Come & Sunning Come Introduction Come, established in January 1, 1987, is the largest retail-based chain seller of home- appliances and electronics products. Background With more than 1,200 direct retail divisions covering most big or medium sized cities in China, Come reached is annual sales of 100 billion Yuan or more. Come opened its first store in Hong Kong in 2003, which marks the first step of internationalization of Chinese home-appliance chain enterprise.
In 2004, Come successfully listed in Hong Kong. Corporate social responsibility and ethics As a social corporate citizen, Come not only pays attention to its own development, but also fulfill their social responsibilities actively. For instance, in 2010, mainland China suffered severe drought and earthquake, Come donated accumulated 8. 1 million Yuan in cash and goods. And in May, 2008, Come donated 64 million Yuan in cash and goods to earthquake-affected areas in Chuan.
Come took an active part in helping to establish medical-aid stations and sports facilities in remote areas after earthquake. In July, 2006, Come donated 5 million Yuan to Chanson Galaxy Prize Foundation (a Student Scholarship Fund) to support those Galaxy Prize winners with high-academic performance to complete their studies. In January, 2005, Come launched the activity Make the world full of love to aid orphans in the Indian Ocean tsunami-affected countries and took the lead in donations with 10 million Yuan.
In this case, Come was the first Chinese companies participating in post-disaster reconstruction of the affected countries. Corporate governance and ownership As a national enterprise with great competence, Come adheres to the business philosophy of Smart Profit but quick turnover, service comes first. Relying on accurate market positioning and innovative business strategies, Come leads the trend of appliances consuming. In addition, Come wins popularity among Chinese consumers of all ages by providing consumers with personalized and diversified services.
Following the concept of enterprise development as business commerce, harmonic mutuality, Come keeps a strategic and cooperative partnership with many well- known manufacturers worldwide and becomes their largest distributor in China. Sunning Sunning Yen Sang, founded in 1990 in Nanjing, China, is the largest commercial retail enterprises in China as well as one of the 15 large commercial enterprise groups cultivated specifically by the Ministry of Commerce of China. Background In July 2004, Sunning Yen Sang (Sunning Appliance (002024)) listed in the Sheehan Stock Exchange, becoming the first domestic PIP household-appliance chain enterprises.
With its chain network covering more than 600 cities at home and abroad, more than 1,600 real stores in China and Japan, a sale of 230 billion Yuan and Come Sunning By Andy_Miami total employees over 18 million people, Sunning has appeared in the “Forbes” top achieving a brand value of 956. 86 billion. Corporate social responsibility and ethics Sunning preserve the idea that Sunning not only belongs to Sunning itself, but also the whole state and society. Sunning Yen Sang always remember the mission of building national commercial brand and make efforts to promote the development of China’s retail industry.
As a responsible corporate citizen, Sunning Yen Sang serves the community by creating Jobs, paying taxes and donating for charity etc. At present, Sunning created Jobs for over 180,000 people, paid a tax with the total of nearly 20 lions Yuan, and donated to various charities for more than 700 million Yuan. Additionally, in 2006, Sunning Yen Sang created 1 +1 Sunshine Tour – Sunning social volunteer action, called on all employees to donate one-day salary per year for charities and to dedicate themselves one day per year to participate in volunteer work.
Since the launch of 1 +1 Sunshine Tour, more than 1,000 volunteer detachments have been set up. And the annual average number of people participating in the Action reached 180,000. Corporate governance and ownership For Sunning, it’s always been the management philosophy that inner system surpasses individual power and colleagues are as important as friends. Besides, there are three behavior rules for senior administrators as follows. Firstly, management means providing service and any behaviors of standard of right is forbidden.
Secondly, systematic rules must be carried out strictly without exceptions. Thirdly, all awards or punishments must depend on facts rather than subjective impression. Time-series and cross-sectional financial ratio analyses 1 . Current ratio is a financial ratio that measures whether or not a firm has enough resources to pay its debts over the next 12 months. If the current ratio is more than 1 which means current assets exceed current liabilities, the company has a good short- term financial position.
As we can see from the charts, the figures of Gomes and Sunning from 2010 to 2012 were both more than 1 which meant they all had good short-term financial positions. Gomes figures of the current ratio were decreasing which indicated Gomes ability to repay debt was getting worse. Gunning’s figures of the current ratio were decreasing first and then increasing which indicated maybe Gunning’s ability to repay debt was relatively stable. According to the current ratio, Sunning figures were larger than Gomes. So, Sunning market liquidity and ability to meet creditor’s demands may be better than Gomes. . Quick ratio is a financial ratio that measures the ability of a company to use its near cash or quick assets to extinguish or retire its current liabilities immediately. If the quick ratio is less than 1, the company cannot currently fully pay back its current liabilities. As we can see from the charts, the figures of Gomes from 2010 to 2012 and the figures of Sunning from 2011 to 2012 were less than 1 which meant hey could not currently fully pay back their current liabilities. But Sunning figure in 2010 was more than 1 which meant it could fully pay back its current liabilities.
Gomes and Gunning’s figures of the quick ratio were both decreasing first and then increasing which indicated Gomes ability to repay current liabilities was better in 2010 and worse in 2011. According to the quick ratio, Sunning figures were larger than Gomes. So, Sunning ability to repay current liabilities was better than Gomes. 3. Debt-to-equity ratio is a financial ratio indicating the relative proportion f shareholders’ equity and debt used to finance a company’s assets. The lower the ratio is, the better the business long-term financial position description and the more secure the interests of creditors will be.
As we can see from the charts, the figures of Gomes were decreasing first and then increasing which indicated Gomes long- term financial position was the best and the interests of creditors were more secure in 2011. The figures of Sunning were increasing which indicated Sunning long-term financial position was worse and worse and the interests of creditors were less and less secure. According to the debt-to-equity ratio, Gomes figure was smaller than Sunning in 2010 but were larger from 2011 to 2012 which indicated Gomes long-term financial position was worse than Sunning in 2010 but were better from 2011 to 2012. . Total assets turnover is a financial ratio that measures the efficiency of a company’s use of its assets in generating sales revenue or sales income to the company. As we can see from the charts, Gomes TAT was increasing first and then decreasing which indicated the asset efficiency of companies was better first and then worse from 2010 to 2012. Gunning’s TAT was decreasing which indicated the asset efficiency of companies was worse from 2010 to 2012. According to the TAT, Sunning figure was larger than Gomes in 2010 which meant it might have a better asset management.
But Gomes figures were larger than Sunning in 2011 and 2012. 5. Operating profit margin is the ratio of operating income divided by net sales. It is a measurement of what proportion off company’s revenue is left over. As we can see from the charts, the figures of Gomes and Gunning’s were decreasing from 2010 to 2012 which indicated the company’s ability to profit was worse and worse. Even Gomes operating profit margin grew negatively in 2012 which indicated Come had poor sales and loss of profits. According to the operating profit margin, Sunning figures certainly were larger than Gomes.
So, Sunning ability to profit was better than Gomes. 6. Return on assets (ROAR) is now used by many firms to evaluate how effectively assets are used. It shows how profitable a company’s assets are in generating revenue. As we can see from the charts, the figures of Gomes and Sunning were decreasing from 2010 to 2012 which indicated the two companies’ ability of profit was lower. Even Gomes ROAR grew negatively in 2012 which indicated Come had loss of profits. The effect of using assets was worse. What’s more, the company’s ability to do with what it had was weaker.
According to the return on assets, the figures of Gunning’s were larger than Gomes. So, Sunning had a better usage of assets and achieved a better result in increasing revenues and savings funds. 7. Return on equity (ROE) is equal to net income divided by total equity. It measures the rate of return on the ownership interest of the common stock owners. As we can see from the charts, the figures of Gomes and Sunning were decreasing from 2010 to 012 which indicated the profitability of the companies owners’ equities were increasingly weaker.
Even Gomes ROE grew negatively in 2012 because the net income was negative. The companies took on too much debt which caused rising cost as creditors demanded a higher risk premium. So BIT was decreasing. The net profit margin was decreasing and every sale brought in less money, resulting in a decreasing ROE. According to the ROE, the figures of Gunning’s were larger than Gomes. So, Sunning had a better usage of equity and had a higher benefit from investment. Its shareholders’ equity had a better ability to achieve profits.