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    Lyfen: Group No: 5

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    saurabhgupta5798
    LYFEN is the largest snack food retailer in China, with annual revenue of 3.9 billion yuan. The case examines LYFEN's growth strategies in the highly competitive environment and the role of its supply chain in leveraging revenues. Following an IPO incident, LYFEN implemented strict quality control measures and increased supplier certification standards. This led to a decline in its stock price due to higher operating expenses. LYFEN plans to expand its distribution network to 10,000 retail locations in the next 5 years, which will put pressure on suppliers to increase capacity while maintaining quality.

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    Lyfen: Group No: 5

    Uploaded by

    saurabhgupta5798
    246 views15 pages
    LYFEN is the largest snack food retailer in China, with annual revenue of 3.9 billion yuan. The case examines LYFEN's growth strategies in the highly competitive environment and the role of its supply chain in leveraging revenues. Following an IPO incident, LYFEN implemented strict quality control measures and increased supplier certification standards. This led to a decline in its stock price due to higher operating expenses. LYFEN plans to expand its distribution network to 10,000 retail locations in the next 5 years, which will put pressure on suppliers to increase capacity while maintaining quality.

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    LYFEN

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    LYFEN is the largest snack food retailer in China, with annual revenue of 3.9 billion yuan. The case examines LYFEN's growth strategies in the highly competitive environment and the role of its supply chain in leveraging revenues. Following an IPO incident, LYFEN implemented strict quality control measures and increased supplier certification standards. This led to a decline in its stock price due to higher operating expenses. LYFEN plans to expand its distribution network to 10,000 retail locations in the next 5 years, which will put pressure on suppliers to increase capacity while maintaining quality.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    246 views15 pages

    Lyfen: Group No: 5

    Uploaded by

    saurabhgupta5798
    LYFEN is the largest snack food retailer in China, with annual revenue of 3.9 billion yuan. The case examines LYFEN's growth strategies in the highly competitive environment and the role of its supply chain in leveraging revenues. Following an IPO incident, LYFEN implemented strict quality control measures and increased supplier certification standards. This led to a decline in its stock price due to higher operating expenses. LYFEN plans to expand its distribution network to 10,000 retail locations in the next 5 years, which will put pressure on suppliers to increase capacity while maintaining quality.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 15
    At a glance
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    LYFEN is a leading snack food company in China that focuses on healthy, premium products. It aims to expand its distribution channels and supplier capacity to cover more of China.

    LYFEN was established in 2002 and has grown to an annual revenue of 3.9 billion yuan with over 9000 employees by producing and marketing a wide range of snacks. It is known for its focus on health, freshness and quality.

    LYFEN faced a decline in stock price after an IPO incident. It strengthened supplier management and quality control to ensure food safety from origin to customer. This increased costs and reduced profits initially.

    LYFEN

    Building a Supply Chain to Create Competitive Advantage

    GROUP No: 5

    Saurabh Gupta-25
    Hemangi Jetwani-27
    Isha Jain-29
    Ashutosh Khode-31
    M K Ravi -33
    Nikhil Marathe-35
    COMPANY BACKGROUND
     Established in 2002, Largest Snack Food Retailer in
    China.
     Annual Revenue of 3.9 Billion Yuan with more
    than 9000 Employees.
     Produces and markets roasted nuts, preserved fruits,
    meat and aquatic products, candies, jellies, puffing
    food, and other related snacks.
     Known for its Healthy, delicious, fresh & Premium
    products.
    CASE
     Growth of LYFEN in a highly competitive
    environment.
     Research & Development based on Consumer Insights.
     Role of Supply Chain in Leveraging Revenues of
    LYFEN.
     Opportunities & Challenges faced by LyFen.
     Strategy for Expansion in new regions and
    introduction of new products.
    6 MAIN HIGHLIGHTS OF THE
    CASE
    74.4% Drop in stock
    price for last
    5yrs( From ¥38.39 to ¥
    9.81)

    80.8%
    9.81
    LIMITED FUNDING SOURCES
     Following the IPO Incident, the Company management made significant changes in its Supplier
    Management System, Placing increasing focus on controlling product quality & ensuring food
    safety from the origin to end Customer.
     LYFEN Increased supplier certification & inspection standards including tracing key raw materials
    from their origin.
     After implementing these changes Lyfen was again Listed on Shanghai Stock Exchange on Oct-12
    2016.
    DECLINE IN STOCK PRICE
     Strict Quality Control measures
     Increase in operating expenses
     Decline of Net Income
    EXPANDING DISTRIBUTION
    CHANNEL & SUPPLIER
    CAPACITY.
    1)The management has plans to expand Lyfen to 10,000 retail locations over next 5 years, which
    will include expanding distribution channels and geographic footprint to cover the entire
    country.
    2)As a result, this will put pressure on suppliers to maintain quality & deliver performance,
    while simultaneously increasing capacity.
    RAW MATERIAL & FOOD
    SAFETY
     LYFEN created 24 Measures to Ensure Food Safety.(Each Incoming Shipment were reviewed
    by quality management department).
     Use of Random Sampling and Visual Method to test the raw materials.
     Use of Chemical Inspection, to test potential contaminants.
    INSPECTION OF SUPPLIERS
     Lyfen Supplier Audit was based on principles of ISO 9001, ISO22000, and the hazard analysis
    & critical control points of food safety management.
     LYFEN supplemented supplier audits with other methods of supplier monitoring, including
    independent third-party audits, real-time video surveillance of supplier facilities, and flight
    inspections.
     An important element of LYFEN’s supplier-relationship management practices was supplier
    training.
    ISSUE OF FIERCE
    COMPETITION
     Supply Chain is the core competency of LYFEN.
     Their attention to quality & food safety makes them key differentiator.
     Use of Information Technology to help demonstrate product quality to customers.
    INFORMATION TECHNOLOGY
    IN SUPPLY
    CHAIN/ LOGISTICS
    SUGGESTIONS
    Focus on
    Concentrate on Increase online
    acquisition over
    major suppliers presence
    expansion

    Drive economies
    Outsourcing
    of scale
    THANK YOU

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