Chapter 446: Change of Strategy
Chapter 446: Change of Strategy
Dugu Tuo groaned for a moment and said, "Xiao Xia is a big businessman. His Xihai Commercial Bank has set up a business in Luoyang in advance and is now the largest commercial bank in Luoyang. Now that he controls Jiangnan, he must seek profits in Jiangnan. You may not know that the newly established Nanfang Commercial Bank, which specializes in selling bulk goods, was jointly established by Xiao Xia and the Xiao family in Jiangnan. It is also engaged in the grain, oil, cloth and silk business and competes with us.
The salt profits in Jiangnan are so lucrative, how could Xiao Xia not see it? When he founded the Southern Trading Company, I guessed that he wanted to share a share of the salt profits. It seems that he only deals in refined salt, not crude salt. "
Yuanshou said anxiously, "It's understandable that he wants to share the salt profits, but his refined salt is only 20 coins per pound, so our coarse salt is finished."
"How can it be over? He lowered the price, so we lowered it too, the price of crude salt was reduced to five cents a pound, and we also made refined salt, the same as him, at twenty cents a pound."
Yuanshou sighed and said, "Brother, he opened stores directly in various counties, bypassing the local salt merchants, so the cost can be reduced. We rely on local salt merchants to sell, five cents a pound, which is sixty cents a bucket.
Then the local salt merchants would earn at least 30 wen per bushel, and even 30 wen might not be enough, they would have to earn 40 wen per bushel. Add to that the interests of the salt households and the three companies, and our profits would basically be gone.”
Yuanshou's calculations were very clear. With too many middlemen, it was simply unrealistic to sell at five cents per pound.
Dugu Tuo nodded, "You are right. There are too many people among us who share the profits. If we want to compete with Xiao Xia, we have to open a store and sell directly like him. Please gather all the families and let's discuss it tonight!"
At night, more than a dozen Guanlong noble families with interests in Jiangnan gathered at Dugu Mansion.
Over the years, every household has made huge profits from Jiangnan, but not all families are related to salt. There are only nine families related to salt profits, and the other families are involved in goods such as rice, cloth, and silk, but they also face strong competition.
In the hall, everyone argued for a long time. Dugu Tuo couldn't help but waved his hand and said, "Don't argue anymore. There's no point in arguing. I'll come up with a few plans. Everyone, please add to them. If they are suitable, we will implement them."
The hall fell silent, and Dugu Tuo slowly said, "The current situation is that Xiao Xia has established the Southern Commercial Bank to do bulk cargo business, and is in commercial competition with me. This is not a big problem. We have market advantages and we will make more money, so we should not worry about the bulk cargo business.
The key is salt. There are good news and bad news. The good news is that Xiao Xia is making money by selling salt in Jiangnan, not the government implementing a salt monopoly. Since he is making money by doing business, then our business can continue, that is, competition between the two sides. But the bad news is also competition, and we are at a disadvantage.
First of all, the source of salt. Xiao Xia got the official salt from Jiangdu through the emperor, so our source of salt will be greatly reduced. This is the first major disadvantage.
The second is that he is expanding too fast, we are slow and the news is delayed. Xiao Xia has long been deployed in Jiangnan through his Xihai Trading Company. The salt markets in Wujun and Pilingjun have been taken away by him, and we know nothing about it. This is our second biggest disadvantage.
Finally, our cost is too high. He prices refined salt at 20 wen per catty, while our coarse salt costs 10 wen. We simply cannot compete with him. We can also choose to lower the price, but once we do, we will lose all our profits. The main reason is that we have too many intermediaries, which is our biggest disadvantage. "
"Brother Dugu, what should we do then?"
Dugu Tuo waved his hands and said with a smile: "Everyone be quiet and listen to me slowly!
Now that we know the disadvantages, let's solve them one by one. First of all, there is a shortage of salt sources. We can't expect Xiao Xia to share the official salt with us. We can only rely on ourselves. Our salt fields produce 300,000 shi of salt each year, and the official salt fields produce 800,000 shi of salt each year. Of course, this is easy to solve. If it doesn't work, we can increase production or transfer salt from the Hebei salt fields. I don't think the salt source problem is big.
Another disadvantage is our slow action and reaction. This is because Yuan Min was transferred away. It is also easy to solve. We can directly establish a salt business in Jiangnan. We no longer need to make decisions through Luoyang. We can make decisions directly in Jiangnan.
The most troublesome thing is the third disadvantage. Xiao Xia directly takes the salt and opens a shop to sell it to the people. All the salt merchants in the middle are gone. If we want to compete with him, we have to do the same. The problem is what should we do with the second-level and third-level salt merchants we have cultivated over the years? Everyone, please speak up! " Dugu Tuo's words basically said everything, and also said the root cause. There are too many intermediate links and the profits are divided. Everyone was silent for a while.
At this time, Yuanshou said slowly: "When we first entered Jiangnan, we were unfamiliar with it and faced challenges from the Jiangnan families, so we cooperated with the local snakes in Jiangnan. But five years ago, we had already established a firm foothold in Jiangnan and could have opened a store ourselves. It's just that we took care of our cooperation for many years so that they could continue to have a bowl of rice to eat. Now our own rice bowls are about to be smashed, how can we take care of them? They have made enough money over the years. Every family has a restaurant and a store, and there is land in the countryside. They can live well without the salt business, so I suggest that we leave them alone and do it ourselves!"
Yuan Shou's words spoke for everyone, and everyone said, "Our own interests are important, so don't worry about them!"
In fact, Dugutuo and Yuanshou had already discussed it. They gathered everyone together just to inform them and asked each family to express their agreement to avoid jumping out and saying that they knew nothing.
Seeing that everyone agreed, Dugu Tuo said, "Since everyone agrees, let's come up with a plan and start implementing it after everyone signs!"
At this time, Houmo Chentai raised his hand and said, "Let me add one more thing. Xiaoxia sells refined salt for only 20 cents per pound. Is there any point for us to continue selling coarse salt?"
Dugu Tuo nodded: "Whether we sell refined salt or coarse salt, it's just a matter of product. As long as we have the capital down, if refined salt is popular, we can also sell refined salt at 20 wen per jin. Even if our cost of refined salt is 100 wen per dou, we can still make 140 wen per dou. It's not a big problem. The key is to kick out the middlemen, open a store directly, reduce the cost to the same as Xiao Xia, and then we can continue to make money."
Everyone reached a consensus, and Dugu Tuo presided over the drafting of a "Jiangnan Salt Industry Response Plan". Everyone came forward one by one to sign and seal, authorizing the Dugu family and the Yuan family to fully implement it.
The Jiangdu County of the Sui Dynasty had a very large jurisdiction area, extending from the sea in the east to today's Chuzhou, Anhui in the west, to the Huai River in the north, and not the Yangtze River in the south. It also included today's Zhenjiang. It was definitely the largest county in the south of the Yangtze River. Of course, its area was smaller than that of Jian'an County, which was a province of Fujian today.
The southern camp of the Jiangnan military camp was located in Yanling County on the south bank of the Yangtze River, also known as Jingkou County. In today's Zhenjiang, nearly 20,000 soldiers from the government were training here.
There were shouts like thunder in the camp. Twenty thousand soldiers were conducting military confrontation training. Two armies of ten thousand people were holding blunt spears and constantly changing their military formations to disperse and divide the enemy, and then annihilate them.
Xiao Xia stood on the high platform, silently watching the confrontation training on the martial arts field. One team was led by Sun Lei, and the other was led by Xue Wanche. Neither of them had cavalry, but only infantry.
Luo Shixin said solemnly, "General Sun Lei's troops train very hard, five hours a day, and they often conduct military confrontation training internally, so it can be seen that each soldier's position and physical strength are very strong, and the formation is also very skilled. A team of 100 people will never get separated during the constant running."
Xiao Xia nodded. It could be seen that Sun Lei's army had a strong sense of collectiveness and the soldiers had good individual qualities. They suppressed Xue Wanche's army and could be considered an elite force.
Of course, Xue Wanche’s army was also good, just slightly inferior to the enemy.
Xiao Xia said to Luo Shixin: "The next step is actual combat training. You will take 20,000 troops to Poyang County and Yuzhang County to suppress the bandits. Don't underestimate the enemy."
Luo Shixin nodded, "Please rest assured, Your Highness. I will not let you down!"
(End of this chapter)