Chapter 424 The beginning of investment in Europe
Chapter 424 The beginning of investment in Europe (asking for monthly tickets at the beginning of the month)
At present, Walmart’s influence on Changxing Group is not that great, after all, its scale is still limited; however, its growth potential is very strong, especially now that it has already invested and has no shortage of funds, it can be said that it is like a fish in water.
Therefore, at this early stage, if Changxing Trade can get its daily necessities orders, then there is a promising future. You know, in the past, when Walmart was at its peak, it had orders of about 100 billion US dollars a year, which were all given to some trading companies. This was also because there were too many products and Walmart's senior management had limited energy.
With the help of Walmart's orders and its own Carrefour, it will be possible to strictly control the cost of the procurement chain, so that it will have the opportunity to enter supermarkets in other markets, such as Japan, which is almost impossible to enter, or Europe, which is difficult to enter. In this way, although it is difficult to open supermarkets in these places, it can indirectly obtain the profits of the supermarkets.
On December 12, things happened in the United States, and Yang Wendong took a plane, not directly back to Hong Kong, but to London, England.
At the airport, an acquaintance was already waiting there.
"Old Wei." Yang Wendong greeted him with a smile, "How long have you been in London?"
Wei Zetao said: "It's been almost 10 days."
"10 days? Are things at the factory almost done?" Yang Wendong asked.
This time I came to London because the United States is relatively close to the United Kingdom, so I came to take a look. One of the things I wanted to do was to invest in a factory of Changxing Group in the UK. This investment was not purely for economic reasons, but was similar to a ZZ transaction.
Wei Zetao said: "Yes, it has basically been negotiated. According to your request, the recruitment of workers for our factory is completely in our hands."
"Okay, as for other aspects, as long as they are reasonable, it will be fine." Yang Wendong nodded and said.
This investment has actually been calculated before, and it may be profitable because the goods produced are also for supply to Europe. Although European wages are not low at that time, the cost of ocean transportation is also high. For some goods that are not suitable for sea transportation, investing here is also economically viable.
Wei Zetao smiled and said, "Okay, let's go to the hotel. You can take a rest here. I will report the details to you tomorrow."
"Okay." Yang Wendong nodded. It took six or seven hours to fly from the United States to London. It was already afternoon, and it was almost time to rest.
The next day, Wei Zetao and Yang Wendong came to a small conference room in the hotel to discuss the investment in the UK.
Wei Zetao said: "According to our agreement with the British government, the total investment amount is 150 million pounds, but this is just a nominal amount, and there are many aspects that can be manipulated."
"What do you mean?" Yang Wendong asked.
Wei Zetao smiled and said, "We can buy equipment from Dongsheng at a low price and then ship it to the UK. The price quoted is the price in the UK, and other aspects are similar. So it looks like 150 million pounds, but in fact, it is only about one million."
"Won't the British government investigate if we travel like this?" Yang Wendong asked curiously.
Wei Zetao said: "The inspection is also random, so our offer in the UK cannot be too outrageous. If it is in line with the offer in Europe, then there will be no big problem. In fact, this situation always occurs in cross-border investments, and the governments of various countries are tacitly aware of it. After all, it does not harm them. If this is really not allowed, who will come to invest?"
"Haha, that's right. So many international companies are not pushovers either." Yang Wendong said with a smile.
Wei Zetao added: "For the British government, they value the jobs we create and the long-term economic benefits in the future more. We did not lie to them about this.
At present, the first phase of the plan will recruit 350 people. Several products we produce will be directly put into the British and European markets, and even sent to the United States by container in the future. It is much more convenient to depart from here than Hong Kong, especially in the eastern United States. "
"Well, this is also the benefit of investing in Europe." Yang Wendong nodded and said, "Hong Kong will not engage in containers in the short term, so this area will be quite troublesome in the future."
In fact, Governor Trench already had plans in this regard. Market rumors said that traditional dock companies such as Jardine Matheson, Swire and Whampoa had already held meetings with the Hong Kong government. Everything was proceeding step by step. Hong Kong's rapidly developing industry could also gradually solve the employment problems of a large number of traditional dock workers.
However, the outbreak of the future economic crisis has put all major plans on hold. After all, the Hong Kong government has no money, and private capital does not dare to make such radical investments during an economic crisis. Not to mention the port, even the Hung Hom Cross-Harbour Tunnel, which was about to be approved, has been stopped.
It was not until after the economic crisis that the construction of docks and tunnels began in 1970. It was not until 73 that the first dock was successfully completed, which was nearly ten years. All industries suffered heavy losses during this period. Otherwise, Hong Kong's industry might have been stronger.
Wei Zetao said: "Perhaps we should increase investment in Taiwan and Singapore. These two places have lower costs and both have plans to build container terminals. If there is any new production capacity in the future, we can consider going to these two places."
"Yeah, I think so too." Yang Wendong nodded and said, "They are all Chinese territories, and are suitable for our investment. The scale of our industry in Hong Kong is already too large. Let's not talk about the existing ones, but the additional ones in the future will also need to be produced overseas." Hong Kong has only about 350 million people, and this population is not suitable for continued investment. In the early days, I was very active in building factories in Hong Kong. In addition to its own needs, helping Hong Kong's poor to get rid of poverty was also one of the purposes. But now Hong Kong's economy basically will not let people go hungry or extremely poor, so the task I set for myself has been completed. In the future, I will just follow normal business logic.
Taiwan has a larger population and Singapore has a better location. These two places are the future Four Asian Tigers. The real estate industry or local service industry will be among the top in Asia in the future, and are also very suitable for your own investment.
Wei Zetao smiled and said: "Okay, then when we expand the production capacity of our factory, we will consider these two places."
"Taiwan is the priority. We will wait until the political situation in Singapore stabilizes before we talk about it." Yang Wendong reminded again: "In the future, our capital will never go to places with political risks."
"Understood." Wei Zetao agreed.
What capital needs most is stability. If a place is in chaos, even if the government saves foreign companies, various suppliers, workers, and transportation will be in chaos, and they will not be able to operate.
Yang Wendong went on to say: “We will do this for the UK first. If we find that there is great potential for investment in Europe later, we will consider increasing investment in the future, but not necessarily in the UK. We will see when the time comes.
We have been making money in Europe and the United States over the years, and we need to invest here to stabilize the market.”
Business is about buying and selling. It has to be both buying and selling. If you just keep selling, problems will arise sooner or later. Therefore, even Haier and Midea, large domestic home appliance companies in the past, would build factories overseas. One reason is that it is cost-effective, and the other is that it is also a kind of exchange of interests. Small companies don’t care about this, but large companies must consider it, especially when they need to invest in some local service industries in Europe and the United States.
"Okay, if we control employment in Europe, it will be easier for us to open up their market." Wei Zetao said with a smile.
Yang Wendong asked again, "How is the situation of Tesco in the UK that I asked you to investigate going?"
Wei Zetao said: "I sent someone to ask, but they don't accept investment. Tesco has been in the UK for decades, and the shareholders behind it are quite powerful, so it's a bit difficult to buy shares in them."
"Forget it then." Yang Wendong said, "Continue to collect some information about British companies."
Tesco will indeed be a pretty good supermarket in the future. It would be great if he could invest in it, but it doesn't matter if he can't. After all, there were so many top supermarkets in the past, and it's impossible for him to invest in all of them, especially since he is a "foreign capital" himself. He might only consider those newly established small businesses.
"Yes." Wei Zetao said.
"Yeah." Yang Wendong was about to say something when suddenly there was a burst of noise coming from outside.
Wei Zetao quickly explained: "Mr. Yang, the British people have been making trouble recently. There have been conflicts between local white people and foreign immigrants and some leftists. It's getting out of hand. Even the government is arguing over whether to accept immigrants. It's very chaotic."
"We don't care about that." Yang Wendong added, "Our factory will only hire local white people in the future, not Indians or blacks. I would rather pay them a little more than have them make trouble, and we must not have any quality problems."
The British government has been in chaos in recent years because of a shortage of people in the mainland after World War II. In order to win over the colonies, the government introduced a policy: colonists can also come to the UK freely and obtain British citizenship.
Therefore, a large number of people from the colonies came to make pilgrimages, especially some blacks and Indians, who could not make it in their home countries and came to Britain. Then the end of Britain can be imagined. And because there were too many immigrants, these immigrants formed their own interest groups, which led to huge conflicts with the local white people.
This can be considered as a sequelae of the British Empire's former colonization of the world.
Yang Wendong naturally didn't care about this kind of thing, but his experience in his previous life told him that he would never hire Indians or blacks to open a factory. He would rather hire white people. These white people may not be as hardworking as the Chinese, but at least they are not so ruthless.
"Why not give priority to Chinese people? There are quite a few Chinese people in the UK," Wei Zetao suggested.
"No, this factory itself has more political significance than economic significance. Let's just hire white people." Yang Wendong shook his head and said, "The Chinese in the UK have nothing to do with us. Why should we take care of them?"
"Okay, I understand." Wei Zetao nodded and agreed.
Yang Wendong went on to say: "Then let's build this factory as soon as possible. With this, it will be much easier for us to enter Europe in the future."
Any capital that is large enough will be diversified, not only into industries but also into assets. This is a way to avoid risks. Even if you are a time traveler, you can at most invest a little more in areas that you know are not problematic, but you will not invest only in these few places.
Europe, the United States and the United States will always be the world's largest consumer markets in the next few decades, and they are also the forefront of many technologies. For example, in the field of home appliances and electronics that I will invest in in the future, many technologies were born here. Therefore, I also need to gradually make appropriate investments in Europe and the United States.
PS: Ask for monthly tickets at the beginning of the month
(End of this chapter)