2003: Starting with Foreign Trade

Chapter 187 Supply Chain System Concept

"Let me think about it. The investment is not a small amount, and I can't be as decisive as Lao Zhang," Zhang Mingcan replied after a moment of silence.

Tan Jincheng nodded: "Yes, we do need to be careful, but there's no rush, it's still early. I'll be going now."

Although neither party said it explicitly, they both understood the meaning behind it.

Zhang Mingcan watched as Tan Jincheng strode towards the Audi A6, his eyes flashing, and then he followed him.

"No need for that, we don't need to go through all that," Tan Jincheng said with a smile.

"I didn't mean to see you off; I just wanted to walk around a bit and clear my head," Zhang Mingcan said with a wry smile.

In just one year, this young man in front of me has gone from being a follower to someone I have to look up to; the change is so fast that it's hard to keep up.

"Actually, if you want to do it, you don't need to go through all that trouble. Just set up a new company and leave your current factory as it is."

Zhang Mingcan replied somewhat absentmindedly, "Hmm, I'll think about it."

Tan Jincheng glanced at him and saw that he didn't seem to understand what he meant, but he didn't say anything more. This matter really needed to be considered seriously. Unlike Zhang Haiping's expansion, buying land and building a factory would require more expensive injection molding equipment, and the required investment would be at least in the tens of millions.

Zhang Mingcan must have some connections, otherwise he wouldn't have been able to get 500 million so easily last time. But he probably doesn't have enough money, and he can't bring himself to buy the Audi A6 he's been wanting for so long.

An investment of tens of millions of yuan could be half a lifetime's savings. Such a large investment is not something he can decide on his own; he should at least go home and discuss it with his wife.

Companies like Mingcan Moulding are essentially large-scale family businesses. Zhang Mingcan is in charge of business and interpersonal relationships, while his wife manages the finances at the factory.

In fact, Tan Jincheng's idea was to establish a new company, acquire land in the industrial park to build a factory, and invest in equipment. FlashTech could then acquire a certain percentage of shares in the new company through equity participation.

Although exterior parts are not core technology and any plastic products company can develop them with some investment, this year's orders are in the tens of millions, and Tan Jincheng doesn't want them all to benefit others.

Changing to a new supplier is not impossible, but for a large company, the most important thing about the supply chain system is stability. You can't keep changing suppliers every one or two years; that would seem a bit short-sighted.

By partnering with buyers to establish a new company and holding a certain percentage of shares in it, buyers don't have to worry about their business suddenly disappearing or not getting paid, and you can feel more at ease. This is the best way to cooperate.

Just like the city investment company's investment in Flash Technology, cooperation is the only way to achieve mutual benefit.

But there's no point in talking to him about it now. Let's wait until he's thought it through before we talk about it. There's no rush anyway.

Based on next year's production capacity design, the existing injection molding workshops of Mingcan Moulding and Flashtech can basically handle the orders of more than 100 million to 300 million per month, so there is no need to worry too much.

The most important thing right now is the battery, especially the 48V battery. The Fengchi series uses 48V batteries, so we need to talk to Boneng Environmental Protection.

Because the previous production capacity of the deluxe version was only 20%, there is still a lot of inventory of 60V batteries. After the new factory goes into production, some of the inventory will need to be used up first. For a manufacturing company, it is essential to manage both the inventory of components and the inventory of finished products well.

As businesses grow larger, a large portion of their products become inventory. This inventory not only ties up a lot of capital but also requires significant human and material resources to manage. Often, a company can easily be dragged down by a large amount of inventory.

I remember in my past life, several companies in Apple's supply chain were dragged down by inventory. Electronic products are updated and iterated rapidly. If they can't be sold in one year, they will turn into inventory the following year, which is quite dangerous.

While electric scooters may not be quite that extreme, and the market is expanding rapidly, they still carry significant risks, such as battery upgrades and design changes.

Especially after the implementation of the new national standard, the electric scooter industry underwent a major transformation. If there was a large inventory before the implementation of the new national standard, it could have been a real problem.

Currently, the implementation standard for electric bicycles is still the General Technical Conditions for Electric Bicycles issued on October 1, 1999, which is what is now known as the old national standard. Only some parts of the whole vehicle are subject to mandatory standards.

In practice, no one cared, and the market was flooded with all sorts of electric scooters, many of which exceeded the standards. In the years before the new national standard was implemented, some electric scooters were almost like motorcycles, and young people rode them like crazy.

Like any industry, the development of electric scooters in their early stages was also characterized by rudimentary production methods, requiring only a few workers and a dilapidated factory to produce them.

After the new national standard was implemented in 2019, there were very few electric vehicles on the market that exceeded the standard. This marked the beginning of a turning point for the industry, with a large number of small factories closing down and the market officially entering the stage of brand operation.

The most representative example is that under the new national standard, every electric vehicle must pass 3C certification and be registered before it can be driven on the road. But now, none of this is necessary. You can buy a small electric scooter, find a place to learn for a couple of days, and then you can drive on the road.

After the new national standard was introduced in 2019, the "three major certificates" are indispensable. The increase in enterprise costs will inevitably make it impossible for some small workshops to continue operating. In addition, the lead-acid battery industry will be most affected.

Electric vehicles powered by lead-acid batteries are generally quite large and heavy. In order to meet the requirements of the new national standard, lithium batteries have to be considered. Lithium batteries are a key component for the range of electric vehicles because electric vehicles powered by lithium batteries are smaller and the batteries are lighter.

However, lithium batteries are also relatively expensive, so it's become difficult to find affordable electric vehicles on the market, especially in large cities. There are still 13 years until 2019, and 9 years until 2014, which is considered the beginning of the new energy vehicle era. Using these 9 years to research lithium battery technology should still be feasible.

Therefore, FlashTech is destined to abandon the lead-acid battery sector. There is no need to research an industry with insufficient future applications, just like abandoning the current PC-based internet.

Compared to most, Tan Jincheng, who possesses memories of his past life, and Flash Technology have an advantage in terms of the overall direction. What they currently lack is technological research and development; Flash Technology's technological strength is still too weak.

However, Tan Jincheng doesn't understand the technical aspects, which is currently his biggest concern.
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Changxin County, Boneng Environmental Protection.

When Tan Jincheng arrived, it was already past 2 p.m. Compared to the previous time when most people came, this time Tan Jincheng came alone, which made him seem a bit lonely.

The company did hire two drivers. One was responsible for picking up guests and drove the BMW 3 Series they had driven before. The other was for internal use and was responsible for the Passat and pickup truck that were transferred from Jinpeng Trading.

However, Tan Jincheng is not yet used to having a personal driver and usually drives himself when he goes out. This is partly because it is not yet suitable for his current status, and partly because of his personality.

Tan Jincheng prefers to drive himself rather than entrust his life to a driver who has only recently joined the company and whom he doesn't quite trust.

Although it's tiring, I feel at ease.

As the leaders have analyzed, Tan Jincheng's investments are like going all in, but he manages the company's cash flow very well, largely due to his personality.

Adventurous, yet composed.

"Welcome back, Mr. Tan. Why are you alone this time?"

Boneng General Manager Zhang Yunhua greeted them warmly, saying that he was personally receiving them this time and that his attitude was even more enthusiastic than the last time.

"I'm the only one who's not working in the company, so I'll take this job."

Tan Jincheng smiled as he accepted the bottled water handed to him by Zhang Yunhua's secretary, Ma Xiangfeng.

"President Tan has been doing incredibly well these past six months. Now, who in the electric scooter industry doesn't know FlashDrive?" Zhang Yunhua remarked.

Six months ago, Flash Electric Vehicles was virtually unknown. Through two celebrity endorsements, it quickly became a rising star in the market, partnered with the local government, and the construction of its industrial base became widely known within the industry.

All of this happened so fast it was unbelievable.

To be honest, the last time Tan Jincheng brought so many people to place an order, even though he was the client, Zhang Yunhua didn't think the company could go very far. He guessed that they were just trying to make a quick buck because the market was booming.

4 battery sets, while not a small order, are not a particularly large order in this year's electric scooter market. The contract is only for one year, so it's estimated that once they sell all the batteries, this customer will be gone.

However, Tan Jincheng's series of actions refreshed Zhang Yunhua's understanding of FlashCheer. This young man's ambition was no less than that of Chip-Japan and Yadi, who had stirred up trouble this year.

In particular, he has the support of the Beicang District government, so it's really hard to say where he will end up in the future.

It's clear that Tan Jincheng's visit this time represents the new FlashTech, and he wants to discuss further cooperation with the company. FlashTech is not what it used to be; if the boss hadn't been so hands-off, he wouldn't have had the chance to talk to him this time.

"Mr. Zhang is joking. We're just small fry. What else can we do besides taking some unorthodox marketing approaches?"

"Haha, Mr. Tan, this isn't exactly a crooked approach. Corporate marketing is absolutely necessary; even a good product needs advertising."

"By the way, I'm curious about something. Did they really spend 3500 million yuan to hire Liu Yifei as their spokesperson? That's too expensive! Are celebrities making money this easily these days?"

That's true, Moutai has done a lot of advertising.

"Yes, it really cost that much, but it's a long-term contract, so it's not too bad; Mr. Zhang, you don't know, when I signed the contract, I even thought about becoming a star. The money we earn in a year isn't even enough for an endorsement fee."

"Haha, I think it would be great if Mr. Tan became a star. You're quite handsome too."

Of course, Yicheng Baigu, that was his nickname back in high school.

After exchanging pleasantries for a while, Zhang Yunhua asked somewhat impatiently, "President Tan, are you here to discuss a new battery cooperation plan?"

How could we not be anxious? It's said that the 4 sets of Flash 48V are almost used up.

(End of this chapter)