Research On Financial Risk Of Suning Under Diversification Strategy

In the new development pattern,China’s economic development speed is gradually slowing down,and the development model has shifted from the extensive scale and speed model to the intensive quality and efficiency model.Faced with this new development model,enterprises must change their business philosophy,carry out structural adjustments,transformation and upgrading.At this point,diversified strategic operations provide more opportunities for the company,but this strategy also brings greater risks to the enterprise.The diversified operations of Haier and Alibaba can be regarded as exemplary examples of Chinese enterprises,but there are also some failed examples of diversified strategic operations,such as Le Eco,Storm Video,and the bankruptcy of Evergrande.Therefore,diversification strategy is not applicable to the future development of every enterprise,especially in the period of strategic transformation facing serious financial risks.Identifying the causes of financial risks under diversification strategy and preventing and controlling them is an effective way to establish and improve a company’s financial risk management system.Therefore,this article selects Suning.com Co.,Ltd.(hereinafter referred to as Suning)as the research object and is divided into six chapters for writing: chapter one introduction,including research background and significance,literature review,research purpose and content,research methods and technical routes,as well as innovation points of this article;chapter two related concepts and theories;chapter three introduction to the financial risks of Suning under the diversification strategy,including the company overview,the development process of diversification,and the current financial risks of the enterprise under the diversification strategy;chapter four analysis of financial risks and causes in Suning under the diversification strategy,from three aspects: fundraising risk,investment risk,and operational risk;chapter five suggestions for financial risk control of Suning under diversification strategy;chapter six is the conclusion and shortcomings.Through a series of analyses,it can be concluded that the problems and causes of financial risks in Suning include a single financing channel,high repayment risk,imbalanced debt structure,and poor debt repayment ability;Lack of scientific overall planning in investment,low utilization of funds,and diversified business models drag down asset returns,resulting in low investment returns;Poor cost control,continuous increase in expense rates,lack of strict customer credit rating mechanisms,slow fund recovery,improper management of marketing processes,and declining profitability.To promote the healthy and stable development of the company,this article proposes the following targeted suggestions based on the causes of financial risks: adopting multi-channel financing methods and optimizing debt structure reasonably;In terms of investment,scientifically coordinate and plan investment funds,manage investment projects,and promptly verify the implementation status;Reasonably control costs and expenses in operation,establish a customer credit rating system,and adopt multi-channel marketing strategies.I hope that this article can provide guidance for other retailers in implementing diversification strategies and serve as a warning for managers of other companies in the study of financial risks in Suning.