As a traditional retailer focused on selling home appliances, Suning.com Co. Ltd. (Suning) grew quickly and became a leading retailer in China, dominating the market until the 2000s. By 2021, however, Suning was facing challenges, including fierce competition from e-commerce giants such as Alibaba Group Holding Limited, Jingdong, and Pinduoduo Inc. and from its upstream brand manufacturers. It also faced financial pressure in its core business due to aggressive expansion. Suning’s revenue, assets, and equity declined, and its net income, which had significantly declined since 2018, had been in the red since 2020. Should Jindong Zhang, co-founder of Suning, change the company’s current business strategy? How could Zhang use an omnichannel structure to ensure Suning’s sustainable growth?
苏宁易购: 管理扩张的挑战 Suning.com: Managing the Challenges of Expansion (Simplified Chinese version)
Yan Zhu, Jing Chen, Hubert Pun
Product #:W28597
Supplier:Ivey
Discipline:General Management
Setting:China, 2021
Subjects:
Industries:
Your Price:$10.54
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Learning Objectives
- 解释中国零售业的发展，概述线上和线下渠道之间的竞争和冲突。
- 描述上游制造商直销渠道的影响，并确定家电零售商在小城市和电子商务中扩展其线下业务所面临的机遇和挑战。
- 确定传统零售商的线下和线上渠道的利弊，并讨论推动电子商务渠道推出以及线下和线上渠道整合的因素。
The case discusses how a traditional retailer facing fierce competition from e-commerce giants and its upstream brand manufacturers should manage an omnichannel structure to sustain long-term growth. The case is suitable for undergraduate- and graduate-level courses in operations management, supply chain management, marketing, e-commerce, and strategy management, particularly in a section that discusses omnichannel. This case will also be helpful for classes on brand management and supplier relationships. After working through the case and assignment questions, students will be able to do the following:
- Explain the development of China’s retail industry and outline the competition and conflict between online and offline channels.
- Describe the impact of upstream manufacturers’ direct channel sales and identify the opportunities and challenges faced by a home appliance retailer in expanding its offline business in small cities and e-commerce.
- Identify the pros and cons of offline and online channels for a traditional retailer and discuss the factors that would drive the launch of an e-commerce channel and the integration of offline and online channels.