BUILDING NATIONWIDE CHAIN NETWORK WITH YANGTZE RIVER DELTA AS CORE
Since the opening of our first chain store, Nanjing Xinjiekou Store, over 20 years ago, the Group has successfully opened 29 self-owned stores with a total gross floor area of 1,766,394 square meters and a total operating area of 1,214,962 square meters as at 31 December 2015. These stores span four provinces and one municipality, namely Jiangsu, Anhui, Shaanxi, Yunnan and Shanghai, covering 18 cities including Shanghai, Nanjing, Nantong, Yangzhou, Changzhou, Xuzhou, Taizhou, Huai’an, Yancheng, Suqian, Liyang, Danyang, Kunshan, Wuhu, Ma’anshan, Huaibei, Xi’an and Kunming.
Leveraging on our leading position and strong competitive advantages in Jiangsu Province, the Group will continue to reinforce our market leadership and presence in the regions of Jiangsu, Anhui, Shaanxi, Yunnan and Shanghai by establishing comprehensive lifestyle centers with potential for long-term competitive strengths and business growth. Meanwhile, the Group will gradually build up a nationwide retail chain network by actively exploring opportunities in the first- and second-tier cities as well as tapping into the third-tier cities where there is immense potential for growth.
ADHERING TO THE STRATEGY OF DEVELOPING MAINLY IN SELF-OWNED PROPERTIES WITH PREMISES OF LONG-TERM LEASES AS AN ALTERNATIVE
The Group’s chain stores are situated at prime shopping districts in their respective cities and the Group adheres to its core development strategies of developing mainly in self-owned properties. As at 31 December 2015, approximately 61.9% of the total gross floor area of our stores is located in self-owned properties. In order to capture opportunities for development, the Group also secures high-quality properties by entering into long-term leases for ten years or longer, hence minimizing the impact of rental increase on our department stores’ operation. We also have leases with rentals calculated on the basis of a percentage of the relevant store’s sales proceeds.
PROMOTING COMPREHENSIVE LIFESTYLE CENTERS
Capitalizing on the development trends of the retailing industry targeting on mid-to-high-end market segments in China, the Group accelerated its strategic transformation from fashion department store to “Comprehensive Lifestyle Center”. The Group has introduced various functional and innovative amenities, such as dining, entertainment, gourmet supermarket G-Mart, aquarium, beauty and personal care, hair styling, cinemas, preschool education and comprehensive automobile services in addition to our core function as an international fashion department store, and has vigorously introduced specialty brands and continued to optimize merchandise mix in order to further enhance our competitiveness and drive sales and profit growth. As at 31 December 2015, the Group opened 10 comprehensive lifestyle centers with a total gross floor area of 1,035,474 square meters. The operating area of these comprehensive lifestyle centers accounted for 32.7% of the Group’s total operating area.
ENRICHING CONTROLLABLE MERCHANDISE RESOURCES AND IMPROVING PROFITABILITY
Through co-operation with exquisite brands by way of buyout, distributorship and equity investment, the Group offers customers a variety of unique merchandise with high value under a rich portfolio of brands to meet target customers’ needs and enhance the Group’s profit margin.
DEDICATED TO PROVIDING TARGET CUSTOMERS WITH HIGH QUALITY AND INNOVATIVE VALUE-ADDED VIP SERVICES AND COMPREHENSIVE ONLINE AND OFFLINE SHOPPING EXPERIENCE
The Group endeavors to enhance the quality and enrich the content of VIP customer services. The Group’s VIP membership card has covered online and offline comprehensive lifestyle services in various functions including fashion shopping, dining and leisure, hotel services, high-end second car sales and comprehensive automobile services, an iPoints reward points redemption platform and “金鷹購Jinying.com”. The Group also fully utilizes omni-channel marketing through the mobile phone application “goodee mobile App” (掌上金鷹), the WeChat social network platform and the “Electronic VIP Card” to build and develop marketing channels with high efficiency and low cost, so as to effectively deliver real-time information about sales promotion to customers, enhance customers’ shopping experience and allow customers to enjoy various VIP value-added services more easily and thus further stimulating their shopping sentiment. As at 31 December 2015, the “goodee mobile App” has registered over 4.80 million downloads, representing an increase of 140% compared with those at the end of 2014, and had 1.21 million VIP customers connected their VIP membership cards with the App. The App is the most active mobile application in the department store industry in China. At the same time, the Group has successfully secured over 2.48 million loyal VIP customers. During the period under review, spending by VIP customers accounted for 56.3% of the Group’s total gross sales proceeds.
LOCALIZED OPERATIONAL STRATEGIES WITH WORLDWIDE MANAGEMENT PERSPECTIVE
The Group appreciates the dedication and contributions of its employees, and fosters their capabilities, competence and worldwide perspectives by conducting regular professional training sessions and overseas study trips for both the management and employees. The Group also implements localized management systems for each local market. For each of its stores, the Group recruits local talents to form a management team so that the Group can utilize their local knowledge on the respective markets. As at 31 December 2015, the Group has approximately 6,200 employees.