Chinese air conditioner maker Gree Electric Appliances, Inc. of Zhuhai (SZSE: 000651) is fueling expansion through attaching more importance to business-use air conditioner products and looking for a diversified operation.
It upgraded a flagship store in Shanghai, the financial hub of China, into a super flagship one days ago and in line with an insider, this was a strategic move it took to upgrade sales channels cross the country.Available data shows that it has about 400 stores in the municipality currently and among them, 20 ones are flagship stores and 16 ones are experience stores for business-use air conditioners. It has about 15,000 stores in the country and aims to raise the figure to 20,000 in the future. In the meantime, the proportion of large flagship stores as well as experience stores will be raised sharply. The insider reiterated that it saw the average sales price of air conditioners reach about CNY 4,000 per unit currently, compared to about CNY 2,000 per unit in the past. It wanted to build itself into a first-tier brand and in order to achieve the goal, it would launch more high-end products in the future.
It for the first time saw sales revenue exceed CNY 100 billion in 2012. Dong Mingzhu, chairman and president of it, proposed that it would do its utmost to maintain an annual sales growth of 20 percent in the future. The family-use air conditioner sector has been almost saturated, thus it has become a focal point how it will achieve the long-term goal. People in the know disclosed that it attached more importance to business-use air conditioners and such products would help it achieve the goal. Xu Junming, a top executive responsible for the operation of business-use air conditioners at it, said at a refrigeration expo in Shanghai not long ago that potential of the business-use air conditioner sector was huge and the profitability was strong. Thus, it would attach more importance to tapping the sector in recent years.
An industry observer pointed out that the sales revenue it reaped from business-use air conditioners in Shanghai was CNY 400 million last year and the figure was expected to hit CNY 600 million this year. And that seized in the domestic business-use air conditioner sector was expected to touch CNY 25 billion.
In the meantime, it is looking for a diversified operation through subsidiaries and in its stores across the country, not only air conditioners but also other home appliances including water softeners and purifiers and air cleaners are sold currently.
