Business layout is the overall business deployment and planning centering on competitiveness made by enterprises after they identify markets. Against the backdrop of globalization, being based on the domestic railway transport market and proactively expanding diversified business and international business can help enterprises make full use of their own advantages and resources on hand to better meet domestic and foreign market consumer demands, and economically control operating costs, so as to obtain more operating benefits whenever possible. German DB AG, French SNCF, Japanese JR-East, and Russian RZD all focus on the core business of railway transport, railway network construction and maintenance, and meanwhile proactively expand their diversified business and international business. 

There is a difference between railway transport enterprises of various countries in arranging the strategic importance of transport business and non-transport business. The major railway transport enterprises of some countries regard the implementation of a diversified development strategy and the promotion of non-transport business as their major development strategy. After many years of development, non-transport business has developed into an income pillar and an important profit growth point for enterprises, such as the German DB AG, French SNCF and Japanese JR-East. Some countries have not put forward a clear strategy of diversified development, only consider non-transport business as the cooperation and complement to the main transport business. As shown in the table below, railway transport enterprises of various countries have different key development orientations for the main transport business and the non-transport business. 

Table 1 Business Layout of Railway Transport Enterprises of Various Countries 

Strategic orientation

Enterprise

Transport business

Diversified business

Performance of diversified business

Strategy of diversified development

German DB AG

Railway passenger and freight transport, railway network construction and maintenance

Non-railway passenger and freight transport, logistics services and railway consulting and services, WiFi, insurance, real estate development, property management, parking services, and commercial operation of stations

Contributing 50.9% of the income and about 40% of the profit

French SNCF

Railway passenger and freight transport, railway network construction and maintenance

Logistics, urban transport, commercial operation of stations, engineering construction, finance, information services, passenger extension services, and engineering design

Building a lot of well-known enterprises

Japanese JR-East

Railway passenger transport, operating the largest Shinkansen network in Japan

Station space utilization, shopping malls and office buildings, Suica card, real estate development, WiFi and other information services, as well as hotels, advertisement, logistics, sports and health, childcare, insurance agency and other business

Contributing 32% of the income and 35% of the profit

Non-transport business is considered as cooperation and complement

Russian RZD

Railway passenger and freight transport, operating the world's third largest railway network

In addition to logistics, tourism, highway connection, advertisement, catering, hotel business, it also operates in railway real estate, rolling stock and other equipment leasing, rolling stock maintenance, power transmission, communication

Contributing 12% of the income

The scope of diversified business is directly related to the benefits of enterprises. According to relevant research, the profitability of enterprises of related diversified operation is generally higher than that of enterprises of non-related diversified operation. For railway enterprises, developing non-transport business related to the main transport business can help them share tangible resources (land, technology, labor, etc.) and intangible resources (corporate reputation, brand, popularity, etc.), realizing business complementarity and achieving synergy effect and scope economy effect, so as to effectively improve resources utilization and reduce the operating costs and risks of the entire railway company. In fact, major railway enterprises of developed countries show this pattern in the non-transport business scope. Namely, most of them extend their industrial chain focusing on the railway transport, and the non-transport business scope is highly correlated with the transport business. The main business scope is as follows: 
 
(1) Complementing with railway transport, and further improving other transport services in the transport service chain, such as logistics service and logistics center operation, highway passenger transport; 

(2) Derivative services of various transport businesses, including WiFi, electronic ticketing and other information services, insurance, tourism, advertisement, property management, parking service and other domestic services; 

(3) Derivative business of railway technology, such as engineering technology consulting and transport infrastructure construction, equipment maintenance and repair;

(4) Derivative business of railway assets, including real estate leasing, commercial real estate development, station commercial operation, hotel operation, rolling stock leasing, and power transmission.