Withdrawing Water From An Aquifer The Economics Case Study Solution and Analysis
Introduction
Withdrawing Water From An Aquifer The Economics Case Study Solution is the biggest publishing company with a highest market share in the China's book retail market. CMP provides a variety of services including; gathering details, processing details and interaction services. Significant organisation sections of the company consist of; books, regulars, consultancy and circulation. The company has a vast item portfolio and its significant items consist of books, regulars, online media, exhibitions, research study reports and so on. Withdrawing Water From An Aquifer The Economics Case Study Solution has actually ended up being a specialized info supplier and a large comprehensive Science and Technology publishing business through the combination of print media, audio-visual media and the network media.
Critical Problems
Although, Withdrawing Water From An Aquifer The Economics Case Study Analysis has actually spent its 60 years journey smoothly, being a successful publishing home, however, the altering macro market trends and forces bring specific obstacles to the publishing market in basic and CMP in specific. These factors include;
• Entryway of the new publishing firms in the market.
• Decreasing growth of the publishing market.
• Market saturation.
• Intro of digital publishing techniques
• Enhancement 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 circumstance? Do the long important experience, technical resources and the abilities 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
Withdrawing Water From An Aquifer The Economics Case Study Analysis has particular strengths that can be made use of to minimize the risks, conquer the weak point and get the opportunities. Strengths of CMP are offered as follows;
• The long term experience of Withdrawing Water From An Aquifer The Economics Case Study Help in the publishing market i.e. 60 years enables the business to supply high quality products at a lower expense using its previous experiences.
• The technical resources and abilities produced by its effective journey supply a competitive advantage to CMP.
• Large product portfolioof CMP helps it to diversify its risk and supply high value to its customers.
• Strong monetary position allows the company to think about a number of advancement opportunities without any worry of raising fund externally.
Weaknesses
Along with the strengths, the company has specific weak points which could increase restraints for the business in executing its development program. The weak points of Withdrawing Water From An Aquifer The Economics Case Study Solution are provided 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 growth. It must propose particular expansion plans to prevent its dependence over the Chinese markets to achieve long term development.
Opportunities
Although, the growth of the publishing industry is declining since 2008, impacting Withdrawing Water From An Aquifer The Economics Case Study Solution also, however the development might be revived by availing particular opportunities provided in the market. The market chances for CMP consist of;
• The business might also present Digital Publishing by utilizing its long term technical experience and a strong customer acknowledgment in the market.
• CMP might consider an advancement program through the growth towards foreign markets in order to minimize its dependence over Chinese markets by using its large funds.
Risks
The altering macro patterns in the market and increasing competition in the publishing market has actually posed certain dangers to Withdrawing Water From An Aquifer The Economics Case Study Help consisting of;( Gurel, 2017).
• Introduction of digital publishing i.e. virtual libraries could result in decreasing market share of Withdrawing Water From An Aquifer The Economics Case Study Solution due to the customer shift towards virtual libraries.
• The presence of a great deal of competitors in the publishing industry increase the risk for CMP to lose its competitive position in the market, as rivals can acquire a strong consumer base by using certain methods like aggressive promo, quality products, and so on
• Entrance of new publishing companies in the industry together with existence of high competitors increases the hazard of losing the consumer base.
Financial Analysis.
The business has a quite competitive monetary performance. Due to absence of data, the financial ratios of CMP might not be determined. The overall financial performance of the company might be analyzed by using the charts provided in the case Appendices. It could be analyzed from the Appendix III that the yearly overall revenues of CMP throughout the period 2000-2012 are growing at a high development rate, showing that the annual demand of the items of Withdrawing Water From An Aquifer The Economics Case Study Help is growing and the business is rather efficient in drawing in a large number of customers at a prospective price.
Along with it, the second chart which reveals the yearly growth in the Withdrawing Water From An Aquifer The Economics Case Study Solution overall assets, reveals that the company is quite efficient in including value to its assets through its incomes. The development in properties shows that the overall value of the company is likewise increasing with increasing the total revenues. (Unknown, 2013).
Another monetary analysis of the company using the given information might be the analysis relating to the distribution of total profits of the business. Huge part of the revenues of CMP originates from the sales of its released books i.e. 64% as shown in the Case Appendix V. The company might move towards other organisation segments with a prospective growth to attain its future advancement goal.
PESTEL Analysis
PESTEL analysis might be carried out to learn the various external forces affecting the performance of the company and the recent patterns in the external environment of the company. A short PESTEL analysis of the company is given as follows; (Alanzi, 2018).
Political.
As the publishing sector might have a substantial effect on the frame of mind of individuals about the communist ideology of the government, for that reason, the publishing sector is extremely monitored and assisted by the Publicity Department of the Communist Celebration of China. For that reason, it could be said that the total political forces impacting Withdrawing Water From An Aquifer The Economics Case Study Solution business are high. The government policies relating to the publishing sector are also increasing with the passage of time.
Economical.
Economic forces impacting the publishing sector in general and the Withdrawing Water From An Aquifer The Economics Case Study Solution in particular includesthe prices of paper, the income level of customers, the inflation rate, and the overall GDP development of the country. All these forces integrate effect the demand for the publishing market. Along with it, the financial policies connected to the import of books affect the overall service at CPM. However, China's economic conditions are rather beneficial for CMP with high GDP development and customer income level.
Social and Demographical.
Social and demographical forces consist of the population growth, the consumer's preferences towards reading informative products and so on. China has the highest population on the planet with a high population development, revealing the increasing variety of customers of the Withdrawing Water From An Aquifer The Economics Case Study Analysis. However, the customer choices are moving towards digital publishing rather than the traditional was of publishing. In this regard, CMP should focus on digital publishing to satisfy the altering consumer preferences.
Technological.
Technological forces impacting the CMP include the technological improvement in the reading methods etc. Improvement of science and innovation along with the increase of digital publishing could reduce the need for the CMP products, if specific actions would not be taken quickly.
Environmental.
Ecological forces affecting Withdrawing Water From An Aquifer The Economics Case Study Analysis includes the issues of environmental neighborhoods 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 should not be hazardous for the environment.
Legal.
Legal guidelines for the publishing sector at whole are high. The legal guidelines regarding the publishing sector is managed by the General Administration of Press and Publication. Publishing Ordinance 1997 needs the publishers to be authorized initially by the Government to be gone into in the publishing market. The regulation prohibits direct involvement of foreign entities and people in the publishing sector.
Industry Analysis (Porter's 5 Forces Design).
Porter's 5 Forces Design might be utilized to examine the attractiveness of the publishing market China. A quick analysis of the Porter's 5 Forces is provided as follows;.
Risk of New Entrants.
Threats of brand-new entrants in the Chinese Publishing Industry is moderate. The prospective development in the market tends to attract new entrants to the publishing market. The presence of intense competitors and the requirement of substantial capital tends to demotivate new entrants to enter in the market.
Hazard of Replacement.
Risk of Alternative is high for the Chinese Publishing Industry. The alternative items for the released files is the files provided in the virtual libraries on particular sites. The altering consumer choices towards digital learning increase the hazard of substitution for the market.
Competitive Competition.
Competitive rivalry in the publishing industry is high. The existence of large number of consumers in the Chinese Publishing Industry like CIP, PTP etc. tends to produce high competitive rivalry for CMP. In addition to it, new entrants are likewise participating in the marketplace increasing the competitors for CMP.
Bargaining Power of Supplier.
The major providers of the Withdrawing Water From An Aquifer The Economics Case Study Solution include the providers of the paper for publishing documents. As CMP is the largest publisher in the Chinese Publishing Market, therefore the total bargaining power of provider for CMP is low.
Bargaining Power of Buyer.
Haggling 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 needs high quality documents at competitive prices.
Competitors Analysis.
CMP runs in a highly competitive industry with the existence of a great deal of competitors. The business has a competitive position in the market with the highest market share in the Chinese publishing market. Significant rivals of Withdrawing Water From An Aquifer The Economics Case Study Help include;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market 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 might wean the market share of CMP quickly in the existing market circumstance.
Posts and telecommunication Press (PTP).
It was likewise founded in the exact same duration as Withdrawing Water From An Aquifer The Economics Case Study Solution and CIP. It is also one of the prominent players in the publishing market with an annual total profits of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden 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 potential resources in growth.
• Risk of failure in brand-new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
Pros
• Sustaining consumer base.
• Approaching new markets.
• Easy to introduce using present capabilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased item portfolio offers high worth to clients.
Cons
• Competitors in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core service segments to the new one can lead the company to lose demand of its items in the market.
Recommendations
With the deep analysis of the external and internal environment of the business in addition to the industry analysis and the competitor analysis, Alternative 2 is suggested to CMP to achieve its future development. As the choices are shifting towards digital publishing and the business require an instant solution to prevent the declining market growth. Introduction of digital publishing might show to be an immediate service with low amount of danger for the company. Nevertheless, the company might likewise consider the expansion program after the success of its digital publishing program.
Application
In order to introduce digital publishing in its product portfolio, the company needs to first gathers the information related to the consumer need, the potential markets, the government policies and the data related to the rivals presented in the market. If the preliminary offering shows a success, the company ought to go for the other markets. In this method the business would be able to execute its digital publishing program.
Conclusion
Although, the growth of the publishing market is decreasing given that 2008, revealing a hazard to the company's long term existence, but the situation can be controlled by considering a development strategy in the future. The business might consider introducing digital publishingin its existing market to execute its advancement program at immediate basis and to avoid the threat of failure for entryway in the new markets.
