When the business was founded in 1945, logistics was then known as warehousing and shipping. Today, on the eve of its 60 anniversary, the Sun Hing Group is a model of how businesses can ensure a bright future for themselves by embrace change. This is clearly illustrated in the group's latest business venture, Sun Logistics, a 50:50 joint venture with Sun Hung Kai Properties, which Ms Lee has steered as General Manager of the company since its establishment in 2000.

She says the partnership is a continuation of a close working relationship that the two partners have enjoyed since the mid-1980s, which sprung out of a casual chat between the Chairman of Sun Hing Simon Lee and the late Chairman of Sun Hung Kai Properties Kwok Tak-seng at a dinner reception. At the time, Hong Kong manufacturers were migrating north, and in their wake many godowns were left abandoned. The late Mr Kwok asked Mr Lee if he had any use for a warehouse he had in Fo Tan, and after further meetings the two entrepreneurs decided to form a warehousing joint-venture which continues to this day.

Towards the end of the 1990s, warehousing and shipping was starting to become a fine art. "In the late 1990s, we looked at supply chain management trends in the U.S. and Europe, and realised the logistics business was undergoing an evolution," Ms Lee said.

The rise of e-commerce triggered the shareholders to think how they could get involved in this business by offering one-stop solutions for inventory management, delivery and packaging by making full use of information technology.

"The shareholders originally thought of calling this new business Sun Hing Warehousing, but thought that it sounded rather old fashioned," she says. "In the end, we decided to form a new company with a totally new image and in May 2000 Sun Logistics was born."

The biggest hurdle for the company was -- and remains -- convincing businesses that supply chain management is essentially just a new, more efficient way of doing an old business.

"We spend a lot of time talking about supply chain management and outsourcing logistics tasks, but many businesses still don't appreciate the fact that if you want to succeed in business you have to carefully monitor your inventory," she says. "In this regard, we are still behind Singapore and Australia when it comes to supply chain management and logistics development."

Another challenge was people's unrealistically high expectations about "e-logistics." Because the company was born at the time of the dot-com bubble, businesses thought that they could track every product in real time and that consignments would arrive at their destination overnight, she says.

RFID: The next big thing

The hottest topic sweeping through the logistics industry today is radio-frequency identification (RFID) -- a technology that will allow companies to pinpoint the exact location of their goods at any time, anywhere in the world -- says Ms Lee. Logistics companies are already on cloud nine dreaming up uses for the breakthrough technology, but when ubiquitous RFID arrives in the next few years, most Hong Kong SMEs will not be able to take advantage this marvel of ingenuity.

The good news -- ironically -- is that the cost of implementing RFID is still prohibitively expensive, even for large firms. She expects the cost will drop in three years to a level where it will be more cost effective. During this time, SMEs will have a window of opportunity to put their inventory control systems in order and catch up to a level where they will be able to use RFID.

Companies are increasingly coming to grips with inventory management as they look at different areas to save costs, says Ms Lee. However, SMEs are often reluctant to ask for assistance, as they think logistics service providers are only interested in working with larger businesses.

"We are a bit different from other logistics companies, as besides multinationals, one of our most important markets is the SMEs," she says. "Their needs are usually quite straightforward, and as we provide almost every service SMEs need -- warehousing, inventory management, various packaging solutions, distribution, customer service, and e-logistics development and support -- the efficiency and benefits that we can provide to SMEs are far more significant that those of big companies. So at the end of the day, we can provide them with the services that they require at minimal cost."

She also believes that many SMEs are cautious about enquiring about such services after being burnt by unscrupulous software vendors.

"Many SMEs didn't get what they paid for, so their software ended up just sitting on the shelf," Ms Lee says. "In my view, it is critically important to have the right business knowledge. You cannot simply buying off-the-shelf software to manage your company's logistics needs, it has to be tailored to your own circumstances. And because many SMEs do not have an IT manager in house, they are often at the mercy of these companies that sell "solutions" and leave the SMEs to figure it out themselves."