logistics and scm of li and fung
DESCRIPTION
Presentation of Logistics and supply chain management of Li and Fung Ltd. (Hong Kong).It tells how the company developed and why it is still at top in management and customization of supply chains.TRANSCRIPT
FAST, GLOBAL & ENTREPRENEURIAL:SUPPLY CHAIN, HONG KONG STYLE
An Interview with Victor Fung By Joan Magretta
PRESENTED BY-> GAURAV KHARA(B04)SHIPRA GUPTA(B05)MOHIT CHAWLA(B06)
• 1906-1949Founded by Mr Fung Pak-Liu and Mr Li To-Ming.
Traded products like silk, bamboo, handicrafts and fire works.• 1949-1979
Starting exporting Labour Intensive Consumer Products.• 1979-1985
Opening up in China and industrialization in less developed Asian countries
Heavy investments made during this time.• Since 1995
Evolution of Multinational Group.
Li & Fung’s developmentAssortment packing e.g.: Toolkit assembled from :Spanners from country AScrewdrivers from country B
Dispersed ManufacturingE.g. Transistor Radios
Source components from Korea/ TaiwanSend kits to China for AssemblyTest & Inspect in Hong KongShip out to the World
Dispersed mfg
Assortment
Trading
Seven Pillars
•Customer Centric and Market Demand driven•Focus on one’s core competency and outsource non-core activities•Close risk and profit sharing relationship with business partners•Design, implement, evaluate and improve the several flows•IT to improve efficiency of the SC’s operation•Shorten Production lead time and delivery cycles•Lower costs in sourcing warehousing and transportation
How Li adds value Li Fung does the high value added Front
and Back end Tasks in Hong Kong
Front End-Design-- Engg
- Prodn Plng
Back End-QC-Test
- Logistics
Raw Matl+ Component
Sourcing
ManagingProduction
Li organizes lower value added middle stages thru’ its Network of 7500 suppliers. 2500 of which active at any given time.
Alignment between Business and IT
Three main BusinessIntranet and Extranet linksTracking systemsCentralised IT systemE-commerceClicks and Mortar pioneer
Overview of two marketLi Fung: Supplying Li Fung: Supplying Baby DollsLi Fung: Supplying Baby Dolls
Li supplies 10,000 Garments to European Retailer in 5 weeks!
Hong Kong-Design- Make molds
China-Mold- Assemble- Paint- Doll clothing
Hong Kong-Inspection-Packing
Distribute
ToThe
World
Back
KoreaYarn
TaiwanWeave
&Dye
ThailandGarment
Japan/ ChinaZippersButtons
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Li Fung: Supplying Baby Dolls