Can Gome Be A "Supporting Actor"?

The marriage of retail giants has always been one of the ways for the industry to embrace and keep warm. Ali and Suning cross shareholding is an excellent case. A lot of ways of engaging in a different way of "joining the stock" and linking up with Gome have also attracted the attention of the market recently.

In the "adverse circumstances", Gome began to seek "alliance" constantly, in order to reverse the declining trend of performance.

One month after the Jingdong's entry into the Jingdong, Gome reached a deep strategic cooperation with another big business tycoon.

Gome retail (00493.HK) announced that the company issued a total of 200 million US $17 convertible bonds to PDD.Nasdaq on April. In April 20th, Gome retail opened 32.88% in early trading.

At the same time, Gome and many companies announced the completion of a comprehensive strategic cooperation, the Gome retail products will be a lot of competition, the brand will be connected to the large number of "10 billion subsidy" plan.

This is also a signal to us, for the current household appliance retail industry, has said goodbye to the "bloom" style of growth, but between the oligarchs, for the rest of the household electrical appliance retail industry, no one can afford to make mistakes again, the market has not given them the opportunity to make mistakes, if the next card is not good, really. It may be eliminated by the market.

Gome has been in jail for more than a decade after its soul was in prison. In the past decade, the appliance retailing industry has undergone tremendous changes.

However, it is fortunate that Gome retail is still alive, and there is still a chance to turn around, but there is little time left for Gome.

　　 The declining Gome

Gome was founded in 1987. It was originally a small shop in Beijing less than one hundred square meters. Since its inception and adheres to the principle of "small profits but quick turnover", the scale has expanded rapidly and was listed on the stock exchange of Hong Kong in 2004.

The first attempt to try new modes of supply and marketing is to get rid of middlemen, directly contact with manufacturers, enhance bargaining power with a huge sales network, and lower the price of products.

In the field of home appliance retailing, Gome and suning.com (002024.SZ) once fought for hegemony. Both companies landed in the capital market in 2004, and the scale of revenues was equal.

However, it didn't last long. At the end of 2008, Wong Kwong Yu, the founder, was suddenly taken away by police. This is the turning point of Gome's operation.

Since then, Gome's performance has been running rapidly, not only being caught up by many years' competitors, Suning, but also surpassed by the electronic business platform represented by Tmall and Jingdong.

At the same time, for a long time, Gome still put its main battleground in the next store, the number and scale of its opening shop, and online sales as a supplement to store sales and embarrassing position.

Gome is still addicted to offline stores when its competitors are in full swing. When the competitors shout "ALL IN wireless", Gome is fighting against it.

In the field of traditional home appliance retailing, Gome has been a leader in the industry, and its offline channel network is also in the top position in the industry. Just after missing the online business bonus era of the Internet, Gome's advantage is no longer there, and it has gradually declined in recent years.

With the offline retail sales declining, the impact of online retail development is not only increasing the operating costs of the store, but also the profit situation has declined.

This year, however, affected by the epidemic, Gome's large number of offline stores have resumed business, but the performance before recovering to the epidemic still takes time, making it difficult to find a new outlet and break through quickly.

　　 Combine marriage and make more efforts to complement each other

As the elder brother of home appliance retailing industry, Gome's core advantage lies in the entire channel network under the line, that is, the more than 2000 stores covering the core business circle of the country, and the commodity richness and price competitiveness brought by the supply chain system accumulated over the years.

The sudden outbreak of pneumonia accelerated the strategic adjustment demand of Gome to the online business. However, online channels are obviously not the strengths of Gome under the traditional offline retail business.

At this time, to cooperate with many new business owners and complement each other is undoubtedly a shortcut to speed up the integration of online and offline businesses.

The epidemic also has great impact on offline business, and online business has little advantage, especially in the face of Jingdong and Suning, the better strategy is to introduce strategic partners.

Gome online is a short board, many rely on this start; many services under the line is short board, Gome online has great advantages. Gome business feels stagnant, but the trend is much higher, and the brand recognition is low. Gome's many old brands can still trust.

Gome will rely on its powerful logistics system to build a logistics distribution system for many platforms to build up a large power distribution system. It will effectively compensate for many short boards. For many spells, Ali has Suning, Jingdong has five stars, many spells are needed, and Gome also needs Gome.

As for Gome, although it has been the leader of domestic appliance chain enterprises, it is not easy for Gome now to be affected by the electricity supplier.

And in the two tier market, Gome retail sales have shrunk to the latest HK $15 billion 700 million from the market capitalization of 10 billion years ago.

And a lot of business as a new hot business, after the listing revenue growth rate far exceeds the market expectations and therefore sustained. And its market value reached US $51 billion 700 million, ranking behind Alibaba and Jingdong.

One is a down and out industry, one is a new upsurge in the market, and the marriage between the two is quite significant.

But the market is more concerned about whether the two complement each other and whether they can really produce chemical reactions.

In short, this marriage can not completely cure many brand anxiety and the flow of hunger and thirst of Gome, but to some extent, it has given the two sides the opportunity to move forward.

　　 Strong combination of retail electricity providers

10 years ago, Gome, Suning and Wuxing electric appliances were the three giants of China's electrical appliance retailing industry. 10 years ago, Jingdong might not have been in the eyes of Ali.

Once, Gome Suning staged many years of "hegemony in the US and the Soviet Union" in the appliance market, but because of Wong Kwong Yu's imprisonment, the formation has changed. Along with Ali's stake in Suning, it became the second largest shareholder, and Ali's entire platform drains suning.com's online platform.

Suning is also facing huge "baggage" of offline stores, but because the online platform has Ali's "backing", it can at least drain its platform for shipment.

After many years of exploration, suning.com's intelligent retail mode has entered a stage of rapid development, and its business format has been developed from home appliance 3C store to mother and baby, supermarket and community convenience store.

On the basis of retail business, Suning extended its logistics and financial services. In store Internet and data construction, we use "store +", "gold mine" and other data marketing products to improve Ping efficiency.

In recent years, the integration and transformation of traditional household appliance retailers has accelerated.

Take five star electric appliances as an example, through the unbounded retail strategy cooperation with Jingdong, the strategic transformation of domestic brand star GMA and life proposal shop, five star Collection House will be carried out.

In addition, in the home appliances circle, a large number of home appliances head enterprises, such as the United States, Haier, Hisense, and GREE, Changhong, are promoting the transformation of the household electrical appliances agents who have worked for many years to the operators, and promoting the upgrading and expansion of the franchise stores.

Therefore, the situation facing Gome is "back to the belly". If you don't choose to dance with others more often, you can only look at the backs of others and go farther and farther.

At present, the three giants of China's electricity suppliers and the three big electrical appliances have already joined the ranks to carry out a series of strategic cooperation, mutual shareholding, entry and other cooperation modes, and how the retail pattern will change.

Ali Jingdong electricity supplier duopoly, Suning Gome duopoly era may be shaken, for many and five-star appliances, the vertical and horizontal is also very important.

But what we can expect is that there will be a reformative change in the sales channels of the home appliance retailing industry.

　　 Can Gome become a "supporting actor"?

Gome and many 22 cooperation, short board complementary, is likely to support the home appliances version of the "three pillars" trend, if the United States can not quickly seize the rest of the time, waiting for Beijing East alone, it is difficult to have the opportunity to turn over.

Although they are all changing, the gap between Gome retail and suning.com is becoming more and more obvious. It is no longer an order of magnitude.

Gome puts down its "posture" and wants to borrow more and more to realize "electric business dream" and wild hopes for the sinking market.

Over the years, by entering the major electricity providers to test the water separately, and finalized a lot of deep cooperation with the fight, is also looking at Gome's online traffic entry and a lot of subsidence market results.

Gome has been trying to layout the sinking market, but the mode does not seem to be clear, and many of them rely on the sinking market to "start". Gome can import with lots of traffic to achieve growth in performance and improve the layout of the sinking market.

Though the store that was once proud of Gome was overtaken by its old rivals, it was left behind by the Internet wave.

But it is undeniable that Gome as a retail giant under the line, after 33 years of accumulation, its supply chain has been integrated through the integration of user terminals, sales terminals, more than 2600 stores nationwide, millions of shopkeepers, warehouse distribution logistics and after-sales maintenance service system, to create a unified sales, storage, delivery and maintenance, maintenance of the whole chain retail ecosystem, which is undoubtedly in the market. And has already had some influence.

In the era of the Internet, hugging traffic and expanding online channels, although it is difficult to turn over the market, Gome is now integrating from a single channel to a full channel, from a pure store operation, and has opened up a cooperative strategy under the online and offline business.

Embrace the emerging giants and lay the foundation for their next defending championship. It has to be said that the once obscure Gome seems to have found a clearer path.