Thumbs Up Video Inc Case Study Solution and Analysis
Thumbs Up Video Inc Case Study Analysis is the largest publishing company with a highest market share in the China's book retail market. CMP offers a variety of services including; gathering details, processing info and interaction services. Major organisation sectors of the company consist of; books, periodicals, consultancy and distribution. The business has a vast product portfolio and its significant products consist of books, regulars, online media, exhibitions, research study reports etc. Thumbs Up Video Inc Case Study Analysis has become a specialized information company and a big comprehensive Science and Innovation publishing business through the integration of print media, audio-visual media and the network media.
Although, Thumbs Up Video Inc Case Study Solution has actually spent its 60 years journey smoothly, being an effective publishing home, however, the changing macro market trends and forces bring specific obstacles to the publishing market in basic and CMP in specific. These aspects include;
• Entrance of the brand-new publishing companies in the industry.
• Declining growth of the publishing market.
• Market saturation.
• Introduction of digital publishing methods
• Improvement of science and innovation.
The change of the macro markets have raised numerous 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 company could be used to pursue the future development unceasingly? How could the company sustain its long term competitive position in future?
Thumbs Up Video Inc Case Study Solution has specific strengths that can be used to lower the hazards, conquer the weak point and avail the chances. Strengths of CMP are given as follows;
• The long term experience of Thumbs Up Video Inc Case Study Help in the publishing industry i.e. 60 years permits the business to offer high quality items at a lower expense using its prior experiences.
• The technical resources and capabilities generated by its successful journey offer a competitive advantage to CMP.
• Vast product portfolioof CMP helps it to diversify its threat and offer high worth to its customers.
• Strong monetary position allows the company to think about several development chances without any fear of raising fund externally.
In addition to the strengths, the business has certain weak points which could increase restrictions for the company in executing its development program. The weaknesses of Thumbs Up Video Inc Case Study Help are provided as follows;
• Despite of being a science and innovation publishing company, the business still has conventional ways ofpublishing which are not suitable with the growing technological shift.
• CMP highly relies over the Chinese markets for its growth. It needs to propose specific growth strategies to prevent its dependence over the Chinese markets to accomplish long term growth.
Although, the growth of the publishing market is declining because 2008, impacting Thumbs Up Video Inc Case Study Solution also, however the growth might be restored by availing certain opportunities presented in the market. The market opportunities for CMP consist of;
• The company might also introduce Digital Publishing by utilizing its long term technical experience and a strong customer recognition in the market.
• CMP might think about an advancement program through the growth towards foreign markets in order to minimize its reliance over Chinese markets by utilizing its huge funds.
The changing macro patterns in the market and increasing competitors in the publishing market has actually positioned specific hazards to Thumbs Up Video Inc Case Study Help consisting of;( Gurel, 2017).
• Intro of digital publishing i.e. virtual libraries could result in decreasing market share of Thumbs Up Video Inc Case Study Analysis due to the customer shift towards virtual libraries.
• The existence of a great deal of rivals in the publishing industry increase the danger for CMP to lose its competitive position in the market, as rivals can get a strong customer base by utilizing particular methods like aggressive promotion, quality items, etc.
• Entrance of brand-new publishing firms in the market in addition to presence of high competitors increases the threat of losing the customer base.
The company has a rather competitive monetary efficiency. Due to absence of data, the monetary ratios of CMP might not be calculated. However, the total monetary efficiency of the company might be examined by utilizing the graphs given in the case Appendices. It could be examined from the Appendix III that the annual 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 Thumbs Up Video Inc Case Study Help is growing and the business is quite effective in bring in a large number of clients at a possible price.
In addition to it, the second graph which reveals the yearly development in the Thumbs Up Video Inc Case Study Analysis total properties, shows that the business is rather efficient in including value to its properties through its profits. The development in possessions reveals that the overall worth of the firm is likewise increasing with increasing the overall incomes. (Unknown, 2013).
Another monetary analysis of the company using the offered information could be the analysis concerning the distribution of total earnings of the company. Major part of the earnings of CMP comes from the sales of its published books i.e. 64% as shown in the Case Appendix V. The business could move towards other service sections with a prospective development to accomplish its future advancement goal.
PESTEL analysis could be conducted to find out the numerous external forces impacting the performance of the company and the recent trends in the external environment of the business. A brief PESTEL analysis of the business is given as follows; (Alanzi, 2018).
As the publishing sector might have a considerable effect on the mindset of the people about the communist ideology of the government, for that reason, the publishing sector is highly monitored and assisted by the Promotion Department of the Communist Party of China. It could be said that the overall political forces impacting CMP organisation are high. The federal government policies relating to the publishing sector are likewise increasing with the passage of time.
Financial forces impacting the publishing sector in basic and the Thumbs Up Video Inc Case Study Solution in specific includesthe rates of paper, the earnings level of customers, the inflation rate, and the total GDP growth of the country. All these forces combine impact the demand for the publishing market. Together with it, the financial policies related to the import of books impact the total business at CPM. However, China's financial conditions are rather favorable for CMP with high GDP development and consumer income level.
Social and Demographical.
The customer choices are moving towards digital publishing rather than the standard was of publishing. In this regard, CMP needs to focus on digital publishing to meet the altering consumer choices.
Technological forces impacting the CMP include the technological development in the reading methods and so on. Improvement of science and innovation along with the increase of digital publishing could minimize the demand for the CMP products, if certain actions would not be taken quickly.
Ecological forces impacting Thumbs Up Video Inc Case Study Analysis consists of the issues of environmental neighborhoods over the usage of paper in publishing books. The paper utilized in the books while publishing is required to be disposable and the ink utilized while publishing needs to not be harmful for the environment.
Legal guidelines for the publishing sector at whole are high. The legal policies regarding the publishing sector is managed by the General Administration of Press and Publication. Publishing Ordinance 1997 requires the publishers to be approved first by the Government to be entered in the publishing market. The ordinance prohibits direct involvement of foreign entities and people in the publishing sector.
Market Analysis (Porter's 5 Forces Design).
Porter's Five Forces Model could be utilized to evaluate the appearance of the publishing industry China. A short analysis of the Porter's Five Forces is given as follows;.
Risk of New Entrants.
Hazards of new entrants in the Chinese Publishing Market is moderate. The possible development in the industry tends to bring in new entrants to the publishing industry. Nevertheless, the existence of extreme competition and the requirement of substantial capital tends to demotivate new entrants to enter in the market.
Risk of Alternative.
Hazard of Replacement is high for the Chinese Publishing Industry. The substitute items for the published documents is the files provided in the digital libraries on particular websites. The altering consumer choices towards digital learning increase the hazard of substitution for the market.
Competitive rivalry in the publishing industry is high. The existence of a great deal of customers in the Chinese Publishing Industry like CIP, PTP and so on tends to produce high competitive rivalry for CMP. In addition to it, brand-new entrants are also entering into the marketplace increasing the competition for CMP.
Bargaining Power of Provider.
The significant suppliers of the Thumbs Up Video Inc Case Study Analysis consist of the providers of the paper for releasing documents. As CMP is the biggest 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 presence of a large number of publishers in the Chinese market and the market saturation, the purchasers requires high quality files at competitive rates.
CMP runs in a highly competitive market with the existence of large number of rivals. However, the company has a competitive position in the market with the highest market share in the Chinese publishing market. Significant rivals of Thumbs Up Video Inc Case Study Help consist of;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIP acts as a hazard for CMP as it might 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 existing market situation.
Posts and telecommunication Press (PTP).
It was likewise established in the very same period as Thumbs Up Video Inc Case Study Solution and CIP. It is likewise one of the prominent gamers in the publishing industry with an annual overall earnings of RMB 550 million in 2010.
Alternative-1: Expand towards New Markets
• Decreasing dependence over the Chinese markets.
• Increasing number of Clients
• Growth chances.
• Preventing the effect of market saturation in the Chinese publishing market.
• Use of potential resources in expansion.
• Risk of failure in new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
• Sustaining customer base.
• Approaching new markets.
• Easy to present using present abilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased item portfolio provides high value to customers.
• Competitors in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core business sections to the new one can lead the company to lose demand of its products in the market.
With the deep analysis of the internal and external environment of the business along with the industry analysis and the competitor analysis, Alternative 2 is advised to CMP to attain its future development. As the preferences are shifting towards digital publishing and the company require an instant solution to avoid the declining market growth. For that reason, intro of digital publishing might show to be an instant option with low amount of threat for the company. The company might also think about the expansion program after the success of its digital publishing program.
In order to present digital publishing in its item portfolio, the company must initially gathers the information related to the consumer demand, the prospective markets, the federal government guidelines and the data related to the competitors provided in the market. If the preliminary offering proves a success, the company needs to go for the other markets. In this way the business would be able to implement its digital publishing program.
Although, the growth of the publishing industry is decreasing given that 2008, revealing a threat to the business's long term presence, but the situation can be managed by considering a development plan in the future. The company might consider presenting digital publishingin its existing market to implement its development program at immediate basis and to avoid the danger of failure for entrance in the new markets.