Southern Pharmaceutical Factory, in the small conference room.
Lin Sanqi was looking through last month's account book. Lin Tianhua, Yin Lianyi, Huang Yushu, manager of the Southern Pharmaceutical Factory, and Zhong Yangyang, head of the factory's finance department, were sitting on both sides.
Lin Sanqi frowned as he looked at the account book. Finally, he closed it, sighed, and said unhappily:
"Old Huang, you lost 20 million last month. I'm very dissatisfied with this. Such a big factory, and you only lost so little?"
Yin Lianyi rolled her eyes after hearing this, feeling both angry and amused.
Huang Yushu and Zhong Yangyang were very embarrassed: "Boss, how about you give us some advice? How can we make more money every month?"
Lin Sanqi pointed to the purchase account book and said:
"Come, take a look. The raw materials for this tuberculosis drug cost 500,000 per ton. Are you going to be so honest? Just buy it for me at the lowest standard?"
Huang Yushu was almost crying: "Boss, I strictly control the purchase of goods just to save costs for the company."
Lin Sanqi said unhappily:
"It's right to save costs for the company, but that's not the way to do it. You should know that what I want is for you to create a loss on paper. Of course, you don't want to make a real loss for me and put the money into your own pocket."
Lin Tianhua wanted to laugh but didn't dare to. He felt that his cousin spoke like a tongue twister, which ordinary honest people really couldn't understand.
Lin Sanqi thought for a moment and said:
"So, for the raw materials for tuberculosis drugs, you can go talk to the supplier and ask them to charge me 2 million or even 5 million per ton. The invoice will be issued at that price. Southern Pharmaceutical Factory will cover any extra taxes and fees. Whoever can issue the higher invoice will be the one we buy from in the future."
Issuing false invoices and over-reporting purchase prices are what every company boss fears the most, because it means that the purchasing agent is taking kickbacks.
But Lin Sanqi strongly encourages such behavior, so that the tax authorities and accounting departments can calculate based on the book funds.
The higher the invoice price, the higher the purchase price will be, so the loss will be magnified tenfold.
As for why the purchase price of raw materials has suddenly increased tenfold, what should pharmaceutical companies do with such a price increase in the international raw material market?
If this excuse doesn't work, then Southern Pharmaceutical Factory insists on using the best raw materials to make the best conscientious medicines, is that okay?
Huang Yushu nodded repeatedly when he heard this:
"That's fine. From now on, we'll use the raw materials from whoever can issue more invoices. That's OK."
Zhong Yangyang, the head of the Finance Department, quickly took a pen and wrote it down.
Lin Sanqi continued to offer advice:
"I have another order for 2.5 million bottles of penicillin. I was originally planning to purchase it from outside, but now it seems that we should produce it ourselves. After all, it is a basic drug and it is not difficult to produce.
Then it's the same old routine: you produce according to the standard of 5 million bottles, and continue to issue fake invoices for all raw materials. On paper, you can produce 50 million or 100 million bottles of penicillin, but in the end, if you can't sell them, you will lose all the money!
Huang Yushu continued to take notes and added a new penicillin production line.
At this time, Zhong Yangyang reminded:
"Boss, penicillin and anti-tuberculosis drugs are both very basic medicines. Their prices are too low, and we can't falsify the prices of our raw materials too much. Should we develop a few more drugs? For example, more expensive ones, so that the cost can be increased."
Lin Sanqi thought of another thing:
"Dr. Xiang from the Huadu Medical University School of Traditional Chinese Medicine asked if the special production license he applied for us has been approved?"
Huang Yushu was following up on this matter and replied:
"A total of three documents are required. According to the reply from the dean of the School of Traditional Chinese Medicine of Huadu Medical University, the licenses from the State Administration of Traditional Chinese Medicine and the China Food and Drug Administration have been obtained. The only thing missing is a license from the State Forestry Administration."
Lin Sanqi nodded:
"Stop making trouble. Anyway, our Southern Pharmaceutical Factory already has a license for the production of traditional Chinese medicines, so you can prepare the medicine in advance, such as purchasing a batch of natural musk from the Qilian Mountain Musk Deer Breeding Base in Qinghai Province.
The market price of this farmed musk is about 600 to 1,000 yuan per gram, but the musk from the Qilian Mountain Breeding Center is purchased at a standard price of 5,000 yuan per gram because of its good appearance, high purity and strong medicinal effect.
You buy 20 kilograms a month, isn't that a lot? That's almost 100 million yuan. After we officially start production, can we buy 50 kilograms a month? That would mean a loss of several hundred million yuan a year, right?
Huang Yushu continued to nod: "Yes, yes, yes. Similarly, we also need to purchase natural bezoar, rhino horn and other traditional Chinese medicines. That means we can lose at least tens of billions every year!"
Lin Sanqi was happy:
"Yes, that's right, that's the idea. The Angong Niuhuang Pills we make will be sold for 50,000 yuan each, but the production cost for our pharmaceutical factory will be 48,000 yuan, so we'll make a profit of 2,000 yuan.
If the price of raw materials continues to rise, we will be selling at a loss, purely for the sake of reputation. Then not only will the pharmaceutical factory's accounts be in trouble, but the Lingnan Hall Chinese Medicine Clinic's accounts will also be very bad. How great! "
Yin Lianyi couldn't hold back her laughter any longer:
"I'm dying of laughter. The Qilian Mountain Musk Deer Breeding Base and the newly opened Qilian Mountain Ten Thousand Cattle Breeding Base are actually still owned by our Lingnan Hall Company. It's like switching from one hand to the other."
Lin Sanqi coughed lightly:
"These breeding bases all operate independently. Besides, if word spreads that musk deer and cattle breeding in the Qilian Mountains is so profitable, it could boost the local industrial chain, contributing to impoverished areas."
The farm makes a lot of money, and the larger the invoice amount it issues, the more taxes it pays, but this part of the taxes and fees goes to the local government.
This is also a disguised way for Lingnan Hall to help poor areas get out of poverty.
When the local government's finances become dependent on these two breeding bases, it will absolutely do its utmost to protect these two bases from being targeted by others and will protect these two companies.
Lin Sanqi then pointed to the research funding and said:
"We plan to produce four medicines: Angong Niuhuang Wan, Pianzaihuang, Aoaojiao, and Duanxueliu. However, these four medicines cannot appear out of thin air. Do they require long-term laboratory research?
The newly established Southern Pharmaceutical Institute can now focus on research and development, right? Ni Shenbao, Li Yifan, and Shi Zitong are all doctoral students. Let them recruit a few more graduate students.
Drug research and development is the most expensive, so Director Huang, you should think of a solution from here. Scientific research expenses are the easiest to falsify anyway. No one knows where the money is spent, and experimental supplies are used like water.
"So, your pharmaceutical companies are investing 500 million or 1 billion yuan in R&D every year. You can make it up as much as you want, and the higher the cost, the better. Of course, this is fake spending, so please don't do anything to make it real."
Director Huang was panicking: "Boss, our pharmaceutical factory is in the red on paper. How can we account for hundreds of millions or even billions of dollars in losses?"
Lin Sanqi didn't think twice: "Loan!"
"You can use the Southern Pharmaceutical Factory as collateral to get a loan, right? If the Southern Pharmaceutical Factory becomes insolvent, Lingnan Hall Chinese Medicine Clinic is also a fixed asset that can be used as collateral. At worst, I can pay the bank a certain amount of interest every year, which I can consider as protection money."
Lin Tianhua interrupted at this time:
"Director Lin, weren't you worried that we'd over-borrow? If Lingnan Hall were targeted, they'd force the bank to let us withdraw money to repay the loan, driving us into bankruptcy and forcing us to sell our ginseng and cordyceps at a low price? Why are you insisting on taking out a loan now?"
There are many ways for capital to attack a company.
One is that the tax, environmental protection, fire protection, land, drug supervision, etc., come to check on you all day long and find fault all day long, and there will always be loopholes in your company.
Another is financial manipulation: if you want a loan, they won't give it to you; if you have a loan, they'll ask you to repay it early; if you want to go public, they'll reject your application. The goal is to cut off your funding chain.
Often after these few moves, a company is almost finished.
Isn’t this how the richest man Wang was brought down? His funding chain was broken, the bank demanded payment, and he was forced to sell his assets at a low price to pay off his debts.
But Lin Sanqi is not afraid, because he is not really short of money.
He borrowed 2 billion or even 5 billion from the bank. The annual interest would be a huge sum of money, which would make the entire Lingnantang company's account look very ugly.
It gives people the impression that no matter how much money you make selling ginseng and cordyceps, it is useless because the pharmaceutical factory is suffering huge losses and is insolvent.
This gave some investors the false impression that the young boss of Lingnan Tang had ambition but no ability, and that the acquisition of Southern Pharmaceutical Factory was a failure, leading to years of losses for the company.
How wonderful! (End of this chapter)
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