Lu Feng left the mall and wandered around for a while, inquiring about the inventory of other stores. A large batch of goods would arrive tomorrow.
Back in the car, Lu Feng sat in the back seat, broke the VCD player he had bought, and took out the motherboard inside.
"Why would you break it?" Feng Zhiyao asked, puzzled.
Lu Feng stared at the motherboard's circuitry for a while, then grinned and handed the motherboard to Feng Zhiyao.
Feng Zhiyao examined it for a while and exclaimed in surprise, "Misprinted? They're producing nothing but misprinted versions?"
“I don’t know how many manufacturers are producing them now, but these blueprints are being sold like hotcakes on the black market. This is the second trap I’ve set for them!” Lu Feng smiled, pursing his lips.
“If they mass-produce and stockpile, preparing to crash the market and gain a foothold, the losses will be too severe. We can continue production and probably occupy the market for a while.” Feng Zhiyao became happy and said, “This time difference is enough for Jinbao to gain a foothold.”
Lu Feng nodded and said, "However, we should avoid their sharp edge for the next two days and reduce production to prevent excessive inventory and cash flow problems. Such large-scale production will inevitably involve a large number of raw material processing plants. When the market is large enough, the competition will be extremely fierce."
"When you see that the finished products have become highly competitive in the first market, then the second market must have become extremely competitive. Competition in the second tier will lead to a drop in prices for suppliers, which can be considered a benefit."
Feng Zhiyao thought for a moment, and these words corresponded perfectly to the three-tier market he had learned about: the material market, the processing market, and the finished product market. One wave drives another, and they are all interconnected. An initial rise in material prices would lead to a rise in the material processing market, which would then affect the finished product market.
If the secondary market experiences significant stagnation and the primary market cannot absorb the excess, price competition will emerge. As long as the spillover materials cannot be consumed, the finished product market will not be affected by fluctuations in the price of the initial materials.
"Let's go back!" Lu Feng said to Feng Zhiyao, "Stop grinning like an idiot."
"Brother Feng, I have a question. If I bring in 300 million now, can I get 5% of the original shares of Jiafeng Electronics?" Feng Zhiyao asked tentatively, observing Lu Feng through the rearview mirror.
"What are you dreaming about? Do you even know anything about financing? If I took 300 million and offered 5% of the original shares, wouldn't your dad kill me? Who would dare invest in me then?" Lu Feng said irritably, "What did you learn in school?"
“I’ll go back and discuss it with my dad. He told me he’d give me some money to invest, and I want to invest in you right now!” Feng Zhiyao chuckled and said, “Brother Feng, I think you’re pretty short of money. The company has a lot of holes to cover, and you still have 200 million to pay back in June.”
"Yes, and there's also two hundred million from the bank..."
"I'll take care of it for you!" Feng Zhiyao said hurriedly.
"I don't care at all. Do you think I'm short of two hundred million?" Lu Feng looked at him and said, "You really should learn more about the current policies in mainland China. Even if I don't pay back that two hundred million, who can do anything to me? Dare to bankrupt me? It's not me who's worried, it's the banks and the municipal government!"
"Huh?" Feng Zhiyao was also taken aback, not expecting Lu Feng to be so calm. He asked, "What if the bank seizes the collateral? The factory will be gone. If our property is seized, we will go bankrupt and be liquidated."
“If he dares to confiscate my property, I dare to stop production. You don’t understand. The industry in Hong Kong has already developed, and the place is too small. It’s not even the size of a palm, just the size of a fingernail. There are only a few districts, so there’s not much internal competition. The mainland is different. Look at those cities. Every city is full of officials, and everyone is scrambling to climb up the ranks.”
"You can't say that. They are all capable officials with goals to strive for. Remember this when making investments in the future: the more eloquent and talkative they are, the more you should invest in them, understand?" Lu Feng instructed.
"Shouldn't we be investing in companies that are practical and have a promising future?" Feng Zhiyao wondered.
"Your dad's best return on investment is letting you work with me. Let me teach you a trick: if an industry has a promising future, there may be a hundred companies in that industry, and only one of them will succeed. Are you sure you can be that accurate in your investments?"
"So you should invest in companies that can fool people. If you put in ten million, they can turn around and trick another person into investing thirty million. When it comes to the third round of investment, if you see the trend is not right, you can withdraw and you still make a profit. There is a saying in the investment world: the first person to rush in is a reckless person, and the second person to rush in is a fool." Lu Feng lectured, leaning back in the back seat.
"And the third one?"
"It's chives!"
Feng Zhiyao: ...........
Mr. Zheng's shell company is already in full production, and the goods have been piled up in the market. They are pushing the goods out through various distribution channels and wholesalers.
There are many manufacturers that produce in large quantities. For example, Mr. Zheng's factory is called "True Gold Leopard". In order to produce VCDs, Mr. Zheng has already squandered all of last year's profits.
If the market explodes, he'll make money from it. If everyone can't sell and Jiafeng Electronics goes bankrupt, he'll use funds from Changhong to acquire it. Only he could come up with such a clever way to hedge risks.
"Hey, Mr. Li!" Mr. Zheng leaned back in his chair, beaming with pride. "The market channels are almost fully established. Jinbao's sales have slowed down a lot these past few days. They can't get their goods to some places. Now it's time for us to make money."
"The market might become saturated in the next few days, but I think selling 10,000 units a day shouldn't be a problem," Mr. Li pondered. "Business is like playing mahjong; I can control my hand, but I can't let my opponent win!"
"I heard that Jiao Enfan wants to come back? This situation is not easy to handle."
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