Suning to expand products beyond electronics

Wang Ran, the CEO of China eCapital Corporation, a private investment bank, said those recent moves by Suning showed that it may be looking to build a retail "super-system" that would resemble a combination of Wal-Mart and Amazon.

Suning didn't enter the fiercely competitive Chinese e-commerce market until August 2009.

However, it managed to fight its way into the top four e-commerce players last year, partly through a series of discount offers and promotions to lure customers.

According to domestic research company Analysys International, Suning had a 3.5 percent share of the business-to-consumer market in 2012, trailing Tmall's 44.1 percent, 360buy's 16 percent and Tencent Holdings Ltd's 3.8 percent.

However, analysts have warned it still faces significant challenges in taking on the biggest names.

Its warehousing and logistics systems need further development, and it may also need to develop its own technology rather than outsourcing its IT, said Li Chengdong, an e-commerce analyst and columnist for the Chinese website of The New York Times.

He added the company could also face conflicts between its different departments, as it raises the importance of its e-commerce unit.

Suning's sales revenue hit 18 billion yuan ($2.9 billion) last year, up 211 percent year-on-year, while sales of its e-commerce unit reached 1.5 billion yuan.

Its main retail rival, the Hong Kong-traded Gome Electrical Appliances Holding Ltd, China's No 2 home appliance retailer by revenue, issued a profit warning last month forecasting a net loss in 2012.

Gome, backed by Bain Captial, said it planned to pull out of the Hong Kong retail market by closing its six outlets there, in addition to reshuffling personnel at its online business.

Contact the writers at liwoke@chinadaily.com.cn and chenlimin@chinadaily.com.cn

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