China

Huawei and Suning Team Up on Smart Phone Sales and Additional Businesses

Summary:

  • Chinese cellphone producer Huawei Technologies and Chinese O2O (online to offline) firm Suning Commerce Group (002024.SZ) recently announced that they have reached a strategic partnership agreement, as reported by Tencent Tech.
  • The two firms will coordinate in multiple areas, including product development, distribution channels, and big data.

Why It Matters:

  • According to the strategic partnership agreement, Suning will sell Huawei’s products with a total value of RMB 30 billion on Suning’s e-commerce platforms over the next three years (from 2018 to 2020).
  • Huawei shipped 139.3 million cellphones in 2016 to all over the world and derived a market share of 9.5%, ranking it third after Samsung and Apple.
  • Suning is principally engaged in O2O retailing of household appliances, digital products, and communication products. In 2016, Suning had 4.3% of China’s B2C e-commerce market, ranking it third after Alibaba (BABA.NYSE) and JD.COM (JD.NASDAQ). Moreover, Alibaba is Suning’s second largest shareholder.