Virginia Investment Partners Optimal Portfolio Allocation 3 Case Study Solution and Analysis
Introduction
Virginia Investment Partners Optimal Portfolio Allocation 3 Case Study Help is the largest publishing business with a greatest market share in the China's book retail market. CMP has become a specialized information supplier and a large detailed Science and Technology publishing company through the combination of print media, audio-visual media and the network media.
Vital Concerns
CMP has spent its 60 years journey efficiently, being a successful publishing home, however, the altering macro market trends and forces bring certain challenges to the publishing market in basic and Virginia Investment Partners Optimal Portfolio Allocation 3 Case Study Help in particular. These factors include;
• Entrance of the brand-new publishing companies in the industry.
• Declining growth of the publishing market.
• Market saturation.
• Intro of digital publishing methods
• 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 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 business sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Virginia Investment Partners Optimal Portfolio Allocation 3 Case Study Help has specific strengths that can be utilized to reduce the hazards, overcome the weak point and avail the opportunities. Strengths of CMP are given as follows;
• The long term experience of Virginia Investment Partners Optimal Portfolio Allocation 3 Case Study Analysis in the publishing market i.e. 60 years enables the company to supply high quality items at a lower expense utilizing its previous experiences.
• The technical resources and capabilities created by its effective journey offer a competitive benefit to CMP.
• Vast product portfolioof CMP assists it to diversify its danger and offer high worth to its consumers.
• Strong financial position permits the company to think about a number of advancement chances without any worry of raising fund externally.
Weaknesses
Together with the strengths, the company has specific weak points which might increase constraints for the business in implementing its advancement program. The weaknesses of Virginia Investment Partners Optimal Portfolio Allocation 3 Case Study Help are provided as follows;
• Despite of being a science and innovation publishing company, the company still has standard methods ofpublishing which are not compatible with the growing technological shift.
• CMP extremely relies over the Chinese markets for its growth. It should propose certain expansion strategies to prevent its reliance over the Chinese markets to achieve long term development.
Opportunities
The development of the publishing market is declining considering that 2008, impacting Virginia Investment Partners Optimal Portfolio Allocation 3 Case Study Analysis as well, however the growth might be revived by availing certain opportunities presented in the market. The market chances for CMP consist of;
• The business could likewise introduce Digital Publishing by using its long term technical experience and a strong client acknowledgment in the market.
• CMP could think about an advancement program through the expansion towards foreign markets in order to decrease its reliance over Chinese markets by utilizing its large financial resources.
Dangers
The changing macro patterns in the market and increasing competition in the publishing industry has actually postured specific threats to Virginia Investment Partners Optimal Portfolio Allocation 3 Case Study Analysis including;( Gurel, 2017).
• Intro of digital publishing i.e. virtual libraries could result in decreasing market share of Virginia Investment Partners Optimal Portfolio Allocation 3 Case Study Analysis due to the consumer shift towards virtual libraries.
• The presence of large number of competitors in the publishing industry increase the danger for CMP to lose its competitive position in the market, as competitors can acquire a strong customer base by utilizing certain techniques like aggressive promo, quality products, and so on
• Entrance of new publishing firms in the market in addition to presence of high competitors increases the hazard of losing the consumer base.
Monetary Analysis.
Due to absence of information, the financial ratios of CMP might not be determined. It might be evaluated from the Appendix III that the yearly total earnings of Virginia Investment Partners Optimal Portfolio Allocation 3 Case Study Solution during the duration 2000-2012 are growing at a high development rate, showing that the annual demand of the products of CMP is growing and the business is rather efficient in attracting a large number of consumers at a possible rate.
Along with it, the second chart which reveals the annual development in the Virginia Investment Partners Optimal Portfolio Allocation 3 Case Study Analysis overall properties, shows that the business is rather effective in including worth to its properties through its profits. The development in properties shows that the overall value of the firm is also increasing with increasing the overall profits. (Unidentified, 2013).
Another financial analysis of the company using the provided information could be the analysis regarding the circulation of total profits of the company. Huge part of the earnings of CMP originates from the sales of its published books i.e. 64% as displayed in the Case Appendix V. The company could move towards other business sections with a possible growth to achieve its future development goal.
PESTEL Analysis
PESTEL analysis might be carried out to learn the different external forces impacting the performance of the company and the current patterns in the external environment of the business. A brief PESTEL analysis of the company is given as follows; (Alanzi, 2018).
Political.
As the publishing sector could have a considerable impact on the mindset of individuals about the communist ideology of the federal government, therefore, the publishing sector is extremely supervised and directed by the Promotion Department of the Communist Party of China. It could be stated that the overall political forces impacting CMP company are high. The federal government policies concerning the publishing sector are also increasing with the passage of time.
Cost-effective.
Economic forces impacting the publishing sector in general and the Virginia Investment Partners Optimal Portfolio Allocation 3 Case Study Help in specific includesthe costs of paper, the earnings level of customers, the inflation rate, and the total GDP growth of the country. All these forces integrate effect the need for the publishing market. Along with it, the economic policies connected to the import of books impact the total service at CPM. China's economic conditions are quite beneficial for CMP with high GDP growth and consumer income level.
Social and Demographical.
The consumer choices are moving towards digital publishing rather than the conventional was of publishing. In this regard, CMP should focus on digital publishing to meet the altering consumer preferences.
Technological.
Technological forces impacting the CMP include the technological development in the reading methods etc. Improvement of science and technology in addition to the rise of digital publishing could reduce the demand for the CMP products, if particular actions would not be taken soon.
Environmental.
Environmental forces affecting Virginia Investment Partners Optimal Portfolio Allocation 3 Case Study Solution includes the issues of environmental neighborhoods over the usage of paper in publishing books. The paper used in the books while publishing is needed to be disposable and the ink used while publishing needs to not be harmful for the environment.
Legal.
Legal regulations for the publishing sector at whole are high. Publishing Regulation 1997 needs the publishers to be authorized first by the Government to be gone into in the publishing market.
Market Analysis (Porter's Five Forces Model).
Porter's 5 Forces Model might be used to evaluate the attractiveness of the publishing industry China. A short analysis of the Porter's Five Forces is provided as follows;.
Risk of New Entrants.
Threats of new entrants in the Chinese Publishing Industry is moderate. The possible growth in the industry tends to attract new entrants to the publishing market. Nevertheless, the presence of intense competition and the requirement of huge capital tends to demotivate new entrants to go into in the market.
Risk of Substitution.
Threat of Substitution is high for the Chinese Publishing Market. The substitute products for the released documents is the documents provided in the digital libraries on specific sites. The changing customer choices towards digital knowing increase the risk 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 competition for CMP. Along with it, brand-new entrants are likewise participating in the market increasing the competitors for CMP.
Bargaining Power of Supplier.
The significant suppliers of the Virginia Investment Partners Optimal Portfolio Allocation 3 Case Study Solution include the suppliers of the paper for releasing documents. As CMP is the biggest publisher in the Chinese Publishing Market, for that reason the total bargaining power of provider for CMP is low.
Bargaining Power of Purchaser.
Negotiating power of buyer in the publishing market is high. Due to the presence of a a great deal of publishers in the Chinese market and the market saturation, the buyers requires high quality documents at competitive prices.
Competitors Analysis.
CMP operates in a highly competitive industry with the existence of large number of competitors. However, the company has a competitive position in the market with the highest market share in the Chinese publishing market. Significant competitors of Virginia Investment Partners Optimal Portfolio Allocation 3 Case Study Analysis consist of;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIP acts as a risk 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 current market situation.
Posts and telecommunication Press (PTP).
Another close rival of CMP is PTP. It was likewise founded in the very same duration as CMP and CIP. It ranks sixth in the state-owned publishers in regards to company scale. It is also one of the popular players in the publishing industry with an annual total earnings of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Minimizing dependence over the Chinese markets.
• Increasing number of Consumers
• Development chances.
• Avoiding the effect of market saturation in the Chinese publishing industry.
Cons
• Use of potential resources in growth.
• Danger of failure in new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining customer base.
• Approaching brand-new markets.
• Easy to introduce using current capabilities.
• Low risk of Failure.
• Low requirement for funds.
• Increased item portfolio offers 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 organisation sections to the new one can lead the company to lose need of its products in the market.
Suggestions
With the deep analysis of the external and internal environment of the business along with the industry analysis and the competitor analysis, Alternative 2 is recommended to CMP to accomplish its future advancement. As the preferences are shifting towards digital publishing and the business need an immediate solution to avoid the decreasing industry development. Introduction of digital publishing might show to be an immediate solution with low quantity of threat for the business. Nevertheless, the business might also think about the growth program after the success of its digital publishing program.
Implementation
In order to introduce digital publishing in its item portfolio, the business should first gathers the data related to the customer need, the potential markets, the government policies and the information related to the competitors provided in the market. If the preliminary offering proves a success, the business needs to go for the other markets. In this method the business would be able to implement its digital publishing program.
Conclusion
The development of the publishing industry is decreasing considering that 2008, revealing a danger to the business's long term presence, however the circumstance can be managed by considering a development strategy in the future. The company could consider introducing digital publishingin its existing market to implement its advancement program at instant basis and to avoid the risk of failure for entrance in the new markets.
