Success for Suning: Channel + Supply chain + Logistics
COVID-19 and China

►From offline domination to its online takeover, Suning has built a compound retail ecosystem with the most comprehensive commercial models.
►The in-depth integration with Wanda Department Stores and Carrefour, along with the complete logistics system, powered the supply chain system with excellent interactions between segments.

Over the last decades, the e-commerce business has grown rapidly, with the active[sl1]  users of e-commerce reaching 1 billion. On the other hand, the industry is transforming from an incremental market to a stock market and is entering into an era of refined operation. Among the companies struggling towards effective expansion and transition, Suning, a benchmark entity in the e-commerce industry, has found its own ways to break out.

From offline domination to its online takeover, Suning has built a compound retail ecosystem with the most comprehensive commercial models. Through cooperation with RT-Mart, Carrefour, and Wanda Department Stores, Suning successfully integrated the entire operation map with the highest market shares and achieved a large run-up of 115.44% in groceries sales in 2019. The pandemic also brought some opportunities for the company, which speeded up online consumption and stimulated demand for fresh products. Suning even opened around 500 offline stores to support the entire retail ecosystem. Besides, promotion and marketing through live podcasts brought a substantial growth in online orders and a significant increase in the adhesiveness of customers. 

The in-depth integration with Wanda Department Stores and Carrefour has powered the supply chain system for Suning, Currently, the company has a well-rounded web channel, including the online Supermarket option, offline Carrefour, Suning Fresh and Suning stores, helping it reach a scale economy in purchasing. In order to better build the supply chain and enrich the categories online, Suning has launched multiple policies to attract more merchants. 

The logistics system provides better interactions between every segment on the supply chain. Currently, Suning has a service network combining experience and efficiency, with 12.1 million sq. m in storage area and 25881 branches. During the pandemic, Suning became one of four logistics companies that were still under operation. Furthermore, in order to forge a better service network, Suning invested heavily in building its logistics system with TTK Express integrated. The outstanding logistics network has successfully speeded up online grocery consumption with a year-on-year surge of 167.99% in the first quarter of 2020. 

Suning, founded in 1990, is a leading e-commerce company and intelligent retail service provider in China. The mantra for Suning is to become a Chinese version of Amazon and Walmart at once. The company was listed on Fortune Global 500 and ranked top 1 in retail business in Valuable Brands China 500 list in 2019, with a market capitalization of CNY 269.2 billion. After launching its IPO in 2004, the company showed more power and speeded up its expansion and transformation, winning recognition from investors. In 2011, Suning set itself a 10-year-long technology development strategy, seeking to explore the cloud service model – it has now generated an intelligent e-commerce retail platform. 

In the first quarter, Suning experienced a jump-up on product sales to CNY 88.7 billion, and the percentage in the entire sales from online selling increased to 68.84%. For the year 2019, Suning achieved revenue of CNY 269.2 billion, while net income attributed to listed shareholders was CNY 9.43 billion, and product sales were CNY 378.7 billion.

Editor: Luke Sheehan

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