In two months, Fortune magazine will probably announce the ranking of the world's top 500 enterprises in 2011. Suning Appliances and Gome Appliances are very likely to appear for the first time.
The "Top 100 Chinese Chain Enterprises" report published by the China Chain Operation Association in March showed that in 2010, Suning Appliances (including non-listed departments) achieved a revenue of 156.2 billion yuan, while Gome Appliances (including non-listed parts) followed closely behind with 154.9 billion yuan. The 400th place in the Fortune 500 in 2010 had a revenue of only 21.758 billion US dollars.
The Billion Dream Sprint
Zhang Jindong and Huang Guangyu have long hoped for this goal. In March 2005, Huang Guangyu announced in Shanghai that Gome Appliances would enter the Fortune Global 500 by 2008. In June of the same year, Zhang Jindong also declared that the company would enter the Fortune Global 500 by 2010.
In January 2009, Zhang Jindong emphasized in Shanghai to the "First Financial Daily" that the goal of entering the top 500 by 2010 has not changed, and the pace may even accelerate. However, their names did not appear on the mid-year list in 2010. Gome seemed to break its promise, and Suning was at a critical point. However, the late entry seems to have no effect on their growth momentum.
The term "wild sprint" can describe the two 3C chain giants' pursuit of the billion scale. According to the data from the China Chain Operation Association, in 2005 when both made their declarations, Gome Appliances had an annual revenue of only 4.984 billion yuan, mainly occupying Beijing; Suning Appliances had a revenue of only 3.972 billion yuan, being a local chain powerhouse in Nanjing. That is to say, in the past five years, Suning Appliances' revenue has grown 38.32 times, and Gome has grown 30 times.
Many people think this is purely a success of individual heroism. But according to our newspaper's years of tracking reports, Zhang and Huang, including Chen Xiao, the founder of Yongle, could be said to have encountered a good time, which was due to the circumstances. In the history of Gome and Suning's development, there was a period of grassroots growth, roughly concentrated in the late 1980s to the mid-1990s.
It was not until the mid-1990s that the strength of China's home appliance manufacturing industry, especially the color TV and air conditioning industries, led to the channel model under the traditional system facing difficulties, prompting Zhang and Huang to transform from guerrilla fighters into professional channel regular troops.
In the following few years, Gome and Suning began their chain journeys, moving from tens of millions in revenue to breaking through the hundred million threshold. In 2002, Suning Appliances' revenue was approximately 2 billion yuan. Zhu Jiagui, vice general manager of Shanghai Suning Appliances, recalled to our newspaper that he felt quite big at that time, but now the Shanghai Zhongshan Park flagship store alone generates more than 1.2 billion yuan in annual revenue.
The chain process of Gome and Suning is also a typical path of the strengthening of China's retail industry. It has standard and replicable characteristics, and the implicit quasi-financial survival model has fully demonstrated strong scaling effects. Starting from 2002, it seemed like countless home appliance chain stores spread across China's cities and towns overnight. Gome and Suning were the most aggressive, creating records of opening more than one new store per day on average. During these three years, the growth rate even exceeded 100%.
Crisis Prevention Under the Billion Scale
However, interestingly, in recent years, although Suning and Gome still emphasize scale and recently announced the highest annual store-opening targets in their history, returning to the situation of opening a new store every day on average, their discourse does not seem as enthusiastic about discussing scale as before, and they rarely mention the goal of entering the Fortune Global 500 in front of the media.
Suning and Gome talk more about service, single-store output, and profit performance, as well as operational management improvement, model adjustment, and backend...
Teacher Jie introduced www.zp-nmg.com