A Transition from Channels to Services

As a typical sector of the service industry, securities companies help investors make transactions in the capital market. They provide investors with consultancy and advice and come up with custom-made financial products for them, thereby satisfying the investor's financial demand in various aspects. The current operation models of Chinese securities companies are dominated by the provision of transaction for investors, which gives rise to a typical channel profitability model. With increasingly intense competition, it's an inevitable trend for Chinese securities companies to shift from a channel profitability model to a service profitability model. With a service profitability model, years of business development endows securities companies with acute insight and the ability to discover customer demand. It enables them to accomplish a profitability model transformation through innovative solutions for customer needs, based on persistent pursuit for innovation that is centered on the customer, oriented toward customer needs, and manifested through innovative products. For example, in the brokerage business, the investment consultancy business can be enhanced to meet investor demand for fast and convenient trading of securities, while providing customers with a higher level of services.

Innovation in Traditional Business

Traditional business is the core business of securities companies as capital market intermediaries. The innovation of traditional business is vital to the transformation of securities companies' profitability models. For traditional business, therefore, new profit-making channels should be constantly explored. Efforts should be made to come up with new ways of making profit, and professional and specialized services should be provided.