Appliance retailer eyes overseas expansion

Updated: 2011-03-25 15:24

By Hu Haiyan (

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Beijing — Suning Appliance, China's largest home appliance retailer, plans to step up its efforts to tap the overseas market.

Zhang Jindong, the president of Suning, told China Daily that "it is natural for Suning to gear up on the international market, especially in developed countries, where per capita consumption is much higher than that of the Chinese mainland and the potential is great".

"Taking Hong Kong and Japan as bases, Suning will continue to expand its overseas market," Zhang said.

"When it is mature, Suning will expand its business in other developing countries, such as Southeast Asian countries, and in developed markets such as the United States, by opening new outlets or conducting merge and acquisitions with the local enterprises."

In August 2009, Suning took its first step of internationalization by becoming a shareholder of Laox, a Japanese retailer founded in 1930, which has 10 stores selling appliances, computers, telecommunications products, animated games, toy models and musical instruments. Suning operates 23 stores in Hong Kong.

But Zhang didn't say how many stores Suning plans to set up in overseas markets, but it is understood the company plans to set up four stores in Japan shortly.

"The international market is full of opportunities, and the key point to successful overseas expansion is our own ability," he said.

"Although Suning is regarded as a large company by many people, we are still young and face a big challenge. We are short of talent with global vision."

"We will not explore the international market for the sake of seeking a label of internationalization, and we will choose the most prudent and suitable way and prepare for the opportunities to come."

Lu Jinyong, director of China Research Center for Foreign Investment with the University of International Business and Economics, said "it is good for home appliance companies to expand their business overseas, signifying the further opening-up and more fierce competition of Chinese retailing market".

"Home appliance companies entering into the foreign market can provide them with opportunities to learn some overseas advanced experiences and set up high-end image among the domestic consumers," he said.

Suning started 20 years ago with a 200-square-meter air conditioning store in Nanjing, in East China's Jiangsu province. It now has 1,324 stores in more than 300 cities in China, employing more than 120,000 people.

Zhang said Suning is now planning to set up 370 more stores – and enter 32 more cities – on the Chinese mainland this year as part of its plan to establish another 1,000 stores over the next three years. It also intends to build 60 additional logistic centers across the Chinese mainland.

Last year, Suning's operating revenue increased to 75.51 billion yuan ($11.5 billion), a 29.51 percent increase over the previous year. Its net profits hit 4.01 billion yuan in 2010, a year-on-year increase of 38.82 percent.


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