Li & Fung

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The goal of effective supply chain management is to "gain competitive advantage through optimizing flows within the enterprise". The Hong Kong listed company Li & Fung Ltd represents one of the world 's best examples of achieving this goal. The company financial history clearly tells that story. Just last year, L&F saw profit attributable to shareholder increase by 23%. In fact, over the past 14 years, L&F has seen steady compound annual growth rate of 22%. Not bad performance for a small family company that started in Guangzhou in 1906 trading silk and porcelain. In 1937, L&F moved its headquarters to one of the world 's most efficient seaports, Hong Kong, a move that would have a critical impact on their supply chain management. The L&F…show more content…
As outlined in the principles, a good IT network is central to L&F 's supply chain management success. As early as 1995, the L&F Fung brothers realized the growing importance of the internet in business and established a company-wide intranet linking critical company operations. "A dedicated Extranet links together all the key components of the supply chain to provide tracking capabilities, streamline the flow of business information and provide much more granular control of supply chain activities."
Companies now strive to mimic L&F by following the modern adage "substitute information for inventory". L&F continues to leverage the power of the Internet, as customers demand more customized product choices. According to the business magazine "Asiaweek", "mass customization" is the company 's new strategy, meaning "Li & Fung can offer buyers a wide variety of choices and combinations of color, size, and design for, say, a polo shirt …and still speedily execute large orders." In 2002, L&F started up an entire business division focused on B2B sourcing via an internet e-commerce website called lifung.com linking small- to medium-sized businesses with suppliers similar in concept to alibaba.com. L&F leads the world in supplier sourcing as a true "clicks-and-mortar pioneer".
L&F not only makes full use of technology to expand

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