2003: Starting with Foreign Trade

Chapter 148 The Future Expansion Path of Flashspeed

The operational strategy of modern enterprises can never be one of "good wine in a secluded alley," especially for a brand-new brand. Good advertising and marketing will greatly increase the probability of success and shorten the cycle.

"Boss, here's some data you requested."

"Put it on the table."

Manufacturing is tough; factory workers get no rest. Even though it's Saturday, Yu Lin, the marketing director, still has to come to the company to handle various matters.

The subordinate submitted some information that he had previously instructed to keep an eye on the recent activities of Flash, a dark horse in the industry. Last night, the Super Girl finals ended, and Flash's spokesperson won the championship.

By now, Yu Lin has a fairly comprehensive understanding of Flashcar. It is indeed an electric vehicle assembly factory founded by a young man with no background and no core technology, at least on the surface.

With increased understanding, the positioning has changed. In Yu Lin's view, Flash Auto is now playing the role of a disruptor in the industry, and whether it can continue to exist in the future is still unknown.

The owner started his business in international garment trade, so he must be quite capable. He probably saw the potential of electric scooters and rushed into this project. With his unique marketing methods and low prices, he caught people's attention.

Of course, his electric car's exterior design is quite advanced, which is something Xinri should learn from. It has to be said that people who have worked in the clothing trade have a good sense of aesthetics. What's most infuriating is that their design team leader was actually poached from their own side!

FlashRace's approximate production capacity is no secret. Anyone who goes to the Beicang warehouse in Ningbo will know that such a small production capacity cannot pose a threat to ChipRace. The reason why subordinates were asked to submit a report of concern is simply to see things through.

"It's a pity, their marketing plan was done by that young boss, so we definitely can't poach him." Yu Lin said with a wry smile, looking at the data in his hand.

Yu Lin himself works in marketing, and he is very familiar with Flash's offline marketing strategy. Combined with provincial and local TV stations and online advertising, this can be considered as gradually building up the product's brand awareness.

The small advertisement before the final last night can be considered the real explosion point of the promotion during that period. There are also reports on the Internet today that the Super Girl final last night attracted a total of 200 million viewers.

Showcasing his brand in front of 200 million people is undeniably a series of impressive moves; what's most amazing is that this young man was able to make a bold bet and sign an endorsement deal as soon as he entered the top ten – his foresight is simply unmatched.

There are rumors online that this young man is a fan of Li Yuchun and a member of the "Corns" group, which is why he signed with Li Yuchun without hesitation. Yu Lin does not believe this.

A business owner may have their own hobbies, or they may actually be a member of a fan group, but they would never invite a spokesperson for such a simple reason. Inviting a spokesperson must be in line with the company's image and have a promotional effect on the company and its products.

So far, his marketing plan seems to be excellent and successful. As for the controversy brought about by the contestant, it is not important at all compared to the popularity she gained from the top 10 to her final victory.

Staring at the pile of data in his hand, Yu Lin sighed, "It's a pity that I didn't discover such talent before I became a boss."

Yu Lin then put away the data and instructed his assistant, "Let's stop focusing on FlashDrive here. I'll let you know if there are any changes later."

"Okay, boss."

From a marketing perspective, FlashDrive's first-phase marketing peak has passed, and the next step should be to focus on shipping. Its production capacity poses no threat to ChipRi; the real headache should be for those off-brand products.

However, it's time for us to take action. Let's offer some discounts, and maybe we could hire a spokesperson?
"Hmm, this method is feasible. Let's submit a proposal to the boss and see."
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"How to handle it? Of course, we should go all out to produce. We should agree to the orders according to their grade, negotiate the delivery time, and for the additional 100 units ordered, we should follow the previous contract and increase the prepayment to 50% for the 100 units ordered."

Tan Jincheng, who had just returned from the station, sat leisurely in his office chair.

Tan Jincheng was in a good mood after receiving so much good news as soon as he returned to the company. It seemed that the advertisement last night was indeed effective. In the era when the Internet was not yet mainstream media, it was still necessary to maintain a good relationship with the TV station.

Zhang Xuhui was taken aback. Why did he have to pay more for buying more? Shouldn't there be some discount? "Won't raising the price by 50% cause dissatisfaction among retailers?"

"It's alright, just let Wu Zhenping make the arrangements. He'll understand. If Brother Hui doesn't understand, he can ask him," Tan Jincheng said with a smile.

The increase in prepayment is due to both risk considerations and the desire to prevent retailers from stocking up on too much inventory at once, which could lead to a de facto agency model and market monopoly in a particular region.

At present, Flash Motors is still mainly focused on market expansion. Based on 100 units per retailer, the increased production capacity will not only open up the Yicheng market, but also allow for the opening of many more stores in the existing areas to sell Flash Motors.

"Okay, I'll go arrange it. Is there anything else, boss?"

"Nothing for now, just call me if you need anything." "Oh, by the way, a studio apartment will be available next month. It's a bit further from the company dormitory, so if you don't mind the commute, you can move there."

Zhang Xuhui was taken aback for a moment, but quickly realized what he meant: "Okay."

How come there's suddenly an extra studio apartment? We'll have to ask Xu Peng about this to see what's going on; Zhang Xuhui is currently living in company-rented employee dormitories, but the benefits are much better than for ordinary employees. It's a two-person suite, and he's the only one living there right now.

Whether we move or not doesn't really matter; buying a small electric scooter is the most urgent thing.

Flash Auto is currently offering a discount for employees purchasing cars, covering employees of three companies including Jinpeng Trading and Jinyi Industry. The employee discount price for the luxury version is 2000 yuan, and the standard version is 1800 yuan. Each employee is limited to purchasing one car.

The deluxe version is 300 yuan cheaper than the market price, while the standard version is 200 yuan cheaper. Most of the employees who chose to buy it opted for the deluxe version, whether it was due to their pursuit of performance or the desire to get more discounts.

After Zhang Xuhui left, Tan Jincheng sat alone in his office, deep in thought.

The initial promotion has come to an end, and subsequent marketing will enter a period of consolidation. Television advertising will be reduced accordingly, while online marketing will focus on word-of-mouth.

As for expansion, this year's expansion has come to an end. The current factory area can only support such a large production capacity, and further expansion will require new factory buildings.

For the new factory, Flash is determined to acquire the land; it will no longer be able to expand through leasing.

In the commercial real estate sector, whether it's residential buildings or office buildings, Tan Jincheng has no ability to participate until he has built Flashpark into a company worth billions. No matter how tempting the opportunity may be, he can only watch from the sidelines.

However, industrial land is different; it's much cheaper, and many of the industrial land plots in Beicang will be completely redeveloped in the future! This is where things can be done.

Beicang District is not large in area, and it has only been a separate district for 11 years this year. The major development has probably started after 2000. Currently, there are still large areas of farmland and factories in the future urban area.

In the future, these factories will be relocated to Xiaogang, Chunxiao, or Shanggeda near Yinzhou District, to free up residential space and improve the environment in the city. The profits involved are self-evident.

In a past life, a certain boss moved his factory from what now appears to be a suburban location to an industrial zone near Yinzhou District. By doing so, he not only gained a larger factory area but also made tens of millions in profit from the price difference.

The factory of this boss is not very large, and the timeline is about 10 years behind the present. The price of industrial land is incomparable to that of 10 years from now. And next year, Flash Motors will have the standard to apply for industrial land.

Actually, he is already eligible. Relevant departments have already suggested that Tan Jincheng submit an application report to higher authorities. The approval time for industrial land is not that fast. For industrially developed areas like Beicang, it would be considered fast if the application is approved next year.

However, there's no rush right now. We need to wait until at least the end of September to see how the market feedback on FlashDrive is received, and for the funds to flow back in. Also, there's a lot of information to prepare.

Excluding the small portion sold to employees at discounted prices in July and August, the sales figures for the market terminals have already been released, totaling 1288 million yuan. Of this, 515.2 million yuan was prepaid, and the remaining 712.8 million yuan will be received by the end of this month.

Despite working themselves to the bone, the average monthly sales of just over 600 million yuan are not enough to cover the initial investment, marketing costs, and bank interest. In fact, although Flash Auto seems to be doing well, it is still operating at a loss.

If we're really talking about making money, we still have to look to companies like Jinpeng Trading and Jinyi Industry, which are export-oriented companies with light asset operations. With a gross profit margin of over 40% plus tax rebates, Jinpeng Trading can easily earn around two million yuan a month.

This illustrates the difficulties faced by businesses, highlighting the enormous human, material, and financial resources required, as well as the exceptionally complex nature of the various aspects involved.

Although Flash has managed to keep procurement costs below 1000 yuan, the gross profit margin is actually not high when marketing and labor costs are added, along with the low price. Currently, the gross profit margin of the budget version is less than 30%, while the luxury version is slightly higher under the same marketing conditions, but still does not exceed 30%.

But in reality, this is already a pretty good gross profit margin. I remember that after 2018, the gross profit margin of electric scooters had basically dropped to the range of 15% to 20%, and by 2023, the net profit of the top performers was less than 10%.

It's almost impossible to realize one's automotive dream by simply selling cars one by one. One should use memories from one's past life to find ways to profit from things like real estate, or make a fortune in the capital market after scaling up, in order to achieve rapid accumulation and have a chance to realize one's dream.

However, with future cost control and reduced marketing expenses, Flash's gross profit margin still has room for improvement, after all, this is the best era for electric scooters.

"Let's start by increasing the gross profit margin."

(End of this chapter)