Gate China 2014 - Amazon Simple Storage Service (S3)
Gate China 2014 Chongqing New Oriental School David Feng, Enoch Han Business Overview New Oriental Education & Technology Group Inc. (NOETG), founded in 1993, is the largest provider of private educational services in China based on the number of program offerings, total student enrollments and geographic presence. In 2006, NOETG successfully listed on the New York Stock Exchange (NYSE:EDU), becoming China's first educational institution listed in the U.S. NOETG offers a wide range of educational services consisting primarily of English and other foreign language training, test preparation for major admissions and assessment tests in the United States, Commonwealth countries and the PRC, primary and secondary school education, development and distribution of educational content, software and other technology, and online education. Founded in 2003, the 10th branch school established by NOETG, Chongqing New Oriental School (CQNOS) has developed into the No. 1 training school in Chongqing. Today, CQNOS has multiple locations blanketing the Chongqing market with training centers throughout the metropolitan area. In fiscal year 2013, CQNOS has ranked 7th among NOETG’s 57 schools nationwide in annual revenue.
Operations in China NOETG’s mission is to inspire Chinese students of all ages to improve their lives and expand their horizons through a lifelong commitment to learning. By empowering students to achieve their potential, build self-confidence, and develop a global vision, NOETG is committed to training a new generation of business and community leaders. NOETG expects the market for language and test prep instruction in China to grow dramatically in the coming years and is preparing itself to take advantage of this opportunity. Specifically, NOETG is working to increase both the number of New Oriental schools in China and, at the same time, increase enrollments per location. It is also strengthening its existing strategic relationships with education content providers (i.e. Pearson, McGraw-Hill, GMAC, etc.) while continuing to pursue new opportunities. From a strategic perspective, CQNOS implements the strategies developed by NOETG headquarters.
Financial & Operating Statistics * In millions USD for fiscal year 2013 (ends 5/31) unless otherwise noted Revenue Estimated Revenue (Fiscal 2014) Net Income Estimated Net Income (Fiscal 2014) Market Capitalization Price Per Share
NOETG 959 1,121.7 136.3 163.5 4,174 $26.36
CQNOS 23 30 5.8 9.5 / /
Stock Exchange Ticker Symbol (NYSE) Student Enrollments Number of Employees # Of locations in China/Chongqing
EDU 2,500,000 17,600 726
/ 62,000 1,000 10
SWOT Analysis Strengths 1. 2. 3. 4.
Brand recognition Good teachers & teaching qualities Positive training outcome Matrix organization structure; on site management 5. Comprehensive product offerings
Weaknesses 1. Lack of focus on certain product lines 2. Inadequate standardization of curricula 3. Inadequate compensation for part of faculty and staff
Opportunities
Threats
1. Growth & increasing prosperity of Chongqing 2. Increased interest in overseas education; increased learning motives of Chongqing people 3. Leveraging technology for online education
1. The market is becoming saturated with competitors 2. Rise of online education 3. Limited talent pool
Company Visit Questions 1. As an education provider that focuses on traditional offline approach, how will NOETG deal with the challenge posed by emerging online education companies? 2. How does NOETG’s headquarters in Beijing interact with its branches nationwide? How does CQNOS’s headquarters interact with its locations in Chongqing? 3. How does New Oriental acquire new customers and retain old customers? 4. How does the regulatory and political environment in China affect NOETG/CQNOS operations? 5. How has the increasing privatization of education affected CGNOS operations? 6. As the market becomes saturated, what is the differentiation strategy or competitive advantage that NOETG/CQNOS will employ to keep ahead of its competition?
Operations in China NOETG’s mission is to inspire Chinese students of all ages to improve their lives and expand their horizons through a lifelong commitment to learning. By empowering students to achieve their potential, build self-confidence, and develop a global vision, NOETG is committed to training a new generation of business and community leaders. NOETG expects the market for language and test prep instruction in China to grow dramatically in the coming years and is preparing itself to take advantage of this opportunity. Specifically, NOETG is working to increase both the number of New Oriental schools in China and, at the same time, increase enrollments per location. It is also strengthening its existing strategic relationships with education content providers (i.e. Pearson, McGraw-Hill, GMAC, etc.) while continuing to pursue new opportunities. From a strategic perspective, CQNOS implements the strategies developed by NOETG headquarters.
Financial & Operating Statistics * In millions USD for fiscal year 2013 (ends 5/31) unless otherwise noted Revenue Estimated Revenue (Fiscal 2014) Net Income Estimated Net Income (Fiscal 2014) Market Capitalization Price Per Share
NOETG 959 1,121.7 136.3 163.5 4,174 $26.36
CQNOS 23 30 5.8 9.5 / /
Stock Exchange Ticker Symbol (NYSE) Student Enrollments Number of Employees # Of locations in China/Chongqing
EDU 2,500,000 17,600 726
/ 62,000 1,000 10
SWOT Analysis Strengths 1. 2. 3. 4.
Brand recognition Good teachers & teaching qualities Positive training outcome Matrix organization structure; on site management 5. Comprehensive product offerings
Weaknesses 1. Lack of focus on certain product lines 2. Inadequate standardization of curricula 3. Inadequate compensation for part of faculty and staff
Opportunities
Threats
1. Growth & increasing prosperity of Chongqing 2. Increased interest in overseas education; increased learning motives of Chongqing people 3. Leveraging technology for online education
1. The market is becoming saturated with competitors 2. Rise of online education 3. Limited talent pool
Company Visit Questions 1. As an education provider that focuses on traditional offline approach, how will NOETG deal with the challenge posed by emerging online education companies? 2. How does NOETG’s headquarters in Beijing interact with its branches nationwide? How does CQNOS’s headquarters interact with its locations in Chongqing? 3. How does New Oriental acquire new customers and retain old customers? 4. How does the regulatory and political environment in China affect NOETG/CQNOS operations? 5. How has the increasing privatization of education affected CGNOS operations? 6. As the market becomes saturated, what is the differentiation strategy or competitive advantage that NOETG/CQNOS will employ to keep ahead of its competition?
