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Lung Cheong International: How to Survive in a Changing Business Landscape                                                                                                                                                                                                                
Product Ref: 03/165C Company: Lung Cheong International Holding Limited

Product Type: Case Industry: Consumer Goods

Related Product(s): Teaching Note
Authors: Bennett Yim   Vincent Mak
Lung Cheong International Holding Limited was founded in 1979 as an original equipment manufacturer (OEM) of toys in Hong Kong. As the Mainland Chinese economy took off in the 1980s and 1990s, China became a great hinterland of cheap land and labour for low-tech manufacturing and also a huge and growing consumer market. Lung Cheong continuously felt the challenges of the changing business landscape. Should it move its production lines to the Mainland or somewhere at similarly low cost-levels? How should it deal with its major Western and Japanese customers in order to maintain good relationships? Should it enter the huge Mainland Chinese sales market? If so, how could it compete with Mainland-based manufacturers that enjoyed lower production costs and could sell products very cheaply? How could it deal with rampant copyright piracy problems in the Mainland market? Or should it focus instead on the West, in particular the US market?
Functional Area : Economics & Business Policy
Strategy & General Management

Issues: Strategic Shift, SME, Toys Manufacturing, Competition in China, Brand Building, Original Equipment Manufacturer (OEM)
Length: 7 pages Country: Hong Kong SAR

Pub. Year: 2003 Level of Difficulty: 1
This product type is available in the following language(s):      English   Simplified Chinese
Related Information: N/A
This is a part of The Trade & Industry Department SME Case Series
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