Business Intelligence on Retailing, Franchising, and Consumerism in China

Chinese Electronics Retailer Enters New Business Sector

Chinese electronics retailer Gome has announced in Shenzhen the establishment of its communications company through which it wants to seek a stake in the Chinese communications market.

Sun Yiding, vice president of Gome Group, is reportedly the new top executive of the company which has already organized a management team of 1000 people and a sales team of 12000 people. Chinese media reports that Gome Communications Company plans to set up 500 mobile phone outlets in cities across China in the coming year and aims to achieve RMB19.8 billion in mobile phone sales in 2008, and take up more than 10% of the share in China's mobile phone market.

The new company will be responsible for integrating Gome's existing mobile phone channels in addition to managing the mobile phone business in up to 1000 stores of Gome and Yongle, another retailer it recently acquired. In addition, the company will set up independent mobile phone selling sites, TV shopping, online shopping and mobile phone maintenance service.

Gome started mobile phone services in 2001. It has already established long term strategic relations with up to 100 mobile phone manufacturers and developers. Wang Junzhou, vice president of Gome, says that Gome's communications service is currently increasing at a rate of 15% annually and the company will take over 15% of China's mobile phone market in the coming three years.

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