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Prize winner
Published by: RSM Case Development Centre
Originally published in: 2010
Revision date: 05-Jul-2012

Abstract

Li Ning Co Ltd (Li Ning), a Chinese sport apparel, footwear, and equipment company founded in 1989 by the Olympic gymnastics gold medallist, grew from a family business into China's number one sporting goods brand in less than two decades. Its products, generally considered price-quality bargains, were distributed throughout China. The company's ambition was not confined to the home market, however. It went public in 2004 on the Hong Kong Stock Exchange, where it raised $US 70.5 million to establish itself as an international brand, competing with brands like Adidas, Nike, and Reebok. It stepped up international marketing and exports, set up R&D centres overseas, distributed European brands in China, and sponsored international sporting events. In 2007, it made its first attempt to directly assess foreign markets by opening a flagship store in Maastricht, the Netherlands. When it speeded up internationalization by opening stores in Southeast Asia, Hong Kong and the US from 2009 to 2010, its business at home faced major challenges as competition from both international and local rivals intensified. Committing resources to internationalization therefore became harder to justify. Li Ning had to decide whether to further expand internationally and, if so, whether to remain a price fighter or develop a more differentiated strategy.

Teaching and learning

This item is suitable for undergraduate, postgraduate and executive education courses.

Time period

The events covered by this case took place in 2010.

Geographical setting

Region:
Asia
Country:
China

Featured company

Anonymous company no. 1

About

Abstract

Li Ning Co Ltd (Li Ning), a Chinese sport apparel, footwear, and equipment company founded in 1989 by the Olympic gymnastics gold medallist, grew from a family business into China's number one sporting goods brand in less than two decades. Its products, generally considered price-quality bargains, were distributed throughout China. The company's ambition was not confined to the home market, however. It went public in 2004 on the Hong Kong Stock Exchange, where it raised $US 70.5 million to establish itself as an international brand, competing with brands like Adidas, Nike, and Reebok. It stepped up international marketing and exports, set up R&D centres overseas, distributed European brands in China, and sponsored international sporting events. In 2007, it made its first attempt to directly assess foreign markets by opening a flagship store in Maastricht, the Netherlands. When it speeded up internationalization by opening stores in Southeast Asia, Hong Kong and the US from 2009 to 2010, its business at home faced major challenges as competition from both international and local rivals intensified. Committing resources to internationalization therefore became harder to justify. Li Ning had to decide whether to further expand internationally and, if so, whether to remain a price fighter or develop a more differentiated strategy.

Teaching and learning

This item is suitable for undergraduate, postgraduate and executive education courses.

Settings

Time period

The events covered by this case took place in 2010.

Geographical setting

Region:
Asia
Country:
China

Featured company

Anonymous company no. 1

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