Li&Fung Case Study Analysis

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Strategy Management (Case study 1: Li& Fung)  SWOT Analysis Strength Opportunity  Extensive network of suppliers (global reach supplier with SCM)  Provision of value added service (customer centric structure)  Entrepreneur corporate culture Low –end with hard goods Emerging Market Weakness Threaten  Over dependence on US Market  Vast supplier network makes it tough to maintain  Increasing expense from acquisiton  Continuing global economy downturn - Collapse of the American housing - Credit market yield Increasing cost  Question 1) In light of the American recession, what can Li & Fung do to continue expanding its business and reach its target of US$20 billion for the period 2008-2010? In light of the American…show more content…
At present, GDP growth in China is above 10%, with India and Russian markets growing at 8-10% and Brazil up 5%. Also, there are many populations total 300billion. Especially, China is 140billion, India is about 120billion, Brazil is about 20billion, and Russia is 15billion. Through the above figures are closely BRIC market has determined that potential and growth. Also, the concept of China as the world’s factory is well established. We are now going into the next wave though, which is China as potentially the world’s largest consumer market. Also, the urban population of China expected to increase from 40% to 50% by 2011, organized retail outlets and brands from overseas can prosper. Meanwhile, Li & Fung in the European and U.S. markets high and mid market has maintained a policy. However, compared to Europe and the U.S. due to low levels of GDP should expand into low-cost market. Also, we should consider value added services. For example, Li & Fung has the ability to provide designs to its customers and support them in marketing, on top of its traditional trading role. We also should reflect their own culture in BRIC when we provide products to consumers. In summary, like China, in BRIC market demands of consumers change radically and would become important consumers themselves forcing supply chain masters like Li & Fung to source as well supply to these places. The company that
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