Chapter 304: Sales Cooperation and Re-ordering of New Ships

Chapter 304: Sales Cooperation and Re-ordering of New Ships

Chapter 304 Retail Cooperation and Reordering of New Ships

Ding Kejian said: "Mr. Yang also knows that three express trains have been opened this year. We at China Resources can put more food into Hong Kong, especially meat and vegetables, so we will sell it to Carrefour at a preferential price, but there is also a condition."

"What conditions?" Yang Wendong asked with a smile.

Ding Kejian said: "For goods from the mainland, we will give you discounts, especially meat, but Carrefour needs to give priority to purchasing meat from the mainland in the future. The same can be said for other goods."

"I can only say that we have an intention. I can't agree to the specific cooperation now." Yang Wendong paused and said, "Long-term cooperation also has to have a time limit. It's impossible to just say [later]. Generally speaking, it's more reasonable to negotiate once a year."

Ding Kejian also agreed: "Mr. Yang is right. I came here today just to reach a verbal agreement with you. There are many things involved in the follow-up that need to be discussed in detail."

"Okay, I can agree to your intention." Yang Wendong said, "As long as your price is more favorable than the market price, then large-scale cooperation is naturally possible. This is also normal business logic."

In fact, Hong Kong’s food does not only come from the mainland, but a large part of it does.

There are many reasons for this. Transportation is a big problem. Although the mainland is closer to Hong Kong, the internal transportation is poor. Although Southeast Asia is far away, the cost can be controlled if it is shipped by sea.

In the early days, such as before the 50s, Hong Kong had a small population and an underdeveloped economy, resulting in low consumption capacity. The materials supplied to Hong Kong by the mainland were sourced from nearby Guangdong Province. Even if they were transported by land, they were more cost-effective than those from Southeast Asia. Therefore, the main source was the mainland, and Hong Kong's daily consumption was also one of the main ways for the mainland to earn foreign exchange.

However, with economic development, Hong Kong's population increased and its economy became stronger, and demand exceeded the food production capacity of the eastern Guangdong Province close to Hong Kong. For this reason, the mainland had to mobilize supplies from other major cities, such as Shanghai, Hankou, etc., which led to a surge in transportation costs. In addition, due to the lack of refrigeration capacity, the cost of food loss along the way was also very high.

On the other hand, the cost of sea transportation has gradually decreased with the development of Hong Kong's shipping industry, and a large amount of food from Southeast Asia has begun to enter the Hong Kong market, especially meat and staple foods.

The British Hong Kong government was even more pleased to see this happen. They also did not want the entire Hong Kong's food source to be controlled by the mainland. Therefore, a state of competition among all parties began.

In order to earn foreign exchange, the mainland launched three express train projects to quickly transport materials to Hong Kong by train. However, even so, the cost is similar to that of Southeast Asia, and each has its own advantages and disadvantages.

At this time, we probably have to fight for channels.

Huo Yingdong laughed and said, "Haha, actually this is a win-win situation for both parties. Mr. Yang, your supermarket also needs cheap meat, and China Resources also needs more stable customers with high demand."

"Yes." Yang Wendong nodded.

When running a supermarket, what you compete on is price. Although service is also important, the final service level of most supermarkets will not be bad, after all, they are in the service industry.

Even if some new supermarkets are unable to change the arrogant pace of previous shopping malls, they will gradually be forced to reform or be eliminated by the market.

Ding Kejian also said: "Tomorrow the sales department of China Resources will visit Carrefour, and then we will ask them to negotiate the specific details."

"Okay." Yang Wendong agreed and said, "I will let the people from Carrefour settle this matter as soon as possible."

After finishing their discussion, Huo Yingdong and Ding Kejian said goodbye and left.

After getting into his car, Huo Yingdong said, "Mr. Ding, you have to seize this cooperation. I think Yang Wendong must be ambitious to use Carrefour to control the retail industry in Hong Kong. If he succeeds, then many of China Resources' future products will be very convenient to sell in Hong Kong."

Ding Kejian asked, "Doesn't Jardine Matheson also run supermarkets? With Jardine Matheson's capital, do you think Yang Wendong will definitely win?"

"I dare not say 100%, but 80% is definitely Yang Wendong's win." Huo Yingdong said with a smile: "Although Jardine Matheson has more funds, how much ability does it have? Over the years, the financial reports look better and better, but in fact it is just relying on the wealth of the ancestors.

If you study it carefully, you will find that Jardine Matheson is not good at focusing on its operations. Of course, it is not just Jardine Matheson. Other British companies are similar. They all rely on the property wealth or monopoly business accumulated by their ancestors, and rely on the development of Hong Kong and the global economy to maintain their wealth growth. "

Ding Kejian thought for a moment and said, "You are right."

Huo Yingdong added, "Look at Mr. Yang. In just a few years, he has gone from having nothing to being a leader in many industries. He is the first one to open a supermarket in Hong Kong. I don't think highly of the people at Jardine Matheson."

"Mr. Huo's evaluation of Mr. Yang is really high." Ding Kejian smiled and said, "But Jardine Matheson's Hong Kong Land and Wharf Holdings have a lot of high-quality land. This alone is an absolute advantage.

At first, China Resources also wanted to open stores to sell its own products, but it was stopped at the property stage. In the end, it could only form a joint venture with a local consortium to open a domestic store, and it had to avoid those prosperous commercial areas, otherwise the cost would not be reduced at all. "

Few people know that the mainland's domestic product stores in Hong Kong are actually joint ventures. The rent is too expensive, and China Resources cannot build so many retail outlets, so it can only cooperate with local consortiums.

Huo Yingdong followed up by saying, “This is also the only advantage of Jardine Matheson, otherwise it will 100% lose. But don’t forget that Yang Wendong also has some capital, and he will not give up the business he is interested in easily.
Besides, there are many factions within Jardine Matheson, so it is hard to say how much resources they will have to support their new supermarket."

"Yeah." Ding Kejian nodded, and then said: "However, even if Yang Wendong can win in the end, it will probably take a long time. It has nothing to do with the present. This competition may last for many years."

"Yes." Huo Yingdong said, "So China Resources needs to cooperate with him even more. If you give him more favorable goods, he will have more advantages and his purchasing demand will increase."

Ding Kejian also said: "Yes, Yifeng Supermarket of Jardine Matheson purchases a lot of their meat from Southeast Asia, but they just don't want to cooperate with us."

"British capital, that's normal." Huo Yingdong shook his head and said, "Not to mention that the prices are similar now. Even if Southeast Asia is a little more expensive, they will still cooperate with them."

"Well, and many people in Hong Kong also like to buy foreign goods, even if the prices are more expensive than those in the mainland." Ding Kejian sighed.

Huo Yingdong said: "This is actually a channel problem. Many British-owned shopping malls deliberately only sell foreign goods, or encourage customers to buy them. Consumers often have no choice."

Ding Kejian said: "So we still have to wait for Chinese capital like Mr. Yang to control the retail channels. This will be more beneficial to us at China Resources."

"Yes." Fok Ying-tung nodded: "In Hong Kong or overseas, channels are generally the most important thing. This is the opposite of the mainland."

"Channel? That's right." Ding Kejian agreed.

After Huo and Ding left, Yang Wendong also called Liu Huayu and told him what had just happened.

Liu Huayu was delighted after hearing this and said, "If our meat can also be cheap, then we can also participate in the price war to some extent."

Yang Wendong agreed and said, “Well, meat is the most in-demand commodity for people with better economic conditions in Hong Kong, and the average family’s consumption of it is not low;

If we can control this price, it will be a huge advantage.”

"Yes." Liu Huayu said: "Three express trains can deliver thousands of live animals every day. The supply in the mainland has increased significantly, so it will be no problem for us to increase the number of stores several times in the future."

Yang Wendong nodded and said, "Okay, you organize the relevant team, contact the people from China Resources, and sign a cooperation agreement as soon as possible, and then lower the price of meat in our supermarket, especially pork and chicken." These two things are always in rigid demand and are also one of the core commodities of supermarkets.

Even if the demand is really huge in the future, our group can do this in Hong Kong, because Hong Kong’s milk companies also raise cows in Hong Kong, so we can also raise other kinds of cows.

The business itself may not be profitable, but it can be used as an opportunity to stockpile land, even if it is some land that is currently in a general location.
"I understand." Liu Huayu assured.

Sunday, October 10:

Yang Wendong came to the shipyard at Zuijiu Bay in Kwai Chung. Zheng Yuhua, the head of Changxing Shipping, and several senior executives also came here.

"Mr. Yang, our new ship has entered Victoria Harbor. It is estimated that it will reach us in 15 minutes." Zheng Yuhua walked over and said happily after answering another phone call.

"Okay." Yang Wendong nodded with a smile on his face.

This is his first new cargo ship, which came to Hong Kong after being built in Japan, so there will be a celebration and naturally he, as the boss, needs to come.

After a while, a new green and white ship appeared in the distance. Zheng Yuhua said, "Mr. Yang, that is the Zhong'an, our first new ship."

"Okay, do all the shooting." Yang Wendong also said to the people around him.

"Yes." Several people with cameras and video cameras quickly began to prepare.

"Beep~~" The ship gradually approached the shore, making a surprising sound. Zheng Yuhua said again: "Mr. Yang, let's go on board for a tour."

"Okay." Yang Wendong nodded.

Afterwards, everyone boarded the ship and, led by the captain, took a tour of the entire freighter.

Yang Wendong asked: "Captain Xu, what is the focus of our first sea mission?"

Captain Xu said, "It's Brazil in South America. Japan has a lot of industrial products that will be exported to South America. On the return trip, they also need to bring back a lot of local light industrial products from South America."

"That's quite far." Yang Wendong nodded.

Captain Xu replied: "Yes, it will take more than two months to go back and forth."

Yang Wendong added: "Okay, thank you for your hard work. The supplies can be adequate. As long as there is no waste or extravagance, it will be fine."

The profit of shipping is very high, otherwise the shipping king would not have grown so fast, especially in Hong Kong, where the workers' wages are not high, even only 1/10 of those of European and American crew members.

However, in this situation, many ship owners still like to deduct some sailing supplies that do not cost much money. For some people, it is more painful for the workers to have a slightly better life than to lose money themselves.
Captain Xu smiled and said, "Okay, thank you Mr. Yang."

He had just joined Changxing Shipping and had long heard that the boss of Changxing Group treated his employees very well. What he heard today made him even more certain that changing jobs was the right choice.

Yang Wendong said again: "Well, OK, then go down, Captain Xu, thank you very much."

"You're welcome, Mr. Yang." Captain Xu was immediately flattered.

After getting off the ship, Yang Wendong asked, "When can our shipyard obtain the annual maintenance qualification?"

Ships in Hong Kong are inspected once a year. This is not due to government intervention in the market, but a mandatory requirement for safety. The same is true in other countries and regions. Otherwise, without mandatory government inspections, the movement of ships around the world will be restricted.

However, neither the Hong Kong nor other governments can do this themselves. They usually authorize some large shipyards within their own territory to be responsible for this.

Zheng Yuhua replied: "We are still applying. This involves the safety of international waters. Vessels that have been inspected by Hong Kong are also recognized by other countries. Therefore, the Hong Kong government is also very strict in its review and will not tolerate any problems. It is difficult to use connections to do this."

"You don't need to use any connections, you just need to pass the inspection one by one." Yang Wendong said: "This qualification is for our own convenience, but we must also have the ability to do it."

When it comes to safety, it is a more important factor than quality and cannot be taken lightly.

Zheng Yuhua said, "I understand. I have also invited many engineers from Taiwan and Japan. Now it's just that the dock is relatively new, and many aspects are not yet perfect. As for the technology alone, after a period of training, there should be no problem."

"Well, good, continue to train talents in various fields. In this field, technology is the main means of livelihood." Yang Wendong nodded, and then asked: "There are four more cargo ships in Japan. When will they arrive?"

Zheng Yuhua replied: "The next four ships will be delivered about once a month, and the last ship will be delivered in February next year."

Yang Wendong nodded and said, "Okay, then this matter is basically done. Next, I will prepare to purchase the next batch of new ships. This time, I plan to order large oil tankers and bulk carriers."

Zheng Yuhua was delighted when she heard this and asked, "How many tons?"

Yang Wendong said: "The 5-10-ton level depends on the needs of our future leasing customers."

The size of the ship depends mainly on demand. Super-large ships have strong oil transportation capacity and high efficiency, but they cannot pass through the most important Panama Canal and cannot get close to many seaports.

Smaller ones have greater flexibility, but the unit shipping cost is higher.

Just like large, medium and small trucks in normal land transportation, there is no absolute cost-effectiveness, it all depends on demand.

"Okay, I'll negotiate with the lessor and see what they need." Zheng Yuhua asked again: "What about the quantity?"

Yang Wendong replied: "It also depends on the demand of the lessor and the loan amount of several banks to me."

Leasing companies value experience, and Changxing Group does not have an advantage in this regard. Banks also need to control risks, and we also need to consider capital investment, so we cannot expand as we wish.

Everything still needs to be negotiated among all parties before it can be finalized.

PS: Please give me a monthly ticket
My son has tonsil inflammation and needs to be on IV drip for a few days. I'll update twice a day when he recovers and returns to normal.

(End of this chapter)