Gap Case

In: Business and Management

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Date and time received by the instructor/office _______________________________ (Leave blank)

ADMINISTRATIVE POLICY GMGT 4010

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Instructor: Jijun Gao A04 Wednesday 2:30-3:45

MIDTERM TAKE-HOME EXAM.
FALL 2014

Dear CEO,
Since Random House is continuing its expansion in the global region, I have some recommendations about the future business. Consider about the issues that customers’ behaviors change, the usage of large warehouses and the merge with other publishers, I have some analysis and alternatives to provide. Because your company is going to merge Penguin, the Chinese market it your next main market I have three business plans to help penetrate the new market.
All three strategies suggest enter Chinese market. First is to use broad cost leadership in the printed book market and use focus differentiation in the e-book market. The second strategy is to work with government to produce “political” books, which build an authoritative image. In addition, developing online distribution channel is another mission. The third strategy is to work with universities to provide books in different languages as well as develop an online-learning system.
All these three business plans are evaluated by three criteria: Net Present Value, the degree of easiness to enter the market and easiness to manage. When all assessed by these three standards, I recommend the third strategy. Although it dose not generate the highest NVP, it is relatively easy to penetrate the market and operate well. In my opinion, this project can grow steadily though not the fastest.
Finally, I make a five-year implementing plan. In this action plan I give the suggestion to enter the market step by step. The first step is building warehouses and sign contract as well as build the online system. Then lunch…...

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