Wildcat Capital Investors Real Estate Private Equity 2 Case Study Solution and Analysis
Introduction
Wildcat Capital Investors Real Estate Private Equity 2 Case Study Analysis is the biggest publishing company with a greatest market share in the China's book retail market. CMP has actually ended up being a specialized information service provider and a large comprehensive Science and Technology publishing company through the combination of print media, audio-visual media and the network media.
Important Concerns
Although, Wildcat Capital Investors Real Estate Private Equity 2 Case Study Analysis has actually spent its 60 years journey smoothly, being an effective publishing house, nevertheless, the changing macro market patterns and forces bring particular difficulties to the publishing market in basic and CMP in specific. These factors consist of;
• Entryway of the new publishing firms in the market.
• Decreasing development of the publishing market.
• Market saturation.
• Intro of digital publishing methods
• Enhancement of science and technology.
The change of the macro markets have raised a number of questions 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 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
Wildcat Capital Investors Real Estate Private Equity 2 Case Study Analysis has specific strengths that can be used to lower the dangers, get rid of the weakness and avail the opportunities. Strengths of CMP are given as follows;
• The long term experience of Wildcat Capital Investors Real Estate Private Equity 2 Case Study Help in the publishing industry i.e. 60 years permits the company to supply high quality items at a lower cost using its prior experiences.
• The technical resources and capabilities produced by its effective journey supply a competitive advantage to CMP.
• Vast product portfolioof CMP helps it to diversify its risk and offer high worth to its consumers.
• Strong monetary position enables the business to think about numerous advancement opportunities with no worry of raising fund externally.
Weak points
In addition to the strengths, the business has particular weak points which could increase restraints for the business in implementing its advancement program. The weak points of Wildcat Capital Investors Real Estate Private Equity 2 Case Study Solution are offered as follows;
• Despite of being a science and technology publishing company, the company still has conventional ways ofpublishing which are not compatible with the growing technological shift.
• CMP extremely relies over the Chinese markets for its development. It ought to propose specific growth plans to avoid its dependence over the Chinese markets to attain long term development.
Opportunities
The growth of the publishing market is declining considering that 2008, impacting Wildcat Capital Investors Real Estate Private Equity 2 Case Study Help as well, but the development might be restored by availing particular chances provided in the market. The market opportunities for CMP include;
• The company could also introduce Digital Publishing by using its long term technical experience and a strong client acknowledgment in the market.
• CMP could consider a development program through the expansion towards foreign markets in order to lower its dependence over Chinese markets by utilizing its large funds.
Risks
The altering macro patterns in the market and increasing competition in the publishing market has presented particular threats to Wildcat Capital Investors Real Estate Private Equity 2 Case Study Analysis consisting of;( Gurel, 2017).
• Introduction of digital publishing i.e. virtual libraries might result in decreasing market share of Wildcat Capital Investors Real Estate Private Equity 2 Case Study Analysis due to the customer shift towards virtual libraries.
• The presence of large number of competitors in the publishing market increase the threat for CMP to lose its competitive position in the market, as rivals can gain a strong customer base by utilizing particular strategies like aggressive promo, quality items, etc.
• Entrance of brand-new publishing companies in the market in addition to presence of high competition increases the hazard of losing the customer base.
Financial Analysis.
The company has a quite competitive monetary performance. Due to absence of information, the monetary ratios of CMP could not be calculated. The general monetary performance of the company could be examined by using the graphs given in the case Appendices. It might be examined from the Appendix III that the yearly overall revenues of CMP during the period 2000-2012 are growing at a high development rate, showing that the annual need of the items of Wildcat Capital Investors Real Estate Private Equity 2 Case Study Solution is growing and the company is quite efficient in drawing in a large number of clients at a potential cost.
Together with it, the second chart which shows the yearly development in the Wildcat Capital Investors Real Estate Private Equity 2 Case Study Help total assets, reveals that the company is rather effective in including worth to its possessions through its profits. The development in assets shows that the overall worth of the company is also increasing with increasing the overall earnings. (Unknown, 2013).
Another monetary analysis of the business using the offered data might be the analysis relating to the circulation of overall revenues of the business. 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 might move towards other company sections with a prospective development to achieve its future advancement goal.
PESTEL Analysis
PESTEL analysis could be performed to find out the numerous external forces impacting the performance of the business and the recent trends in the external environment of the business. A quick PESTEL analysis of the business is offered as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a substantial effect on the mindset of individuals about the communist ideology of the federal government, therefore, the publishing sector is highly monitored and guided by the Publicity Department of the Communist Party of China. Therefore, it might be said that the overall political forces impacting Wildcat Capital Investors Real Estate Private Equity 2 Case Study Analysis company are high. The federal government policies concerning the publishing sector are likewise increasing with the passage of time.
Economical.
Economic forces impacting the publishing sector in general and the Wildcat Capital Investors Real Estate Private Equity 2 Case Study Solution in specific includesthe costs of paper, the income level of consumers, the inflation rate, and the total GDP development of the nation. All these forces integrate impact the demand for the publishing market. Along with it, the economic policies related to the import of books impact the general service at CPM. Nevertheless, China's economic conditions are quite beneficial for CMP with high GDP development and customer earnings level.
Social and Demographical.
The customer choices are shifting towards digital publishing rather than the conventional was of publishing. In this regard, CMP needs to focus on digital publishing to fulfill the altering customer choices.
Technological.
Technological forces affecting the CMP consist of the technological development in the reading techniques etc. Enhancement of science and technology together with the rise of digital publishing might minimize the need for the CMP items, if certain actions would not be taken soon.
Environmental.
Ecological forces affecting Wildcat Capital Investors Real Estate Private Equity 2 Case Study Solution includes the concerns of ecological neighborhoods over the use of paper in publishing books. The paper used in the books while publishing is required to be disposable and the ink utilized while publishing should not be hazardous for the environment.
Legal.
Legal policies for the publishing sector at whole are high. The legal guidelines concerning the publishing sector is controlled by the General Administration of Press and Publication. Publishing Regulation 1997 requires the publishers to be authorized first by the Federal government to be gone into in the publishing market. The ordinance forbids direct participation of foreign entities and individuals in the publishing sector.
Industry Analysis (Porter's Five Forces Model).
Porter's Five Forces Model might be utilized to evaluate the beauty of the publishing market China. A short analysis of the Porter's Five Forces is provided as follows;.
Hazard of New Entrants.
Threats of new entrants in the Chinese Publishing Industry is moderate. The possible development in the industry tends to bring in brand-new entrants to the publishing industry. However, the presence of extreme competition and the requirement of substantial capital tends to demotivate new entrants to go into in the market.
Hazard of Substitution.
Danger of Alternative is high for the Chinese Publishing Industry. The replacement products for the published documents is the documents presented in the virtual libraries on specific websites. The changing customer preferences towards digital learning increase the hazard of alternative for the market.
Competitive Competition.
Competitive rivalry in the publishing industry is high. The presence of a great deal of consumers in the Chinese Publishing Market like CIP, PTP etc. tends to produce high competitive competition for CMP. In addition to it, brand-new entrants are likewise entering into the market increasing the competitors for CMP.
Bargaining Power of Supplier.
The major suppliers of the Wildcat Capital Investors Real Estate Private Equity 2 Case Study Help include the providers of the paper for releasing files. As CMP is the biggest publisher in the Chinese Publishing Market, therefore the total bargaining power of provider for CMP is low.
Bargaining Power of Buyer.
Negotiating power of buyer 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 buyers requires high quality documents at competitive rates.
Competitors Analysis.
CMP operates in an extremely competitive market with the existence of a great deal of rivals. Nevertheless, the company has a competitive position in the market with the highest market share in the Chinese publishing market. Major competitors of Wildcat Capital Investors Real Estate Private Equity 2 Case Study Solution include;.
• Chemical Market 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 easily in the present market situation.
Posts and telecommunication Press (PTP).
It was also founded in the exact same duration as Wildcat Capital Investors Real Estate Private Equity 2 Case Study Analysis and CIP. It is also one of the popular players in the publishing industry with an annual total revenues of RMB 550 million in 2010.
Alternatives
Alternative-1: Expand towards New Markets
Pros
• Lowering dependence over the Chinese markets.
• Increasing variety of Consumers
• Growth opportunities.
• Avoiding the effect of market saturation in the Chinese publishing market.
Cons
• Usage of prospective resources in growth.
• Risk of failure in brand-new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
Pros
• Sustaining customer base.
• Approaching new markets.
• Easy to present utilizing current capabilities.
• Low danger 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 business segments to the new one can lead the business to lose demand of its products in the market.
Recommendations
As the choices are shifting towards digital publishing and the business require an instant option to avoid the declining industry development. The company could likewise think about the expansion program after the success of its digital publishing program.
Implementation
In order to present digital publishing in its product portfolio, the company should first gathers the information related to the customer demand, the potential markets, the government policies and the information related to the competitors provided in the market. If the preliminary offering shows a success, the business ought to go for the other markets. In this way the business would be able to implement its digital publishing program.
Conclusion
Although, the development of the publishing market is declining since 2008, revealing a hazard to the business's long term existence, however the situation can be controlled by considering a development plan in the future. The company might consider introducing digital publishingin its existing market to execute its development program at immediate basis and to prevent the risk of failure for entryway in the new markets.
