Chapter 29 – Business negotiations (Lowering prices)
Wen Dongjun went back to the farm but Feng Yu stayed in Bing City. The company had just started and there is a lot of work for Feng Yu. He needs to make the final decisions on many matters, such as the company’s rules and regulations.
Before Feng Yu had come up with the rules, Li Shiqiang ran over to him with a telegram. The telegram is in Russian. It must be from Kirilenko.
Feng Yu was still thinking when they will have their first deal since they set up the company and Kirilenko’s telegram came in.
In the current era, there are not a lot of places where you can make an international call. Feng Yu can only go to the Post office to make his call to Kirilenko. The staff at the Post office thought that Feng Yu is joking when Feng Yu said that he wants to make an international call. Feng Yu is still a teenager and yet he wants to make an international call? When the staff wanted to chase Feng Yu out, Feng Yu threw two pieces of ten RMB notes on the counter, picked up the phone and dialed Kirilenko.
The staff checked the notes to see if they were real. The notes were indeed real. Before the staff could tell Feng Yu about the rates, Feng Yu had already started to speak in Russian.
The staff was shocked. This kid actually called Russia and can speak Russian so fluently!
While on the phone, Feng Yu wrote down a list of items on a piece of paper. The phone call lasted for five minutes. He had wanted to leave the Post office and let the staff keep the change, but the staff stopped him.
“Five RMB a minute. Your call is five minutes and 30 seconds. The total is 30 RMB!” The Post office staff said.
Feng Yu shuddered at the cost of long distance charges. It is too expensive. He then took out another 20 RMB. He needs to make a few more phone calls.
Once he finished his phone calls, he rode a bicycle back to the company. At the company, Feng Yu sat in the newly renovated office and let the others stand outside the company, pretending to be very busy.
In less than 10 minutes, there is someone standing outside the entrance asking loudly: “Is this Tai Hua Trading Company?”
“Yes. Who are you looking for?” One of Feng Yu’s staff asked.
“I am looking for your Manager Feng. I am sales representative Wang Hua, from Three Brothers canning factory.” Wang Hua replied.
“Oh, canning factory again. Today, you are the third canning factory representative. Ok. Go up the stairs and turn left. You can see the manager’s room. It is written on the door.” Feng Yu’s staff said.
Wang Hua thought to himself: “Two other sale representatives from canning factories had came? This means that they don’t really need canned food or had already bought canned food. How can I negotiate this deal?”
Wang Hua went upstairs and knocked the office door. He heard someone asking him to come in and he opened the door.
Seeing the person behind the desk, he understood why the voice is so familiar. This is the kid that helped the Russian guy buy things at the cooperative the other day. This kid is the manager? Isn’t him a bit too young to be a manager?
But Wang Hua had been a sales representative for a number of years and had traveled to many places. At some places, he had seen bosses that are younger than Feng Yu. Most likely, these people are rich second generations with strong family backgrounds. He wonders who is Feng Yu’s father. Could it be some government official’s son?
“Hello, Manager Feng. I am Wang Hua from Three Brothers Canning factory. We can produce the country’s best-selling canned fruit. We also took the Gold award last year at XX Province.” Wang Hua said.
Feng Yu smirked. Provincial awards are just local protectionism. It does not have any value. Not to mention, the award Wang Hua said, was later exposed to be organized and fixed by a few businessmen to give awards to themselves.
In Feng Yu’s previous life, this method had been used countless of times. But for now, having such awards still seems prestigious to many.
“Oh. Three Brother Canning factory? How did you know that we need a batch of canned fruit?” Feng Yu asked.
Wang Hua stopped for a moment and thought: “Didn’t you let someone call me? If you didn’t call me, who the hell made that call?”
Half an hour earlier, Wang Hua was in the hotel when he received a message from the hotel boss, saying Tai Hua trading company is buying canned fruits. The one who had left this message even left the company’s address.
For Wang Hua, it doesn’t matter who is the one who left the message as long as he is able to sell his canned fruits.
“A friend told me.” Wang Hua replied.
“Really? You must have a lot of friends but we had just spoken to two other canning factories. The prices they offered is quite attractive. We are already preparing the contracts. You are late. We hope to work with you in future.” Feng Yu said while holding his empty teacup, indicating to Wang Hua that he does not want to negotiate any business with him.
Wang Hua anxiously said: “Mr. Feng, our canned fruits taste particularly good and we have ready stocks in Bing City. Our warehouse is not far from yours. You can go over and take a look yourself. Furthermore, our prices are also cheap and selling well in the market.”
Wang Hua is anxious. He even used honorifics on Feng Yu.
“Is it? But the other two factories also have ready stocks and besides, I had already promised them and their prices are really cheap.” Feng Yu replied and mentioned the word “cheap” again.
“Ours is cheaper. Only 3 RMB for a can.” Wang Hua replied.
“3 RMB? It is too expensive. The other two factories are offering around 2 RMB.” Feng Yu said. Although he does not know the exact cost price of canned fruits, he knows that it will not exceed 2 RMB. If not, canned fruits will be selling for 4 to 5 RMB in stores.
“Our can have more weight. Ours is about 1 KG per can while theirs are only around 600 grams.” Wang Hua said.
“Come on, it’s all the syrup and water. The fruits in there are about the same. OK. We will get in touch with you next time.” Feng Yu interrupted Wang Hua.
“Mr. Feng, we can be a little cheaper. 2.6 RMB for a can. This is the cheapest we can go. Any cheaper, it will be at cost price.” Wang Hua had seen the number of goods Feng Yu bought when Feng Yu helped Kirilenko buy things. If Wang Hua is able to clinch this deal, he will achieve his quarterly target.
“I will buy some if it is 2.2 RMB.” Feng Yu said.
“2.2 RMB is really not possible. The lowest I can go is 2.4 RMB. We didn’t even offer such low prices to the cooperatives. I also promise you that these goods will be fresh and are canned within the month.” Wang Hua said.
This era, there are not much additives and preservatives in canned foods. As such, canned food had a shorter shelf life. Many dishonest businessmen changed the expiry dates on the packaging and export to other countries. To them, this is only a one-time business and they don’t care.
Feng Yu frowned and said: “2.4 RMB. How many stocks do you have in your warehouse?”
“500!” Wang Hua replied loudly.
Feng Yu shook his head: “That’s not enough.”
Wang Hua happily said: “I can ship more from the factory. Only takes three days to arrive. How much more do you want? Even 1,000 cans also no problem.”
“Then send another 500 cans over. I want peach, hawthorn and assorted fruits. I will make the payments two days after the goods are loaded. Any problems?” Feng Yu asked.
“No problem, absolutely no problem! I will contact our director. Mr. Feng, shall we sign the contract first?” Wang Hua asked.
Wang Hua took out a contract with the company’s stamp from his bag. The quantity, unit price, type and amount are blank and Wang Hua filled up this information in front of Feng Yu.
Feng Yu looked at the contract carefully. There are very few provisions in the contract but they were very clear and precise. It states the responsibility of both parties and the penalties for breaking the contract. Any party which default, will have to compensate the other party double the amount. Feng Yu smiled and took out the company’s stamp from the drawer. He stamped on the contract and sign “Feng Xingtai” on the contract. If the other party try to be funny, Feng Yu can just disregard this contract!
“OK. Go and prepare. The latest is five days and I will need to load the shipment. If the sales are good, I will look for you again next month.” Feng Yu said.
“Thank you, Manager Feng. I am staying at Jia Xing Hotel, room 201. This is the number to the hotel. You can contact me anytime.” Wang Hua said.
After Wang Hua left, Feng Yu smiled. He remembered that this canned fruits cost 2.9 RMB at the cooperative. Now it becomes 2.4 RMB. That Manager Su really earned a lot last time. But now Manager Su can no longer make any money from him.
