Suning

Suning Appliance Company Limited

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Suning Appliance Company Limited is bar far one of the leaders in its sector

SuningRapidly growing Chinese economy with spectacular yearly 9% growth rate gave rise to many retail shop chains, which emerged over the last decade. Nowadays, retail in China plays crucial role in economy with a lot of businesses being involved in commerce. Trade, based on B2C concept, is booming China with few chains being leaders of the industry. Suning Appliance Company operates franchised retail shops specializing on home electrical appliances, electronics and communications products. It also proved customers with repair-after-purchase service.

From small retailer to global chain

The company was founded in 1996 by Zhang Jindong, initially being called Suning Appliance Chain Store. In 2004, the company was quoted on Shenzhen Stock Exchange. Nowadays, Suning Appliance Company is the third largest in its sector with $17.09 billion sales and 12,450 employees. Being a rapidly growing company with headquarters based in Nanjing, it developed from 1,311 stores in 231 cities around China in 2010 to 1600 stores in 700 cities around China, Hong Kong and Japan in 2013. Moreover, its online platform, Suning.com, is a top three leader of Chinese B2C market.

Deterioration on company’s balance sheet does not make it worse off in terms of market leadership

During the past few years, there were considerable fluctuations in revenue growth though not often positive. As Forbes reports, in the first quarter of 2013, company’s profit dropped by 48.2 % (or $79 million) reaching 492.8 million Yuan. Even though company’s sales increased by 20% in the first three months of 2013 being 27.2 billion Yuan, it did not help the company to keep profit at the same level. On the contrary, it was predicted that net profit will fall by 60% in the following six months. However, as China Stock Market data suggests, profits started to fall one year earlier along with worsening financial indicators. In 2012, net profit growth was -31.37% and led to net profit after tax falling from 4820.594 million Yuan in 2011, which was the most profitable year for Suning, to 2351.993 million Yuan. Earnings per share dropped almost twice from 0.6890 in 2011 to 0.3321 in 2012, which is explained by almost double fall in net profit. Another crucial indicator, return on equity, also dropped from average 21% in 2011 and 2010 to 8.32% in 2012 showing considerably decreased net income relative to shareholders’ fund.

Rankings

Nevertheless, the company is still regarded as one of the leaders in the market. In 2013, it was ranked 28th among top 50 global retailers and its chairman, Zhang Jindong, was 412th on the Forbes list of 2013 billionaires with wealth of $3.3 billion.

Suning China

For further information, go to:

Branding in China

https://www.forbes.com/sites/russellflannery/2013/04/28/retail-rout-chinas-biggest-appliance-retailer-suning-says-1st-qtr-profit-down-48/

https://www.forbes.com/companies/suning-appliance/

https://listofcompanies.co.in/suning-appliance-co-ltd/

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