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6 secret formulas behind Lativ's TWD 6 billion revenue

July 01, 2015 CK Wong Category : , , , , ,

Fresh from the previous article on Taiwan's Mayuki, let's dive into another insights to the current #1 Taiwanese online fashion brand - Lativ.

Lativ is one of our favourite e-commerce brands around, it is just like an "online Uniqlo". Personally, we have had pleasant shopping experience with Lativ as the cost performance index is satisfying (高cp值), and shipping is fast (2-3 days from Taiwan to Malaysia).

It is rare to get any insights on Lativ, until the recent trip of Michael Huang from Uitox to their facilities. Besides some photos of Lativ office (zen concept) and warehouse, it is so valuable to have the founder of Lativ, 張偉強 sharing his formula to success.

Lativ warehouse - packing

#1. Focus on product quality

Since their establishment in year 2007, Lativ never stop improving its product quality, in terms of printing, material, comfort etc.

Lativ also never stop optimizing its supply chain, and eliminate production factory which is behind the standards required.

Lativ office - from outside

#2. Maintain focus and simplicity

By bench-marking Uniqlo, Lativ focus on universal wear (for any gender, any age), nothing else, no other ventures. 

According to the founder himself, "not doing is more important than doing something" (不做什麼比做什麼重要).

For example, Lativ purely focus on operating its own online store and never sell in any e-marketplaces. This allows them to accurately control the inventory and simplify (speed up) the process.

Lativ office - zen concept

#3. Optimize process, streamline manpower

It is crucial to keep optimizing the workflow and process. In Lativ, the production efficiency is as high as 100,000 pieces of clothing per day by 60 manpower (during spring and summer).

In total, 192 employees in Lativ produce TWD 6 billion (~RM 729 million) revenue in a year, that is TWD 31.25 million (~RM 3.8 million) revenue generated per employee.

Lativ office - room

#4. Attract talents with good remuneration package

Lativ pays entry-level employees with annual salary of TWD 500,000 to TWD 1.2 million, and supervisors with annual salary of TWD 3 million to TWD 10 million. With good pay, it is more likely employees will give their best during work duties.

Lativ also practices open sharing on employees performance, so that employees can compare and motivate among themselves to improve their performance.

With good pay and efficiency in management, employees will feel more motivated and deliver higher work efficiency, thus lower turnover rate for the company.

Lativ office - meeting room

#5. Operating by numbers

From production, revenue, sales & marketing, warehouse, logistics, conversion, average order volume, return rate, picking efficiency and the list goes on, everything is being managed and operated based on numbers.

It is logical to find the problem via numbers, as numbers don't lie, and kaizen (continuous improvement) from there.

Lativ warehouse - overview

#6. Market expansion

Lativ has set China as the next key market to expand its business, targeting TWD 100 billion revenue in 10 years.

How about you? Are you contained within your own market? Do you aim big?

This article is translated and edited from SmartM, our Taiwanese content partner.


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