Research Development Vivian Diversification

The diversification strategy is an issue of general concern during the enterprise professional operation into a certain level of development, is to continue to adhere to the professional operation of a single product or business, or chose to diversify into other industries? If the enterprise chooses to diversified development, and then chooses what type of diversification, related diversification or unrelated diversification? If related diversification, then what’s the center of business? What are the key factors for successful diversification? Rational, objective, and comprehensive answers to these questions are placed in front of the enterprise. Solving these questions satisfactorily, will have a profound bearing on the future sustainable development of the enterprises.The paper based on predecessors’diversified research,list the VV Food&Beverage Co., Ltd. of China’s food and beverage manufacturing companies as the research object, attempt to research VV’s diversified development, sum up their experience, analyze the problem and propose corresponding countermeasures and suggestions. In this paper, the research method used mainly qualitative analysis and quantitative analysis, case studies, the combination of research methods, with emphasis on quantitative analysis. The study follows this logic context from discovering problem to analyzing problems,to solving problems.First of all, the information obtained from the VV over the years (2002to2011) Annual Report, more detailed analysis of its diversified business conditions and drivers. Analysis of its operation conditions, mainly through corporate performance to reflect the operation conditions of VV.In this paper, through the integrated use of financial indicators, Tobin’s Q value and EVA analysis of its performance, objectively and comprehensively reflect VV’s the operation conditions. Comprehensively above three analytical method, it can be seen, VV since the2002implementation of the diversification, its profitability began a long period of decline, its market valuation is not high, and continue to decline trend, overall business conditions do not good, and its development may have suffered some kind of bottleneck.Next, the poor operation conditions does not mean that the VV diversification is nothing, long active in the industry must have its successful points. Through the research, we can find, After ten years of diversified development,VV has accumulated some successful experience, including the main three points:First, the concept of food as the center, successful implementation of concentric diversification strategy;Second,According to industry characteristics, focusing on select suitable and diversified way; Third, strengthen the sales network construction,obtain the channel Superiority during the diversified development.VV diversification, however, there are some deep-seated problems, after careful analysis of its2002-2011annual financial data, and found some problems, mainly consists of five aspects:First, ignore the correlation between the industries through blind diversification; Second,no rhythm during the process of diversification, excessive diversification; Third, the profit contribution of the original main business and new business are both weak; Fourth,dispersed enterprise resource and over-diversification; Fifth,neglecting the cultivation of core competencies, strategic planning is too casual.Finally, extract the guiding thinking of the VV future development, and to tease out its future development of business center through the Boston Matrix, on this basis, put forward suggestions to solve the problem of VV diversification. Mainly Including five aspects:one is the correct choice of the timing of diversification, doing all the preparatory work; Second,adhere to related diversification, focus on the synergy effects;Third,learn from outstanding enterprises development experience and grasp the degree and pace of diversified development well; Fourth, strengthen the enforcement of the strategic planning, emphasize more effort on the upgrading of the industry; Fifth, establish and perfect the system mechanisms and focus on cultivating core competence.After the above VV on China’s food industry giants decade diversified development of a comprehensive multi-angle analysis,we can provide some reference for the future development of other same types of enterprises in China’s economic transition period.