The main crisis facing the future transformation of Suning

Source: Internet
Author: User
Keywords Suning electric business strategy
Tags business business strategy company core business digital products electric business electric business strategy financial

Absrtact: Three years ago, Su Ning underestimated the electricity quotient, at the same time faced with the sudden rise of the electric quotient and its own performance decline, Su Ning appeared to be not prepared enough, to play China's Wal-Mart + Amazon role, but also the nasty under the wrong prescription, committed at the same time in two war

Three years ago, suning "underestimated" the electric quotient, at the same time in the face of the sudden rise of the electrical quotient and its own performance decline, Su Ning appears to be unprepared, it is to play China's "Wal-Mart + Amazon" role, but also the nasty under the wrong prescription, committed "at the same time in two battlefield combat" of the strategists taboo.

From the current year's air-conditioning sales to home appliances, and then from home appliances to 3C, Su Ning in its 22 development history has had two very successful business transformation, however, in the third transition to E-commerce, Su Ning is the first time to their own dynamic subtraction, but disorderly phalanx, not only lost the company's future development direction, Its hastily thrown e-commerce strategy (even the strategy is not) is also messy and short-sighted, now Su Ning renamed and again stressed to the transformation of the electricity business, and this is still facing a crisis.

For Su Ning, the transformation of E-commerce is facing a fleeting opportunity of "window period", its future transformation is facing three major crises:

The first is whether the transition strategy is clear enough, but at present, Su Ning still did not find the right target. In the United States, Wal-Mart and Amazon are completely different types of companies, simply, Wal-Mart is the pursuit of the lowest customer cost and the best user experience of the traditional retail giants, and Amazon is the customer experience first Internet company (no inventory and other traditional retail drag), the former operating a lot of difficult to standardize the furniture merchandise, Although Wal-Mart in recent years in the field of home appliances and digital products to catch up with e-commerce, but those difficult to standardize the furniture products are difficult to sell on the internet, which is Wal-Mart's competitive advantage in the community, and Amazon operating on the network are similar to books and audio-visual, digital products, such as highly standardized Suning has coveted Wal-Mart's lucrative profits in the retail industry, also want to copy Amazon online sales of flexible and simple, but this is like a lion chasing two different in the same direction of prey, the last can only be tired and exhausted, after all, "Wal-Mart + Amazon" is a non-existent Sibuxiang monster.

Secondly, the intensity of the transition is sufficient. If Su Ning, Gome is to defend as the core strategy, faltering "shoes", then Jing-dong, Ali is a preference for active offense, combat flexible "barefoot."

2012 Beijing East initiative launched several attacks are directly grin Su Ning's core business-everyone electricity, this used to be Suning's most profitable product category (its gross margin reached 21%-25%), but Jingdong "0 profit" offensive means not only to netting users, expand business, but also want to "for mansion", Directly disintegrates Su Ning's core superiority, drags down its financial performance, but all these are the capital investment which is up to the east of Beijing as up to billions of bets. One of the important characteristics of venture capital is the pursuit of high risk and high return, in the rapid expansion of the company's core business, can expand the site without loss. For Suning, it is more like a game of income from the left pocket to the right pocket, suning easy to buy each additional money, it seems to mean that from Suning's store took a piece of money, and the internal flow of income is at the expense of a sharp reduction in profit margins, so, regardless of from that point of view, so far, Suning's E-commerce platform Suning is still more like a large department of the company, its every move has to be subject to Su ning this huge body, the person in charge of Li Bin is only the president of Suning Group Assistant position. Throughout 2012, Suning easy to buy income of 18.3 billion yuan, and did not reach the beginning of the set 20 billion yuan target, the loss is estimated to be around 400 million, so large losses not only directly drag the financial performance of Suning, but also greatly affect the expansion of its e-commerce business speed.

Finally, Su Ning has enough financial skills to survive the transition crisis. A comprehensive survey of E-commerce Shiji 2012, Suning's sales performance decline, profit plunge and the number of stores cut is just the beginning of the crisis. As a listed company, Su Ning will have to face the dilemma of investors to vote with their feet and strategic investment is far from the two difficult issues. Lenovo Group of Hong-Yi investment in 2012 with 12.15 yuan per share of the price of 1.2 billion to participate in Suning's directional additional, for suning, to catch up with the pace of e-commerce, it needs not only financial investment, more urgent need is a large number of venture capital. The commercial temperament of home appliances and the commercial temperament of the Internet, after all, do not belong to the same circle, if the former needs to be stable, mature and cost control, then the latter pursuit of speed, bet and user experience first.

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