Less than a year after Chinese tech giant JD.com invested $100 million in Li & Fung, the sourcing and supply chain solutions partner announced the launch of a new company, LFX, created to “capitalize on new digital opportunities transforming the retail industry and enabling supply chain sustainability.”
LFX will serve as an incubation, investment and operating platform providing digital solutions and digitally enabled services across the supply chain. Its solutions will target brands, retailers, e-commerce companies, consumer-to-manufacturer businesses and manufacturers.
Li & Fung said the offshoot’s work will aim to cover all aspects of the value chain, including trade, information and fund flows, with initial ventures focused on 3D digital product development and supply chain fintech. LFX also houses a venture capital arm to identify and invest in technologies transforming global retailing, the supply chain and logistics.
“We have established LFX as a separate company to build on Li & Fung’s supply chain knowledge to bring new ways of thinking and revolutionize how we create, make and sell products,” Spencer Fung, group executive chairman of Li & Fung and LFX, said in a statement. “Sustainable consumption starts with supply chain digitalization and LFX is forming an ecosystem that connects the innovations, people and companies committed to accelerating digitalization and transforming the retail industry.”
Ed Lam, Li & Fung’s chief financial officer since 2012 and an executive committee member of Li & Fung, will serve as CEO of LFX. He brings more than 25 years of experience to his new role, including from positions with Citi, Morgan Stanley and Coopers and Lybrand. Li & Fung is in the process of appointing a new CFO.
“Sustainable consumption requires behavioral shifts, and it starts with the supply chain,” Lam said in a statement. “Our goal at LFX is to reduce the environmental impact of our industry and promote sustainable consumption. We believe that by merging real world industry experience with new ideas that entrepreneurs and technologists bring, we get practical innovations the industry will embrace.”
After 28 years on the Hong Kong Stock Exchange, Li & Fung went private last May when Singapore’s GLP Group gained financial ownership of the business. The move, however, left the Fung Family with 60 percent of the voting shares, leaving it with effective control over the business.