The Change From Suning Appliance To Suning Yun:Evolution Or Involution?

With the development of information technologies in 21 st century,E-commerce has gradually covered all areas of people’s life.Many offline retail enterprises have realized the huge opportunities brought by it and began to provide on-line service.However,most of the offline retail enterprises met their Waterloo although they invest huge amount of money on this field.The operating performance continued decline and ultimately suffered a large loss.As a result,physical retail enterprises start to review the benefits and drawbacks from the E-commerce model.At present,the research on Internet retailing is still at the exploratory stage.The achievements are mainly focused on the impact of E-commerce on retail industry,the problems existing in online retailing and how to enhance the competitiveness of Internet retail enterprises.There are few systematic studies on the transition for E-commerce of offline enterprises.Taking financial performance analysis as the main method,the paper studies the transition from offline retailing to E-commerce of Suning Corporation,the most representative retail enterprise in China.As the largest home appliance retail enterprise in China,Suning has been maintaining a good momentum of development since its establishment and has once accomplished wonders in gaining profits in Shenzhen Stock Market.In 2011,Suning officially launched itsE-commerce platform Suning.com,which expanded its business scope to the whole category.In 2013,Suning changed its name to Suning Yun and announced the integration of online and offline service.However,Suning’s financial performance deteriorated sharply after the transformation,the previous high growth was replaced by year-on-year loss,causing huge concern.This paper chose Suning’s financial and business data from 2004 to2016,studying the profitability and profit quality,financial guarantee degree,asset operation efficiency and growth dimension of Suning.Analysis found that after Suning set foot in E-commerce,its profitability and quality of earnings fell sharply.The fund was difficult to ensure the effective operation of the Company.Things also worsened in terms of operational capacity and growth.This failure mainly lay in 3 aspects.Firstly,the Company went in for grandiose projects so that lack of focus,the business collaboration is weak.Secondly,large amount of capital investments didn’t pay off,on-line business was still its soft rib.Third,as a offline retailer,Suning lacked experience in E-commerce operation,which caused a substantial increase in expenses.In view of the above mentioned reasons,with the purpose of improving E-commerce profitability,the writer suggests Suning to develop a clear strategic positioning,strengthen the development of the main business,enhance the online platform operating capacity and attach more importance to theuser experience,as well as fully using new technologies to improve the quality of business,so as to promote the transformation of growth way of the company.In addition,through the study of Suning case,the paper also hope to offer some references for other offline retail enterprises who want to carry out E-commerce.