Suning targets online sales growth
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Suning Appliance Co yesterday said it aims to boost its online sales to 30 billion yuan (US$4.4 billion) within three years and capture up to 20 percent of the online electrical appliance market.
Its aggressive plan will heat up competition in the emerging online appliance market, which is now dominated by consumer-to-consumer portals such as Taobao.com.
"The online shopping market is a treasure with great potential, especially the business-to-consumer sector, as retailers in this sector account for 80 percent of the online home appliance market in the United States," Suning said in a statement.
Suning e-go, which partners IBM, Cisco, Baidu and Sina, has established a team of 1,000 members to operate the online system and hopes to become a top online seller.
"The goal is reasonable because Suning boasts mature logistics, delivery and after-sales systems, which are the main obstacles for online retailers to grow," said Zhang Chonghui, an analyst with iResearch Consulting Group. "The Suning brand will also help the firm to expand rapidly as it is seen as a guarantee of quality and credibility."
The online electrical appliance market more than tripled from a year earlier to 40 billion yuan in 2009. The figure is expected to double to 80 billion yuan this year, according to research company GFK Group.
Suning's online platform earned less than 10 billion yuan last year, while the firm made an estimated 60 billion yuan in sales in 2009.
Its shares gained 0.16 percent to 18.43 yuan on the Shenzhen Stock Exchange yesterday, while the Shenzhen Composite Index declined 1.15 percent.
