Li & Fung: From an Export Trading Company to Coordinator of Value-Added Services

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Summary Li & Fung, which is a long-standing Hong Kong based company, has evolved from an export trading company to a coordinator of value-added services across the whole supply chain in a global, open manufacturing circumstance. Its corporate culture has enabled it to keep pace with the current trend of global business. The successful acquisitions and the venture capital make the company grows stably and rapidly. However, the company now faces some challenges coming from Asian financial environment and related policies. High sensitive of the change in macro environment is essential for the company to success. At the same time, keeping Asia in an important position could take long time competitive advantages. Finally, the update of information and technology may bring more efficiency and effective within the organization.

Introduction Li & Fung was the first export company that solely funded by Chinese capital in Chinese trade history. Fung Yiu-hing and Li To-ming founded it in 1906 in Guangzhou, China. The firm grew to be a limited company in Hong Kong on December 28, 1937. The company expanded quickly to globalize by the leading of the second generation from the Fung family. The high-speed growth of Li & Fung Limited started when the third generation of Fung’s family took over the organization. The core parts of the company’s business are foreign trade, logistic, distribution and retail. Victor and William tried to restructure the company, use the modem human resource management, and utilized professional management skills to control the company without eliminating the Chinese style management. Li & Fung Limited made use of acquisition to take over the competitors and expanded their suppliers and clients all over the world. The most famous and successful one is the acquisition of Inchcape Buying Services (IBS), which helped Li & Fung Limited to open the European market. At the same time, the brothers establish a venture capital

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