Management Innovation and Development of Manufacturer-Retailer Relationships for Large Electric Appliances Chain Stores in China

Abstract

With the rapid pace of IT revolution, companies are getting closely tied and their relationships are gone from competition to cooperation in order to achieve a win-win deal. However, The EACS in China, represented by GOME and SUNING, are performing far from satisfaction. They are still in the stage of depressing manufacturers for lower cost by their channel advantage accumulated over years. Now, management innovation is of great importance for EACS in China to survive, especially in the information age. So, how to make use of the latest IT technology to enhance companypsilas competitive advantage is a key factor for EACS to achieve a sustainable development. The purpose of this paper is to analyze the management innovation and the relationship improvement between manufacturer and electric appliances chain stores (EACS) in China in the information age. The paper first analyzed the dynamic of management innovation for EACS in the information age. Then, it analyzes the business model and development issues of EACS in China. By comparison with the business model of global retailers, the paper suggests EACS in China need to adjust their profit model, to establish strategic partnerships with manufacturers and adapt IT technology into their SCM, focus their efforts on differentiating consumers' needs and product functionality to achieve a win-win situation.