IntroductionLi e Fung, a Chinese company founded in 1906, has experienced high growth rates through a series of acquisitions and offering a broad range of services across all elements of the supply chain (from raw material to finished product). Recently the question facing its managers is how to deal with the challenges posed by the Internet, more specifically, its website lifung.com (later renamed studiodirect.com). This company was an extension of its physical operations which allowed it to enter the SME (small and medium sized enterprise) market. What Li and Fung capabilities does StudioDirect.com leverage? Because, in the end, the company maintains its traditional mentality by simply adding a new means of doing business, studiodirect.com can take advantage of Li & Fung's traditional business and become a success. Several factors could contribute to this: • Li and Fung brand – Li and Fung's reputation is widely known and to demystify any potential fears of using the Internet it is extremely important that they rely on a well-known player in the industry with a success story.• Share Li & Fung's corporate values ​​– Although lifung.com is a new company, it belongs to the Li & Fung group and therefore shares its culture. The company's historical values ​​are, for example, pragmatism aligned with innovation. Furthermore, the company encourages diversity and communication between the group's divisions. Furthermore, the spirit of autonomy and entrepreneurship is part of the decentralized business structure. Finally, meritocracy manifests itself through a performance-based promotion and remuneration system. This set of values, if correctly interpreted by the new venture, would act as a strong… middle of paper… live price putting the company's Internet strategy at risk. • Demand uncertainty could increase volume inefficiencies – The Company's goal is to create a B2B portal that integrates orders from multiple customers. Two problems can arise if the demand forecast for this segment is not accurately estimated. In the event that demand becomes too high, the company may have short-term problems satisfying its customers in a timely manner, which would increase product delivery times and generate higher inventory levels. This happens if customers respond to this uncertainty by ordering more units at higher time intervals, causing high inventory costs and leading to customer dissatisfaction. On the other hand, if demand is too low the company is unable to generate sufficient economies of scale in its factories (or its outsourced suppliers) to generate a profitable segment.