Home Business Park No. 5 Review | For the merger of Caesars and Zhongxin,...

Park No. 5 Review | For the merger of Caesars and Zhongxin, we can not only see the game of capital, nor can it be just the game of capital


On the last day of the Dragon Boat Festival, two major A-share listed tourism companies issued an announcement: Caesars Tourism intends to issue A shares to all shareholders of Zhongxin Travel, and merge with Zhongxin Travel through share swaps.

Simply put, it is Caesar and all believers together.

Judging from public reports and comments, it is more of a capital-level combination of words and skills such as the equity structure, the combined market value, and the change of actual controllers. In fact, this is the merger of the two top 20 Chinese tourism groups, which will have a broad and profound impact on the direction of the travel service market and the future of innovation and development of the tourism industry.

In this regard, we can’t just see the game of capital, let alone be a melon-eater, but also think about the impact of this event on the rights and interests of tourists, employee rights and benefits, the outbound market competition, and even the construction of a modern tourism system Deep influence.

The internal mail of the merged party defined the relationship between the two companies before the merger as “competition”, emphasizing that “Alltrust is good at wholesale, and Caesar is good at retail.” Accordingly, the two companies should be located in the wholesale and retail links of the travel service industry chain. In most cases, the relationship between upstream and downstream companies should be cooperation greater than competition.

Major auto sales companies and 4S stores, clothing wholesale markets, and terminal sales points may have inter-industry games in terms of wholesale and sales terminal pricing power, distribution agency power, channel management power, etc., which belong to the influence and discourse under the pattern of interdependence. The struggle for power will not be the same as between wholesalers and retailers.

In fact, the two companies have both wholesale competition and retail competition in the European tourist market for Chinese citizens.In recent years, there has been direct competition between the two parties in terms of resource management and control, product and service innovation in the shopping, small transportation and local life markets. Now that we have merged, I am afraid it will not be as simple as “in the future, we will go together, learn from each other and learn from each other”, but also accept changes in the actual controller and the board of directors, the board of supervisors, the senior management team, as well as professional managers, technical teams and cultural genes. The challenge of restructuring and reengineering must accept the scrutiny of the tourism administration department and the scrutiny of the tourism industry counterparts.

In this sense, whether “A merges with A” or “groups to withdraw money”, they are all just describing the appearance of the capital game in news language, rather than systematically interpreting typical events from the perspective of market rationality and business ecology. We hope to see the merged “Caesars-Zhongxin” system better protect the rights and interests of tourists and bring service quality to a new level.Competition is the norm in the market. The more intense the competition, the greater the pressure on the enterprise. From the perspective of tourists, the fiercer market competition is, the more consumer rights and interests can be protected. This is also the internal reason why every market economy country encourages competition and mobilizes legal, administrative, media and social resources for anti-monopoly. For Chinese citizens traveling to Europe, it may be because the company has turned resources to defend against competition to product development and quality control to enjoy updated products and higher-quality services, or it may be due to the lack of competitors of the same magnitude in the short term. Do not pay a higher price for the same product. We hope to see the former rather than the latter, and we also hope that the merged company will make the company’s strategy more transparent through dialogue and communication at an appropriate time. We hope to see more product development, service upgrades and business model innovations.Travel agencies are a typical form of the tourism industry. They have played a key and active role in the inbound tourism market in the 1980s, the domestic tourism market in the 1990s, and the outbound tourism market in the first two decades of this century. With the maturity of consumption and the advent of the digital age, traditional travel agencies are facing the reality of repositioning. One is to continue to follow the classic business model of “charter flights, charter ships, and hotels, inter-industry wholesale + direct sales, and get the intermediate price difference”. Second, while grasping the source of customers, strengthen cooperation with suppliers of self-financed items such as shopping stores and entertainment performances, and copy the model of “unreasonably low prices, zero negative group fees, rebates, and rebates” in disguise to overseas, and through investment Payment platforms, immigration agencies, and study abroad agencies obtain high non-main business profits. The third is to take the road of “cultural and tourism integration + cross-industry cooperation”, and provide tourists with more quality products and services endorsed by goodwill with an open and transparent business model. In the past few years, Caesars has chosen a third model that is more in line with the development needs of contemporary tourism, and has withstood the test of the new crown pneumonia epidemic, which is what modern enterprises should be.We have reason to believe that the merged “Caesars-Zhongxin” system will inherit Caesar’s business model and carry out business under the sun to the end. The sea is turbulent. For our tourism industry, no matter where the two companies will go in the future after this merger, they will always be the “true heroes” of the year