Cost Management Under Suning’s Value Chain Model

Under the influence of economic globalization and the rapid development of information technology,the cost management model has also undergone great changes.Enterprises should not only pay attention to the reduction of costs,but also pay attention to the increase of the value of each link in the whole operation.The cost management in the value chain mode meets the requirements of the advanced enterprise cost management mode,and is the optimal cost management mode for modern enterprises in the globalization and information environment.In recent years,Suning has gained certain advantages in the operation of cost management based on the value chain model,which is worthy of reference for e-commerce enterprises.This paper reviews the research on value chain cost management at home and abroad.On the basis of defining the concept of value chain and cost management,it deeply analyzes the outstanding characteristics of Suning’s value chain cost management mode in operation by means of management coordination theory and modern organization theory.Article first in electricity industry as the background,narrates the electricity industry enterprise cost management present situation,found that the current electricity industry enterprises there is a lack of transaction cost control,logistics cost control is weak and inventory cost control level is relatively low,exposed the internal link lack of cohesion,in the same industry,the insufficient coordination of upstream and downstream.Secondly,it compares the cost management differences between traditional manufacturing enterprises and e-commerce enterprises due to the differences in design,research and development,sales and logistics.Finally Suning purchase value chain cost management can be divided into internal and external two parts,the internal value chain cost management mainly from the four stages warehousing,logistics,sales and after-sales were analyzed,and the analysis conclusion: Suning in advertising and product sales and after-sale link closely,improve a value and competitive advantage is obvious.The cost management of the external value chain is mainly analyzed from two dimensions: vertical(upstream and downstream)and horizontal(horizontal enterprises in the same industry).Comparing with Gome retail in horizontal dimension,it is found that Suning’s advantage in cost management lies in the combination of online operation and offline stores,and the omni-channel mode dominates.To sum up,Suning adopts the value chain cost management mode to achieve overall consideration of internal links and coordinated development of external dimensions,thus optimizing cost management.Therefore,the value chain cost management model can be used as the preferred cost management model for e-commerce enterprises.The main contribution of this paper is that on the basis of previous studies on Suning’s internal value chain,it also carries out an analysis on the external value chain,and comprehensively and systematically studies the internal and external value chain of Suning.Hope to enrich the relevant research cases of value chain cost management.