- Chinese Smart Retail Giant Posts RMB 4.21 Billion Profit for 2017 -
NANJING, China, March 1, 2018 /PRNewswire/ -- Fortune Global 500 company Suning.com (002024.SZ, formerly known as Suning Commerce) – China's largest online-to-offline (O2O) smart retailer – has announced Omni-channel sales of RMB 243.203 billion (approximately $38.433 billion1) in 2017, up nearly 30 per cent year-on-year, and a net profit attributable to equity shareholders of the company was RMB 4.210 billion (approximately $665.297 million), with an increase of 497.66 per cent.
The figures represent the best performance for the Chinese company since embarking on its O2O business model in 2009 and reflect the success of Suning's smart retail strategy, with rapid and continuous growth in its revenue scale and net profit margin both online and offline.
At present, pure-play traditional and e-commerce retailers are facing to a complex of challenges such as the rising cost of online traffic, limited merchandise category and coverage area of physical stores. The industry is building a full-time, multi-scenario and high-efficiency business model to provide such solutions. Suning.com, the retail subsidiary of Suning Holdings Group, who focuses on traffic management, merchandising and affiliate marketing, optimising customer experience and improving Omni-channel operation capabilities, has taken the advantages to meet new opportunities in 2017.
During the reporting period, total online physical trading volume of the company was 126.696 billion yuan (tax included), up 57.37 per cent year-on-year, and the number of monthly active Suning.com APP users increased by 105.73 per cent since the start of the year. In December 2017, the number of orders generated by Suning.com APP reached over 89 per cent of the total online.
As of 31 December 2017, Suning owns a total of 3,867 physical stores comprising a total area of 5.093 million square meters. It is notable that through internet technology application, data-oriented management and strong quality control, the business performance of Suning stores continues to improve. Sales revenue grew 4.17 per cent in the firm's mainland China stores with operating efficiency of Suning direct-sale stores jumping 34.90 per cent.
By the end of 2018, with the strategic partnership with 300 well-known real estate developers domestic and abroad as Wanda, Evergrande and Sunac, Suning plans to add a further 5,000 physical stores to its rapidly expanding portfolio, all being connected to its online presence and covering diversified consumption scenarios including Suning cloud stores, direct-sale stores, fresh food supermarkets and convenience stores, Redbaby (maternal and child supplies stores), Suning Sports and Suning Cinemas. It says 15,000 Internet-connected stores will open within three years then totally 20,000 in operation by 2020.
In addition to the substantial growth of its retail subsidiary, the 'Logistics' and 'Financial Services' businesses of Suning also continued rapid growth. In 2017, Suning Logistics revenue (excluding Tian Tian Express) increased 135.76 per cent. It now has a total area of 686 million square meters of warehousing and related facilities, with 20,871 express outlets. Suning Financial Services (payment business, supply chain finance and etc.) saw the overall size of transactions increase by 129.71 per cent. In 2017 Suning has intended to introduce external strategic investors and partners such as YF Capital and SZVC Capital for related businesses development, demonstrating the independent expansion and funding capability of Suning's logistics and financial services.
1 Calculated at an exchange rate of 6.328 RMB to 1 USD
Founded in 1990, Suning is one of the leading commercial enterprises in China with two public companies in China and Japan respectively. In 2017, Suning Holding ranked second among the top 500 private-owned enterprises in China with annual revenue of 65.7 billion USD (412.95 billion RMB). With the mission of "Leading the Ecosystem across Industries by Creating Elite Quality of Life for All", Suning has strengthened and expanded its core business through eight vertical industries: Suning.com, Logistics, Financial Services, Technology, Real Estate, Media &Entertainment, Sports, and Investment, among which Suning.com was listed on the 2017 list of Fortune Global 500.
For more information see www.suningholdings.com