The Analysis of Hong Kong Sasa’s Supply Chain and Logistics System

Topics: Supply chain management, Logistics, Supply chain Pages: 9 (2811 words) Published: December 9, 2012
The Analysis of Hong Kong SASA’s Supply Chain and Logistics System ZHANG Chaoying, WEI Xiao Beijing Institute of Petrochemical Technology, P.R.China, 102600 zhangchaoying@bipt.edu.cn Abstract:Hong Kong SASA International Holdings Limited is the largest and leading cosmetics retailing and beauty care service group in Asia. Its sale prices are much lower than those of exclusive stores and counters because it adopts the strategy of bulk purchase throught the world and marketing many brands comprehensively. This thesis, through field research, systematic analysis and hierarchy analysis,will analyze SASA’s secrets of success and challeges confronted today according to its supply chain and logistics system. Two conclusions have been drawn from the thesis: firstly, the supply chain and logistic management mode must comply with the local laws; secondly, the success of a company comes from its good supply chain and logistics system, but it can not be copied at will. Keywords:Hong Kong, SASA, Supply Chain, Logistics System

1 Introduction
Research on Supply Chains and Logistic Management first originated from USA. So far, the research development has gone through the following three typical phrases: earlist “Transportation”, then “Logistics”, and latest “Supply Chain Management (SCM . Since 1990’s, the two concepts, Logistic Management and Supply Chain Managemen,Coexist. At the same time, there are mainly four argument: (1) Traditionalist,who belives that SCM is just the organic ingredient of Logistic Management; (2) Relabeling, who argues that the two are the same thing with different names; (3)Unionist, who believes the category of SCM is wider than that of Logistic Management, which is opposite to the Traditionalists’ view; (4) Intersection ist, who thinks the two are different displines but overlap. The four totally different arguments indicate that the the two concepts have not come to a consensus, with respect to the knowledge system, theroy system, and fuandation of the displines. In this paper, Supply chain is defined as the logisitic network, composed of suppliers, manufacturers, warehouses, distribution centres, chanel sectors, etc.. Supply chain management (SCM is the integrated management philosophy and methods, which execute the plan and control of logistics from suppliers to end users. Based on the above-mentioned definition, the paper hold the point that Logistics is a significant component of Supply Chain. At present, most of the research on SCM and Logistic management are about entreprises’ basic business processes, the design of Supply Chain, the operating model of Supply Chain, collaborating partner relationship, and so on. The paper took the supply chain and logistic management system of Hong Kong SASA for intance, intended to discuss the influenc of different legal framework on enterprises’ supply chain and logistic management mode, then to reveal the fact that compliance with local laws underlies the sucessful supply chain and logistic operating mode.

2 Background of Hong Kong SASA
Guo Shaoming and his wife, Luo Guizhen, founded “SASA”in an underground wharehouse rented with 20,000 HK dollars in 1978. At the beginning, their store was just a cosmetics retailing counter of no more than 5m2. With the idea of more sales for less profit, they stocked cosmetics and skin-care products of different brands from agents and sold them at discount.

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At that time, the cosmetics market in Hong Kong was much like the one in mainland today, ordinary cosmetics went at high price for high profit. Cosmetics could only be found at counters in department stores which charged admittance fare and commission from the sale. To save expenses, most of SASA’s counters were located in the stores on the steets with many people, and in this way, SASA spared the admittance fare and commission deducted by department stores, with a lot of customers patronaging. If it sold all articles of different brands at the same...

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