By: Kenneth Connell BUS 550 June 3 rd 2013. The Origins. Founded in 1906 Export Trading Co. to over seas merchants. Warehousing and Manufacturing of Handicrafts Li- Profit Fung- Abundance Relocated to Hong Kong. The Prodigal Sons Return. William Fung MBA (HBS) Managing Director
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June 3rd 2013
William Fung MBA (HBS)
Victor Fung PhD Economics (HBS)
Chairman of the Board
Family Run Business Professionally Managed Firm
The 3 Year Plan
Focused on Filling Gaps in the Network of Offices
Focused on Improving Margins
Doubling Profits every 3 Years.
Achieving $3B in sales
By 2000 They were nearly 5 times the size of closest competitor
“We need to think through e-commerce properly to formulate a proper Response”- Victor Fung
Transformation of the Business?
B2B Relationships were:
Victor had a profound understanding of what the internet meant to their business.
The Castling Group.
Old Economy Vs New Economy
Castling Group + Li & Fung Corporation = LiFung.com
The Three Stages of an Online Venture.
Although the group is developing along the lines of a new economy, we’re still using an old economy mindset.”
“The Key is to have Old Economy know how and yet be open to new economy ideas.”
- William Fung
Target SME’s Retailers with <$100M in Sales
Wholesalers with < $50M in Sales
“The Guys who work with The Gap and The Limited”
B2B Platforms were no threat.
NO VALUE ADDED
“Beta means never having to say that you’re sorry.”
Would Li&Fung’s entire operation migrate online?
What of Channel Conflict?
Would a copy-cat mimic their business model?