Abstract

The development of commerce in China has experienced great change from

more than one-century department store commerce to fast growing chain commerce.

The chain commerce appeared early in electrical appliances chain commerce，among

which Gome and Suning are called the pioneers. As the leader of chain commerce,

Gome and Suning only use less than two decades to go beyond the old-brand

department stores with hundred-year history in China. Their expansion and

development speed has reached the level that other commercial corporations couldn’t

achieve.

Taking a wide view of development process of Gome and Suning, to analyze

their development strategy and management is exactly the purpose of this paper.

There is a lot of research of these two corporations, but most of the research is from

the angle of management. This paper lays particular emphasis on from the angle of

finance and reveals their successful mystery through the analysis of Gome and

Suning’s financial reports. In the meantime, this paper points out problems these two

business enterprises face at present and gives the development suggestion. It will

certainly inspire other enterprises for their management decision and operation.

The selected samples are the financial data and the stock market transactions

from 2004 to 2007 for listed companies. The ratio analytical method, horizontal

analytical method and lengthways analytical method are adopted to carry on the

investigation in financial reports of different years.

The empirical research shows that Gome and Suning take up large quantities of

fund from upper suppliers to acquire the extension of scale and use low purchase cost

and low sales price strategy to acquire the competitive advantage. This kind of

business management has some problem. As to it, this paper carries on deep analysis

and provides the development suggestion to the problems existing.

This paper is divided into four parts. The first two chapters are the basis of this

paper. Chapter One gives an overview of the research background, purpose and

significance, ideas and methods, and the process of data collection. Chapter Two

introduces the details of researched objects. Chapter Three is the point of this paper. It

introduces the financial situation of researched objects, analyses the financial ratios of

the researched objects and discusses the relevant financial theories. Chapter Four is

the final part .It points out the problems in the objects and some specific

countermeasures to solve the problems.

Keywords: Gome, Suning, Financial Statement, Analysis of Operation