for the publishing market.
Social and Demographical.
Social and demographical forces consist of the population development, the customer's choices towards reading helpful materials etc. China has the greatest population worldwide with a high population development, revealing the increasing variety of customers of the The Path Of Lease Resistance How Changes To Lease Accounting Treatment May Impact Your Business 2 Case Study Solution. The customer choices are shifting towards digital publishing rather than the conventional was of publishing. In this regard, CMP must focus on digital publishing to satisfy the changing consumer choices.
Technological.
Technological forces affecting the CMP consist of the technological improvement in the reading strategies etc. Improvement of science and technology along with the increase of digital publishing could decrease the need for the CMP products, if particular actions would not be taken quickly.
Environmental.
Environmental forces affecting The Path Of Lease Resistance How Changes To Lease Accounting Treatment May Impact Your Business 2 Case Study Analysis consists of 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 non reusable and the ink used while publishing ought to not be damaging for the environment.
Legal.
Legal regulations for the publishing sector at whole are high. The legal guidelines regarding 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 Federal government to be gone into in the publishing market. The regulation prohibits direct involvement of foreign entities and individuals in the publishing sector.
Industry Analysis (Porter's 5 Forces Design).
Porter's 5 Forces Model could be utilized to examine the attractiveness of the publishing industry China. A short analysis of the Porter's 5 Forces is offered as follows;.
Threat of New Entrants.
Threats of brand-new entrants in the Chinese Publishing Industry is moderate. The prospective development in the industry tends to attract brand-new entrants to the publishing market. Nevertheless, the existence of intense competitors and the requirement of big capital tends to demotivate brand-new entrants to enter in the marketplace.
Danger of Alternative.
Danger of Substitution is high for the Chinese Publishing Industry. The alternative items for the published files is the documents provided in the virtual libraries on specific websites. The changing customer preferences towards digital knowing increase the danger of alternative for the industry.
Competitive Competition.
Competitive rivalry in the publishing market is high. The presence of large number of consumers in the Chinese Publishing Market like CIP, PTP etc. tends to produce high competitive rivalry for CMP. In addition to it, brand-new entrants are also entering into the market increasing the competition for CMP.
Bargaining Power of Provider.
The significant providers of the The Path Of Lease Resistance How Changes To Lease Accounting Treatment May Impact Your Business 2 Case Study Help consist of the providers of the paper for releasing documents. As CMP is the biggest publisher in the Chinese Publishing Market, for that reason the overall bargaining power of provider for CMP is low.
Bargaining Power of Buyer.
Bargaining power of purchaser in the publishing industry is high. Due to the presence of a a great deal of publishers in the Chinese market and the market saturation, the purchasers needs high quality documents at competitive rates.
Competitors Analysis.
CMP operates in a highly competitive market with the presence of large number of competitors. The business has a competitive position in the market with the highest market share in the Chinese publishing market. Major competitors of The Path Of Lease Resistance How Changes To Lease Accounting Treatment May Impact Your Business 2 Case Study Solution consist of;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market 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 quickly in the existing market situation.
Posts and telecommunication Press (PTP).
It was also founded in the exact same duration as The Path Of Lease Resistance How Changes To Lease Accounting Treatment May Impact Your Business 2 Case Study Analysis and CIP. It is also one of the prominent gamers in the publishing market with an annual overall earnings of RMB 550 million in 2010.
Alternatives
Alternative-1: Expand towards New Markets
Pros
• Decreasing reliance over the Chinese markets.
• Increasing number of Customers
• Development chances.
• Avoiding the impact of market saturation in the Chinese publishing industry.
Cons
• Usage of prospective resources in expansion.
• Threat of failure in new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining customer base.
• Approaching brand-new markets.
• Easy to introduce utilizing present abilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased product portfolio offers high value to clients.
Cons
• Competitors in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core business sections to the brand-new one can lead the business to lose demand of its items in the market.
Suggestions
With the deep analysis of the internal and external environment of the company along with the market analysis and the competitor analysis, Alternative 2 is suggested to CMP to achieve its future development. As the preferences are moving towards digital publishing and the company require an instant option to prevent the decreasing industry growth. Therefore, introduction of digital publishing could show to be an instant solution with low quantity of danger for the company. The business might also consider the expansion program after the success of its digital publishing program.
Implementation
In order to present digital publishing in its product portfolio, the business must first collects the data related to the consumer need, the potential markets, the federal government guidelines and the data related to the rivals presented in the market. If the initial offering proves a success, the business should go for the other markets. In this method the company would be able to implement its digital publishing program.
Conclusion
Although, the development of the publishing industry is declining considering that 2008, revealing a risk to the business's long term existence, but the scenario can be managed by considering a development strategy in the future. The business might consider introducing digital publishingin its existing market to implement its development program at instant basis and to avoid the risk of failure for entrance in the new markets.
