Just get back from my good friends new apartment at Vanke Holiday. It is another good residential area by Vanke.
Vanke is the No. 1 brand in the real estate industry. It has the largest revenue number, and good at build vast area of residential buildings and turn suburb into new towns.
The Expertise of Doing Business
Sometimes I wondered why companies with huge amount of capital didn’t invest in the booming real estate industry. For example, Microsoft and eBay, and Yahoo! may get better gain in China by investing in real estate if they did it in 2000.
It turned out the idea is naive, since recently, I understand every company has its unique expertise. If you gave 100 million dollars to Vanke and ask Vanke to build a new town, they can spend the money more effective, with lower cost and higher price than other companies can. It is the same to invest 100 million dollars to Microsoft, and they can do better job than Vanke in software industry, and eBay on eCommerce… That is the reason every company focus on their own field, instead of going into too many industry. Many big companies in China entered too much (they call it diversity in business). Some succeeded, but more companies failed to do that. In a more efficient market, the concentration of expertise will be even more clear, so the smart decision is to stick in one industry, and deliver really good result.