Specialization key to success

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By Han Tianyang (China Daily)
Updated: 2009-09-29 13:44

Now, with its twin goals of expansion and its establishment as a niche player, BTG has emerged as one of China's leading tourism companies. It is now a mature business, well capable of withstanding short-term difficulties in any of its key sectors.

Duan said: "It is not only among our six target sectors that we have sought to capitalize on the benefits of running complementary businesses. We have also looked within those sectors to see how we can better exploit our group resources.

"The New Yansha Group is a prime example. Following our restructuring initiative, it now consists of eight subsidiaries, covering four commercial formats - high-end department stores, fashion department stores, outlets and shopping malls."

Duan's enthusiasm is echoed by Zu Guodan, general manager of the New Yansha Group: "It is often said that when one door shuts, another one opens. This has certainly proved true for us. Although our department stores have been adversely affected by the economic crisis, our outlets and shopping malls have continued to perform well this year. This has provided a considerable boost for Yansha's overall turnover.

"Our growth in first half of 2009 was well above average in comparison to other companies in the same sector. This has played a major role in compensating for the under-performance in other areas of BTG's business."

Despite its huge progress in recent years, BTG's management remains realistic about its global status. Liu said: "In terms of where we started, BTG has grown enormously, but it still has a long way to go before it truly becomes an international tourism giant."

The group has always aimed to compete with its international counterparts. Duan said: "Overseas hotel and shopping brands have already entered the Chinese market. So, even in the domestic tourism market, we have to face global competition. Our goal now is to create a world-class Chinese brand, capable of succeeding in the international market."

Although BTG actively competes with foreign brands, its management team is still cautious about extending its business interests into overseas markets. Duan said: "We do currently have some overseas investment, but it is at a very low level. We only have $100 million worth of foreign assets at present.

"Most of the SOEs investing abroad are resource-based. As a tourism business, BTG doesn't yet have enough experience in the overseas acquisition market. It requires considerably more research and investigation than we have yet undertaken."

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