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Li Ning: Business Doesn't Have To Be A Contact Sport

Li Ning still smiling
Li Ning still smiling
Li Yuan

BEIJING It was 30 years ago at the 1984 Los Angeles Summer Olympics that a 20-year-old Chinese gymnast named Li Ning captured three gold medals, two silvers and one bronze with an array of never-before-seen flips and twists that he had invented himself.

Li, now 50, became China’s most decorated athlete and won the title “prince of gymnastics at China’s first Olympics after having boycotted the Games for nearly 30 years.

Five years later, Li Ning founded his eponymously named athletic shoe and sporting goods company in the Pearl Delta, which would grow into China’s largest. Back in an era where materials were still scarce and brands non-existent, these locally designed products quickly became a hit.

The former gymnast had once again performed a stunt no one had ever seen.

“The reason why I wanted to start a business was simply because China didn’t have its own sporting goods companies and brands,” Li recalls.

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Photo: gilbert928

The road, however, wasn’t easy in the beginning. With his stature, Li was expected to become a coach for China’s next generation of gymnasts after his retirement from the sport. “People criticized me, saying that the nation had trained me as an athlete and what made me think I could just go off to become a businessman,” he recounts. “Anyway, nobody believed that I’d be able to create China’s own brand. I simply pursued the dream I had in my head and made it a reality.”

Li tends to change the subject when people talk about his Olympic glory. “I’m thinking about the future, not looking back.”

And to him, the country is just now hitting its stride. “China is undergoing a huge change in which the population is flowing towards the urban areas. At no other time in our history have we seen such a concentration of population and such abundance of both domestic and foreign investment capital.”

He predicts the ongoing urbanization will only continue to expand China’s domestic consumer market — and he is making sure the Li-Ning Company is best positioned to enjoy its fruits.

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A Li-Ning store in China's Hunan province — Photo: PanShiBo

And there were plenty, especially before 2012, when the company posted its first losses since 2004. Competing with sporting goods giants such as Nike has brought its challenges, but it posted a profit of more than $63 million in 2011.

Man in the mirror

For companies such as Li Ning’s the risk is that China’s market transforms quickly from scarcity to overcapacity. These days de-stocking, or reducing inventory, is important for many sporting apparel and other companies. Li-Ning is no exception. “In such a commercial context we have to complete the transformation. Make the change, as the firm’s new slogan declares, is what poses the biggest challenge these days.”

Apart from constantly readjusting its brand positioning, the priority is to constantly improve its products by increasing investment in design and development that meet the demand of China’s trend-conscious young urban population.

Li has also introduced Enterprise Resource Planning (ERP) business management software over the past few years. “This allows us to reconfigure our business model to allow us to succeed in each new round of competition,” he says. “Whereas in the past 20 years Li Ning won rather more by quantity, we are now beginning to compete both in quantity and quality.”

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The moment of glory (in company attire) at the 2008 opening ceremonies (Tim Hipps)

Li says that he has always tried to be an entrepreneur with the same mindset he had as an athlete. “I was not born to defeat others. Rather it’s because I want to stand on the podium. That’s the motivation of my survival.”

Having said that, Li’s competitive spirit hasn’t changed deep down. He succeeded in having Chinese athletes wearing China’s own brand when receiving their awards on the Olympic podium in 1992. Then, he personally lit the torch for the 2008 Beijing Summer Olympics wearing his own company’s products in front of a worldwide audience.

Today, his business sponsors numerous Chinese pro sport clubs, as well as the Spanish and Swedish Olympics teams. “I want to build a brand that Chinese people can be proud of. Sports can help people achieve things they never thought was possible.”

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As a father myself, I'm now better able to understand the pressures my own dad faced. It's helped me face my own internal demands to constantly be more productive and do better.

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But when I focus on the moment, something like a painful thorn appears in the background: from the back window of the car I see my dad standing on the sidewalk waving us goodbye. Sometimes he would stay at home. “I have to work” was the line he used.

Maybe one of my older siblings would also stay behind with him, but I'm sure there were no children left around because we were all enthusiastic about going to my aunt’s. For a long time in his life, for my old man, those summer days must have been the closest he came to being alone, in silence (which he liked so much) and in calm, considering that he was the father of seven. But I can only see this and say it out loud today.

Over the years, the scene repeated itself: the destination changed — it could be a birthday or a family reunion. The thorn was no longer invisible but began to be uncomfortable as, being older, my interpretation of the events changed. When words were absent, I started to guess what might be happening — and we know how random guessing can be.

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