For the future planning of the Chinese market, Yamanashi stated that YAMADA DENKI has already established a holding company in Beijing to coordinate its business in China, named "Yamada Electric (China) Investment Co., Ltd." The goal for the 5 stores to be opened within the next 3 years is to achieve a sales expectation of 10 billion yen.
Wu Xianjian, an insider in the home appliance chain retail industry, stated that Yamada Electric is adopting a more lifestyle-oriented format in China, which is a new format compared to the home appliance mass merchandising model of Gome and Suning; on the contrary to Walmart and Carrefour, which emphasize living categories with 3C as auxiliary, Yamada Electric's competitive point against large supermarkets lies in the professionalism of 3C. Specifically, its product accessories and software account for a larger proportion, and small appliances, cosmetics, and toys also occupy a certain percentage.
The two stores of Yamada Electric in Shenyang and Tianjin are both located in the core business districts of the two cities. The Shenyang store has a total of 7 floors, with a total area of 24,000 square meters, gathering 1.5 million items; the Tianjin store has five floors of shopping area, with an area of approximately 15,000 square meters, and will be the largest-scale home appliance retail store in Tianjin city. In addition to electronic products, the two stores also sell fast-moving consumer goods such as cosmetics, food, and toys.
Yamada Electric's entry into the Chinese market has been met with quite a lot of skepticism.
On June 9, Japan's largest home appliance retailer Yamada Electric announced externally that its store in Tianjin, China, will open on the 10th, and at the same time, it will launch an e-commerce platform for online shopping in Tianjin. Last December, the company opened its first store in Shenyang, China.
According to the introduction by Yamanashi, in terms of merchandise operation, Yamada Electric adopts a buyout operating model, without manufacturer promoters in the stores; in terms of product configuration, besides home appliance products, Yamada Electric also prepares general merchandise including cosmetics and toys; in terms of supplier relations, Yamada Electric does not charge additional fees to suppliers and adopts a cash payment method.
In response to this, Yamanashi stated that Yamada Electric is different from Suning and Gome, and there are significant differences in commodity operation and supplier management compared to Suning and Gome.
Faced with the frequent price wars in the domestic home appliance market, Yamanashi stated that Yamada Electric will utilize the group procurement advantage and strive to offer prices lower than those of Gome and Suning. Our reporter learned that 50% of the product categories in the Yamada Electric store in Tianjin belong to Japanese products.
Yamanashi, President of Yamada Motor Corporation, stated that in the next three years, five stores will be opened in China, and the operating status of the already opened Shenyang store exceeds expectations, hoping to achieve profitability within the next two years.
In the Chinese home appliance retail market, Suning and Gome occupy about 20% of the market share. Against this backdrop, Best Buy, the world's largest home appliance retailer, had to abandon its traditional practices in the United States after entering China for many years, and in early 2011, closed all its self-operated stores in mainland China.
Under the "Su Mei" pattern of the Chinese home appliance retail market, a new challenger has arrived.
Starting from founding an individual electrical store in 1973, after 38 years of development, Yamada Electric has grown into Japan's largest home appliance retail enterprise. As of March 2011, its sales reached 2 trillion 153.2 billion yen.
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