Cost Management Study For Ganfeng Lithium

Since the beginning of the21st century, lithium has become the core resource in newenergy, new material and new pharmaceutical field. Thanks to the high demand fromdown-stream industries, lithium processing industry develops rapidly. More and morecompanies and investors are attracted into this industry by the optimistic future prospectsand huge business opportunity, leading to fierce competition in domestic and internationalmarkets. Under such circumstances, domestic companies must seek approaches to survivaland development. Strategic Cost Management (SCM) maybe a good option.In this paper, a listed company, Jiangxi Ganfeng Lithium Co., Ltd.(referred to asGanfeng Lithium hereinafter) is the sample for this study. Based on the theory of SCM,this paper first analyzes the value chain of Jiangxi Ganfeng to identify its key links and toclear the relationship between value activities. We hope to adjust the link between valueactivities to reduce costs for companies and to enhance cost and competitive advantages.By comparing the factor loadings of the six factors with industry norms, it makes aproposal for further improving the cost control effectiveness.The study and analysis play a very important role in designing a solution plan forJiangxi Ganfeng. The proposal may not only be a possible solution for Jiangxi Ganfeng,but also a reference for other players in China’s lithium industry.