| China once promised that we would fully open the direct selling market to the world in 2015 when accessing to the WTO in 2001. In 2005, China began to implement the "Direct Selling Regulations" and "Regulation on Prohibiting the Pyramid Selling" to afford direct selling develop rapidly. China has been the second largest direct selling market by 2013, just after USA. By the end of the year 2015, there have been 71 companies by law. All the records indicate that the development of China’s direct selling industry remains steady increase in scale, performance and other aspects. However there are some problems. As far,the sales of cosmetics and some products about health care are the largest, while the health care products have vital link with medical biotechnology.What is more, medical biotechnology has a profitable future.With the new medical reform, the population aging problem, the "two children policy" and the intention to release internet sale of drugs and other related policy implementation, medical biotechnology industry will experience plenty of development opportunities.This paper first selects the medical biotechnology industry, then selects A direct selling biological company as a representative company who adopt direct selling modal in medical biotechnology industry. Based on the research of A direct selling biological company, this paper combined the strategic analysis, accounting analysis and financial analysis and prospect analysis in Harvard Analysis Framework with the actual situation of this company and conducted a detailed analysis. In the strategic analysis, this paper adopted PEST analysis, Porter’s five forces and SWOT analysis to analyze the specific outside and inside environment as well as industry environment with strength, weakness, opportunity and threat. In accounting aspect, through horizontal and vertical comparison, the focus is on asset quality, earning quality, cash flow and R & D expenditures. In the financial analysis, this paper analyzed the profitability ratios, liquid ratios and the working capital, meanwhile compared these ratios with Non-direct selling biotechnology Company named Jilin Aodong. At last, in the prospect analysis, this paper made strategic forecasting, financial risk prediction and financial analysis for A direct selling biological company.With framework analysis, this paper found that the A direct selling biological company is facing both outside and inside risks, such as strategic risk, operation risk, operational risk and financial risk. In the near future, there will also be too many challenges, financial risks and operational stress in the development of A direct selling biological company. In face with all these problems, A direct selling biological company needs to adopt strategic analysis to encourage technological innovation, prevent the information risk and make the financial warning management system and budget system, and after all, it can respond to the business management pressure actively.Though the thorough comparison between A direct selling biological company and Jilin Aodong, this paper found that with the gradual opening of China’s direct selling market, the direct sales of medical and biological product also improved rapidly. However, there are also some problems in the development process of direct selling. To deal with these, we need to increase our investment in research, encourage scientific innovation and strive to improve the competitiveness of domestic medical and biotechnology companies in the international market. We also need to constantly optimize the industrial structure, to accelerate the business model innovation, to promote the rapid development of the direct selling business model of the medical biotechnology industry, to deepen the company’s content-type development, to reduce internal friction, the formation of a scientific and rational optimization configuration, and together to have the greatest positive capability. |
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