Analysis of Li & Fung Case
Investigation and Analysis
Li & Fung was founded by Victor Fung’s grandfather in Guangzhou way back in 1906, and became the first export trading firm owned by a Chinese. It its rich history, it has moved from a mere traditional export company to a large and dynamic multinational corporation with expertise in supply chain management (Qi, Kenneth, & Xiande p. 667-695). It three core businesses include export trading, distribution and retailing. The company’s main focus is on customer needs and offers effective supply of products so that it can supply an appropriate number of consumer products within the specified time and at the right price for all its customers. However, throughout its long-standing history, the company has undergone four stages: being a purchasing agency, doing borderless manufacturing, doing virtual manufacturing and finally offering supply chain management (Qi, Kenneth, & Xiande p. 667-695). The cultural norms of both Li & Fung Company and China as a nation embrace and respect cultural differences in various localities and market orientations.
In addition to diversifying its export market, Li & Fung is also eyeing the ever-expanding Chinese market. With a population of nearly more than 1.3 billion people, China presents, in itself, a massive purchasing power. The country has realized tremendous success in the economic reforms as average income levels have been on a continual rise with living standards seeing equal corresponding improvements. This local economic situation implies that local Chinese enterprises such as Li & Fung may not be heavily affected by emerging global financial turmoil as they can still explore the local market to remain competitive.
Work Cited
Qi, Yinan, Kenneth K. Boyer, and Xiande Zhao. "Supply chain strategy, product characteristics, and performance impact: Evidence from chinese manufacturers*." Decision Sciences 40.4 (2009): 667-695.
