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Forbes Top 500 Advances Newsletter, May, 2015 Vol. 5, #4, May 2015, No. 48 Forbes Top 500 The group has entered Forbes’ list of the world’s top 500 public companies 1 Advanceswww.midea.com Newsletter, May, 2015 ADVANCES Newsletter Contents NEWSLINE US$800 million to Be Spent on Language Group Enters the Forbes 500 Automation in 5 Years PAGE 8 PAGE 3 To Use or Not to Use a Dic- Magazine Publishes in-Depth tionary? PAGE 13-14 Report about Xiaomi Deal Midea App Available on PAGE 9 Big Picture Apple Watch PAGE 4 CAC Global Technical Concepcion Midea to Training Held in Shunde PAGE The Fast Food Wars PAGE 15 Double Sales Year-On-Year 10 PAGE 4 Innovative Cooking Solutions Idea Tasting the Home of the Fu- for Homes and Businesses Idea of the Month: Social ture PAGE 5 PAGE 11-12 Skills PAGE 16 Belarus JV to Diversify Prod- uct Range PAGE 6 People DDB Shanghai Wins RAC The Brains Behind the Brazil Contract PAGE 6 Brand PAGE 17-19 Official Sponsor of Indian Premier League Cricket Team PAGE 7 RAC Dominates Central Chinese City PAGE 7 Midea Advances Newsletter is published monthly Managing Editor: by the International Strategy Department of Midea Group. We welcome all comments, Kevin McGeary suggestions and contribution of articles, as well as Regular Correspondents: requests for subscription to our newsletter. You can reach us by email at: [email protected] Javier Romano John Baker Kelvin Wu Address: Lemon Lin ADVANCES, International Strategy Department Shirley Liu Midea HQ No. 6 Midea Road Beijiao, Shunde, Foshan, Guangdong P.R.C. 528311 Tel: +86-757-23270461 Web: www.midea.com/global 2 Advances Newsletter, May, 2015 NEWSLINE Group Enters the Forbes 500 By Advances M idea Group has en- tered the top 500 public companies in the world, according to The Forbes Global 2000. Sales, profit, assets and market value were taken into account to help Midea to 436th place on the magazine‘s an- nual list, higher than appliances giants Whirlpool, LG and Electro- lux. Impressively, the company also ranked 24 places higher than Star- buck‘s. Midea ranked 408th in sales, 418th in profit, 1117th in assets and 534th in market value, help- profits. They also boast US$25 trillion in assets and combined ing it on to the world‘s most respected list of its kind. Though market value of US$6 trillion. the United States still leads the way, China overtook Japan for ―Midea appears to be reaping seeds that were sewn a long the first time with 232 companies in the top 2,000. Industrial time ago,‖ said Liu Buchen, one of China‘s leading experts on and Commercial Bank of China (ICBC), China Construction the appliances industry. Bank, Agricultural Bank of China and Bank of China were the Since growth slowed down in 2011 due to corporate con- solidation costs and changes in domestic government policy, Midea has prioritized products, efficiency and global expansion. Changes within the company include an emphasis on online sales rather than traditional channels and manufacturing of in- teroperable ―smart‖ technology. These policies have so far paid dividends. In 2014, global revenue was at an all-time high of US$23 billion, a year-on-year growth of 17 percent. Net profit was also at a company record- breaking US$1.69 billion. This growth looks set to continue. Midea achieved reve- nue of US$6.87 billion in the first quarter of 2015, a year-on- year increase of 10.5 percent. The holding company saw net profit of US$538 million, a year-on-year increase of 32 percent. Earnings per share were at US$0.13, a year-on-year in- crease of 32 percent. The gross margin was at 26.8 percent, a year-on-year increase of 1.5 percentage points. top 4. Group President Paul Fang recently told Caixin finance The world has not yet fully recovered from the Global magazine that he wants Midea to operate more like an energetic Financial Crisis of 2008. China‘s domestic economy is experi- start-up than an old-fashioned appliance maker. This news is a encing a slowdown. However, the Chinese companies on the list vindication of his approach. together made US$4.6 trillion in revenue and US$473 billion in 3 Advances Newsletter, May, 2015 NEWSLINE Midea App Available on Apple Watch By Kelvin Wu vide the M idea‘s M-Smart app is now available on Apple highest quali- watch and through other iOS8.2 or higher platforms, it was re- ty service. It ported on May 11. The app, titled Meiju, can be downloaded knows when from the App it is raining store and can and it knows control M-Smart the tempera- appliances. The- ture, humidi- se already in- ty and level clude over 30 of PM2.5. It categories. is also highly According to an attuned to a engineer behind user‘s habits. the project, the Meiju App can store is also availa- user data and ble on respond to both iPhones and indoor and out- iPads. door environ- ments to pro- Concepcion-Midea to Double Sales Year- on-Year Via Manila Standard the new variable refrigerant flow air conditioners, as well as C oncepcion-Midea Inc., Midea‘s Philippines joint ven- large and small kitchen appliances line-up. ture, expects to double sales in 2015 to US$15.63 million amid The sales target in 2015 is just under 1 percent of the the increasing purchasing power of the southeast Asian nation‘s country‘s US$1.7 billion cooling and kitchen appliances market. middle class. The company plans to become one of the nation‘s top Concepcion Midea general manager Phillip Trapaga said three providers of consumer products in the next five years. the company posted impressive sales in 2014 even though oper- ―We know that it will not happen overnight, but we are ations only began in May. one of the most affordable brands with high regard for quality ―We‘re shy of one year selling our products but we did and durability,‖ Trapaga said. well last year. We‘re expecting better sales this year, at most dou- The company has introduced cooling systems from win- bling our performance from 2014,‖ he said in a press briefing in dow-type to split-type air conditioners. It plans to introduce Makati City. floor-standing, under-ceiling and cassette-types this year. The company will be completing its line of white products, including the cost-effective inverter technology refrigerator and 4 Advances Newsletter, May, 2015 NEWSLINE Tasting the Home of the Future By Lemon Lin T he Internet has revolutionized the way people live. It has also revolutionized the way businesses approach the market, through big data, consumer analysis and changes in sales channels. However, it has only just started to affect con- sumers‘ relationships with their household appliances. At an event held at The Shunde Sheraton on April 22, Midea set up a stand which gave spectators a taste of the home of the future, with intelligent products that are likely to become commonly owned within the next decade. Visitors could even taste dishes cooked in front of them using the The Experience Centre has a highlights area, star products area, experience area, tasting area, and photo display area. There are also cooking classes where visitors can taste, smell and touch the home of the future. The products can be controlled by online devices such as mobile phones and, in some cases, Xiao- mi bracelets. The first thing visitors see upon entering the kitchen is a ―rice map,‖ which shows how Midea has sourced the best prod- ucts to provide its kitchen experience. As well as rice cookers, demonstrated in the kitchen are soymilk makers, juicers, toasters and noodle makers. There is also a children‘s play area, which means visitors can focus the whole of their attention on the experience. The Experience Centre has been receiving good reviews. A representative of the Small Appliances Division told an inter- company‘s futuristic appliances. nal publication that he couldn‘t wait to take the show on the In the age of e-commerce, consumers like to experience road. The brand of Midea‘s smart home experience will be pro- what they are buying. Traditional sales techniques and prod- moted through word of mouth. ucts no longer cut it. The Experience Centre offered a demonstration of smart, localized and interoperable technolo- gy which will form the future of the industry. To stay ahead of the competition, an appliances brand must be aware of consumers‘ concerns related to travel, enter- tainment, exercise, health, environment, home, and family. An effective way of building brand loyalty is allowing members of the public to experience products first-hand. By July the show will have been taken on the road to Beijing, Shanghai, Chengdu and over 50 other major cities in China. The L-shaped stand is designed like a trendy modern home. The design mostly consists of black and white, evoca- tive but unthreatening colours. 5 Advances Newsletter, May, 2015 NEWSLINE Belarus JV to Diversify Product Range Via Belarusian News steady development and job creation. ―We have been moderniz- T he joint Belarusian-Chinese company Midea Hori- ing and will continue modernizing our equipment in order to zont plans to release new products improve economic conditions, in 2015, Midea Horizont Director reduce energy consumption and General You Baofen told Belarus- adverse environmental effects,‖ he sian News. explained. ―Midea Horizont is working The joint Belarusian-Chinese com- on a new project to produce heat- pany Midea Horizont was set up ing boilers, dispensers, and cook- in 2007.
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