Download The SWOT analysis of Wanda Commercial properties

Dalian Wanda Commercial Properties of Wanda Group
11602 戴璐 李雪
 Background
 Dalian Wanda Group was founded in 1988 and operates in four major segments:
commercial property, luxury hotels, culture & tourism, and department stores.
 The company has 300 billion RMB ($48 billion) in total assets, and 141.7 billion
RMB ($22.7 billion) in annual revenue, 20.2 billion RMB in annual taxes, and net
profit of more than 10 billion RMB.
 By November 1, 2013, Wanda Group increased its portfolio to 81 Wanda Plazas,
46 five-star hotels, 6,000 movie screens, 70 department stores and 76 karaoke
centers.
 Slogan: International Wanda Centennial Business
 Wanda Commercial Properties
Wanda is a global leader in the field of commercial real estate with a portfolio of 81
Wanda Plazas across China, ranking second in the world. Wanda Commercial
Properties consists of a business planning and research institute, national
commercial property construction team, a national business management company,
all of which form a full industry chain giving it a competitive advantage in its industry.
The SWOT analysis of Wanda Commercial properties
 Strength
a) The largest property operators around the nation, it has formed the scale effect.
b) The projects are in the traditional commercial gold position of first-tier and
second-tier cities or in the core position of some boom towns. The surrounding
traffic is very convenient and they promote the development of the shops around
them.
c) "Order for estates" mode, business resource platform is very well.
(*Order for estates means that the developer will contact the corresponding brand’s
merchants to inspect a land together, when the merchants are to a certain degree of
satisfaction with the land, the developer will bid for it.)
1. Joint development —— Enhance the commercial rallying point.
2. Average rent —— Save the negotiation time, improve efficiency and ensure
the stable return
3. Build before leasing —— Reduce the investment risk
4. Technique transfer —— To avoid blind waste
d) The independent investment industries: Wanda cinema and Da gexing KTV with
a good momentum of development and possess the core competitiveness.
e) Have a sagacious governor, an efficient implement team and sense of social
responsibility.
 Wang jianlin
According to an interview of the American magazine ------“Fortune”, it said
Wang uses the rigorous and strict management like army to supervise Wanda.
He is a hands-on leader, every Saturday morning he held a meeting for
examining blueprints and he will contrast the map to revise the drawings until he
is satisfied with it. He has not been involved in any scandals.
 Team
From planning to buy land for construction, Wanda’s project cycle is in 18 to
24 months. Wanda had never been postponed the project or exceed the budget.
 Social responsibility
Wanda will publish two books this year “Commercial properties investment
construction” and “Commercial properties operation management”, Wanda as the
leading enterprise in this industry, it want to help peers to avoid detours by these
books.
Wanda is also keen on the charities. When some area was in trouble or was hit
by a disaster, Wanda will donate money to help them.
 Weakness
a) The main shops’ rents are very low.
(*The main shops including: WAL-MART, Gome, Sport 100, ZARA, NIKE, Adidas, L
‘Oreal, etc.)
1. The main shops occupied more than 70% of the whole Plaza and the rent is
too low to effect of benefits.
2. Pulling the effect of excessive dependence on the main shops and rely on
renting small shops to recoup the investment.
b) The situation of graft and corruption is difficult to prohibit in the company.
The group work report pointed out: in the first half of 2013, audited 94 times, found
out problem 193, punished employees 173, 3 of them were transferred to judicial, 13
people were dismissed, 1 people were downgraded, 156 people of other punishment
and found 2 grave corruptions.
 Opportunity
a) Preparations for the inland IPO, most of the securities institutions agree that the
prospects.
b) Keep a high speed development situation on land acquisition, Wanda Commerce
has more reserve and potential projects.
c) Wanda Commerce has packages with offshore assets & potential financing
capabilities.
d) The fourth generation products consider joining fitness class of buildings,
increased leisure entertainment experience forms to extend the time of consumption,
hoping to improve the main store rent low state.
e) The domestic market, there is no strong competitors compete with them.
f) The residents' consumption ability and consumption grade have changed. People
pay attention to the experiential consumption.
 Threat
a) The shortage of professional talents and the shortage of high professional
management talent is the core factor that restricting the development of its
subsequent.
b) With the rapid expansion of the land, the enterprise fund chain is tight.
c) Rely on the flow of sales cash, the market volatility cause the potential influence.
d) Rely on bank credit, special treatment of long-term sustainability.
e) Transparent is the challenges for the corporate governance.
Strategic analysis
 Strength & Opportunities (SO)
a) Take advantage of the brand superiority assets to expand. Rapidly occupation of
the first-tier cities, and gradually developed to second-tier cities.
b) Learning foreign commercial real estate development model, exploration and
application of the fourth generation mode.
c) Actively develop the own brands and promote the core competitive ability.
 Strength & Threats (ST)
a) Take advantage of the Wanda now, active financing, solving the bottleneck of
funding shortages encountered in the process of extension.
b) Cultivating high-quality management personnel.
 Weakness & Opportunities (WO)
a) Take advantage of Wanda, choose better tenants in the process of investment
and appropriate raise the rent.
b) Cultivate excellent team management, actively explore science of business
management mode.
 Weakness & Threats (WT)
a) Continuous innovation and responsibility in the process of market advance and
development.
More information:
http://www.wanda-group.com/
http://www.wandaplazas.com/en/