Chapter 111 - Investments
Chapter 111: Investments
Translator:Nyoi-Bo Studio
Editor:Nyoi-Bo Studio
Ling Jun Dong asked in a tone of dissolution, "Why, Chief Chen? Is there something that you are still worried about?"
The crowd looked towards Chen Jin, waiting for his explanation.
"It's not worries, it's about money, the foreigners won't let us profit easily!" Chen Jin shook his head and said, "All of you are aware of the ChinaSat incident last year, right? The 5G services provided by Hua Yao is restrained by many countries; Drones by Da Jiang is banned by M nation's national military... the high-tech companies from Z nation are frequently under immense pressure and restrictions. We hope for a win-win situation, what about them? They are just playing the zero-sum game! Even if it's just regular trades, they feel that they are at a great disadvantage, entirely overlooking the fact that our low-priced goods are what's immensely reducing their cost of living."
Chen Jin huffed. "Xing Hai Technologies will become a tech giant in the future. It is destined to impose a substantial amount of threat towards the western world, and thus pressure and restrictions will be inevitable. Why? Simply because we are stronger and better than them! They're flustered, jealous, afraid, so they will opt to do dirty things and cause us trouble… this kind of hysterical behavior is written in their genes. Instead of idly waiting for our impending catastrophes, why not we just forsake that market? Why do we need to trade our pride and bow our heads down to them just for the sake of money!"
Flustered, Li Yuan Liang said, "But chief, that market is worth hundreds of billions, is it really worth our ego? The western governments have yet to pressure us, besides, there are some countries in South-East Asia, Northern Europe, India, South Asia, wealthy nations in the middle east, South America, and others that we can still do business with. Every bit counts, chief."
"He has a point, chief, globalization is essential for the growth of the company, it is well worth the risk."
Everyone tried to sway Chen Jin, as they felt that the way he thought was too extreme in this matter. Indeed, doing business could be hard in certain countries, but there were over 180 countries on Earth; forsaking a whole continent just for a few troublesome ones wass not worth it. That was not a smart move.
"What's the hurry, I didn't say I don't want their money." Chen Jin frowned. "Mr. Lei from Da Mi Technologies called yesterday. He said he wanted to push Ai Mi sweeping robots overseas and asked me for its copyright, and I agreed; from now on, for each unit of Ai Mi sweeping robots sold at foreign markets, Da Mi must pay us $25 as a patent fee. If Ai Mi sweeping robots succeed in foreign markets, we will certainly benefit from it."
In fact, Lei Xiao Jun had no other choice on this matter. Last month, his Ai Mi robot was released to the market with a fixed price of $3,699. The robot was expected to replace Wa-wah: Model No. 1 after its production halt and dominate the low-end market. To their dismay, the Ai Mi robot only got a mediocre response from the market, with sales not exceeding 500 thousand units. The product was then haunted by quality issues. Followed by an outpour of negative feedback comments, its sales further plummeted.
The main issue was that compared to Wa-wah Robot 1.1, the Ai Mi robot was inferior, even in terms of material and durability. Besides, the post-sale services of the Wa-wah robot were very complete, even providing free repair service for more than three years!
The Ai Mi robot only provided six months of free service. In terms of price, there was only a $300 difference between the Ai Mi robot and the basic version of Wa-wah robot 1.1. In this consumer era, people knew how to compare products and make the better choice. Unable to compete in local markets, Lei Xiao Jun could only put his hopes in foreign markets. After all, sweeping robots were still new abroad. The Ai Mi robot still had a chance over there. Therefore, he called Chen Jin, asking for authorization to sell the Ai Mi robot overseas.
Naturally, Chen Jin complied. Just recently Youying Motor and Da Mi robots signed a stock supply deal where they would be supplying Ai Mi robots locally-made brushless motors. The prospective amount of orders was three million units, where each unit was $40 with the addition of $10 on patent fees. Thus, with each unit of Ai Mi robots sold overseas, Chen Jin would make a profit of over $40.
Recently, too, there came favorable news from Bi Long Company. Wang Quan Long stated that the first batch of gear prototypes that passed quality check had completed offline production and was scheduled for mass production commencing next month. By that time, by selling the components to Da Mi (which would directly rip a hole in Fanuc Corporation's business), Chen Jin would profit an additional $15 for each unit sold.
If the Ai Mi robot were to have excellent sales overseas, Chen Jin would gain a significant amount of profit. Besides, the profit he would be gaining did not require him to put forth any effort. There was no reason to say no to easy money.
"Alright chief. The amount might not look as great, but it does indeed save us a lot of trouble. But… can our vision to become a giant be accomplished by doing business only within our country?" Ling Dong Jun shook his head quietly. He received western education and worked at foreign companies for two years. He learned many things via his experience and thus believed that there were many good business models out there that local companies should learn from. He thought that local companies should deal with them more to heighten their views to a global perspective. Despite some governments possibly being hard to deal with, it was still better than staying idle and in self-isolation.
However, Chen Jin had no interest nor any intentions to step foot in a foreign land and become a multinational company. He opted to keep Xin Hai Technologies services for locals and locals only! The main objective of his company was to help the locals, he did not care about how much he could profit from the foreigners.
The money he could mine from the local market was already limitless, why even bother expanding overseas?
The upper management crowd remained silent.
...
On July fifth, after three months, Shi Xiaotao returned to Shang Hai to meet Chen Jin. This time, however, what she brought along was not a script, but a demo version of the opening of an anime movie called "Wa-wah robots: Zhi Yong's Great Rescue." The movie was based on a modified version of the previous script and was produced by a group of professionals. She then presented it to Chen Jin.
"You completed the demo in such a short time?" Chen Jin asked, surprised by her astounding efficiency.
Shi Xiaotao flipped her hair, waved her double ponytail to her back, crossed her hands and said with a face of great satisfaction, "I spent quite some fortune to hire the most experienced animation production team, adding on the materials you provided, of course the production would be fast, besides…" She walked to Chen Jin, double clicked the folder on his computer, and played the demo video. "Personally, I think three minutes is too short. I made a 15-minute one, you can have a look."
"15 minutes?" Chen Jin was left jaw dropped. "Isn't that too fast?" He shook his head. "Don't celebrate too early, if the quality is mediocre or less, I'll make you redo it, and you will lose even more."
"Have a look first, I wouldn't bring it to you in the first place if it was bad." Shi Xiaotao, who was talented in arts, was confident in the quality of the work she had done.
Chen Jin looked at it seriously. Even without dubbing, the visuals in the demo were definitely on par with high-quality anime! The plot, camera movements, and the flow of the rhythm were all beyond satisfactory levels and allowed him, as the audience, to completely indulge in the movie. "Not bad, not bad at all, the quality is on point, the visuals are exquisite. An excellent director indeed." Chen Jin gave a big thumbs up to Shi Xiaotao, finally acknowledging her capabilities.
"That is for certain, I have already told you, I will become the best director in the local scene. Why? Because I am capable!" she said with pride.
They talked about some other issues regarding the movie, for example, production cost, sequels, advertising, and so on. What Chen Jin was most concerned about was when the movie could hit the big screens.
Shi Xiatao said, "The movie is around a hundred minutes. Accounting for the remaining production, dubbing, and advertising, it can be released around June next year, which is about one year from now."
"1 year? Can you hasten the production? Is it possible to bring it forward to February and release it during the lunar new year?"
"It is possible, but for that to happen we have to increase our manpower and put more into production efforts. Money is what I am worried about." Shi Xiaotao felt somewhat conflicted. She, too, wanted to finish the movie before the lunar new year, but it didn't seem realistic.
"Are you short in cash? How much are you lacking?" Chen Jin asked.
"We are not short on money, my father gave me 50 million, and we have another 50 million from investors. The production cost is estimated to be around 250 million. My parents should be able to get the rest of the 150 million, just not immediately; in a few months' time at least. If we do not manage to raise the funds, we can use my house as mortgage… anyways, we are not lacking money."
"In this case, why don't I invest 100 million in this movie, you hasten the production, and complete it before the lunar new year? Is that doable?" Chen Jin asked. At the end of the year, Wa-wah 2.0 would be released; advertising through this movie that was worth a whopping 200 million would definitely be more effective than putting 10 million solely in regular advertising methods! Moreover, with Chen Jin investing 100 billion, he got a portion of the profits from ticket sales. Adding on the IP patent fees, he would gain a substantial amount of profit after the movie was released. No matter what, Chen Jin's investment in this movie was bound to win the roulette. It was hitting two birds with one stone.
"I'll do with that, I can save the trouble finding investors. I'll recruit another batch of people and the movie is certain to be done before the new year!" With glittering eyes, she accepted his investments.
They settled on their agreement; after the movie was released, Hai Xin Technologies would be entitled to 50% of the total profits from the movie courtesy of the IP patent fees along with the 15-million-dollar investment.
After signing the agreement, Shi Xiaotao muttered, "After all this trouble, I just realized that I am still a worker."
Chen Jin laughed.