Suning, 15 Years Earned 2.5 Billion Wealth Legend: Part 3

Voluntary loss of 40 million turning point

In 1995, the Chinese household electrical appliance market oversupply situation, many manufacturers to directly infiltrate the retail market. To this end, Zhang Jindong gradually reduce the wholesale business, began self-built retail terminals, selling home appliances also gradually increase from a single integrated air conditioning appliances. In 1996, Suning entered the market in Yangzhou, Nanjing signs began to move out of their home electrical appliance chain to explore the road.

In 2000 the Suning Appliance, is a turning point. This year set up a single air-conditioning Suning stop boutique, a comprehensive restructuring of large integrated electrical stores, and shouted "three years to open 1,500 stores nationwide," the chain into slogans. When put into use is developing Nanjing Xinjiekou stores, as a sign Suning transition.

Suning Nanjing Xinjiekou shop at Suning Appliance building, the largest building in the business district of Nanjing Xinjiekou business district center, a "golden construction." Someone advised Zhang Jindong early on this floor can be leased for at least one year a net profit of 30 million yuan, Zhang Jindong but firmly said: "even if a loss 40 million, Suning have to do household electrical appliance stores." results in 2000, 2001, the stores Suning input 20 million yuan.

"But this is developing into a new industry, build a team. There had been no decision, there would be no today is developing." Today, Zhang Jindong time proved the correct choice, the national chain Suning system also the rapid expansion: in 2001 an average of 40 days open a shop, in 2002 an average of 20 days open a shop, in 2003 an average of seven days opened a shop in 2004 on average five days to open a new store, and this year the first four months of Suning average two days to open a shop. Zhang Jindong had prepared a loss 40 million yuan opened Nanjing Xinjiekou store, has become the country's first shop selling household appliances, annual sales of 1 billion yuan.

"2000 we propose to the country out 1,500 shops, many questioned by the industry. Pressure was great, but now look back at the end of this scheme to achieve." Zhang Jindong tone was full firm.

Listing achievements capital Legend

"The new Fortune 500 rich list" of the view that the retail industry last year, China is rich wealth of the fastest population growth, per capita wealth of retail tycoons growth 308 percent, which is a model Zhang Jindong: Since 2004 Suning electrical listing, Zhang Jindong personal wealth steep 517%.

In fact, Zhang Jindong listed for the whole Suning preparatory for five years. On July 21, 2004, Suning Appliance SME board formally listed in the Shenzhen Stock Exchange trading. The day to 29.88 yuan Dow Jones expensive trading, the shares climbed all the way to the afternoon closing share was at 32.70 yuan, or 100.24 percent, and in the two cities to become the first high-value shares in Shanghai and Shenzhen. Zhang Jindong assets thus night more than 1.2 billion yuan.

After Suning China's stock market has been one of the first high-value stocks, shares hit record highs, topped 70 yuan mark, now rank first and 66.75 yuan highs remains. Zhang Jindong assets from the beginning of 1.2 billion yuan soaring listing to the present 2.2 billion yuan. With Zhang Jindong other assets, net worth of more than 2.5 billion yuan.

The U.S.A. largest home appliances chain enterprises BestBuy, in the 1989-1999 period of 10 years, its stock price up by 100 times. Global retail giant Wal-Mart in the 1980s to the 1990s, the stock has turned over 500 times. Currently the United States home appliances chain enterprises have insufficient 1000, BestBuy headed by the top three electrical control of the chain as much as 80 percent market share. Domestic appliances and circulation enterprises have more than 32,000, home appliances chain enterprises market share of only 6%, capital markets and retail markets to Zhang Jindong obviously leave a double room for imagination.

"Although objectively speaking, the annual sales over 20 billion yuan, Suning is a middle-corporate, but with the scale than I have in mind, Suning is but a small business." Saying this, the eyes appeared Zhang Jindong long-term and meaningful.

Source: 京华时报 Duan Zhimin May. 9, 2005

Link:
Suning, 15 Years Earned 2.5 Billion Wealth Legend: Part 1
Suning, 15 Years Earned 2.5 Billion Wealth Legend: Part 2
Suning, 15 Years Earned 2.5 Billion Wealth Legend: Part 3