2003: Starting with Foreign Trade

Chapter 196 Cooperation with Mingcan Moulding
"These buildings are nice; the apartment layouts and discounted prices are quite suitable. Let's go with what he said and have him come here to sign the contract sometime."

"Okay, I understand. I'll contact them."

"Okay, contact the legal department, arrange a time, make sure to pay attention to the contract, and I'll leave the renovation and furniture arrangements to you. Can you handle it?"

"I'll do my best. If there's anything I don't understand, I can ask Uncle Zhang or Brother Sun."

"While you're at it, also finalize the lease agreement with Flashpoint Technology. Let's sign a 10-year lease for now, and the rent will be 20% lower than the market price."

"Ok, I see."

"Alright then, go ahead."

In 2005, the residential buildings in Beicang District were mainly low-rise buildings, and most communities limited the number of floors to six in order to avoid the need to install elevators.

Most of the residential buildings near Beicang Middle School are around six stories high, but there are also some low-rise buildings with elevators.

Low-rise residential buildings are often located in relatively remote areas. In contrast, most residential buildings in the main urban area and near schools are six stories high. For example, the Golden Coast community where Tan Jincheng lived was a six-story building without an elevator.

This time, Tan Jincheng chose two 11-story low-rise residential buildings, purchasing them as a whole. Each building has 44 units, with various unit sizes. The developer offered good discounts, including price reductions and additional parking spaces.

The total price is 26 million yuan, with a 40% down payment of 10.4 million yuan and a 20-year loan. There are also some preferential loan interest rates. The two buildings are side by side and will be used as staff dormitories, which is quite convenient.

It's 3000 million yuan less than the originally expected 400 million yuan. That 400 million yuan could have bought a luxury villa.

In addition, we should also make arrangements to buy a house near Ningbo University, which we planned to do last time. After Qingqing becomes a junior, it is actually possible for her to move out of the dormitory. She will be busier with work and study, and sometimes she will not be able to go back at night. Having a house outside will be much more convenient.

After Zhang Xuhui left, Tan Jincheng was in a daze and couldn't help but call Zhang Xupeng: "Old Zhang, what are you doing?"

"I'm playing games at the company, want to play together? Or if you're free, you can come over and sit for a while."

"Oh, playing games? What games?"

"The online game, Fantasy Westward Journey, is really fun. Why don't you create an account and we can play together? I've already played it for several nights in a row."

"No, no, I don't have that much free time. Besides, I have someone to keep me company at night. You're different; you're single, so all you can do is play games."

"Idiot, hurry up and tell me what's wrong, I still have a mission to do."

"It's nothing, I just heard from Brother Xuhui that you knew I bought two buildings. How did you find out?"

Zhang Xupeng was taken aback, his hand hovering over the mouse. "What? I don't know. Wait, two buildings? Not two apartments?"

He really didn't know about this. Ever since the shares were redistributed, Zhang Xupeng hadn't been coming to FlashTech much, and with his recent obsession with games, he had even less time.

The two had previously discussed buying a villa together, and even decided to buy one in the same neighborhood, but nothing has been finalized yet.

How come there are two more buildings now?

"Yeah, two 11-story buildings, a total of 88 units, 2600 million yuan, not bad, right? But I prefer odd numbers; hey, you know, last year when we bought our old small apartment together, we were so excited following the sales figures, looking at different floor plans for days, we were so thrilled back then, how come now that we've bought two buildings, we don't feel that same way anymore?"

"Damn it, now I understand why you called. You're just showing off to me again," Zhang Xupeng said speechlessly.

"No, no, am I such a materialistic person? I'm just lamenting that I don't have that same feeling when I spend money anymore, you understand?"

"What the hell do I understand? I can't afford two buildings. Besides, why are you buying so many houses?"

"We rent them out to companies as employee dormitories. Look, my company already has five or six hundred employees, and we'll have even more in the future. These two buildings aren't enough."

"Alright, alright, I really understand now. You're just here to show off, but I don't want to hear it. I'm hanging up."

After saying that, Zhang Xupeng hung up the phone.

After hanging up the phone, Zhang Xupeng stared blankly at the computer screen for a while, then laughed after a moment of contemplation, before immersing himself back into his gaming spree. On the other end of the line, Tan Jincheng, holding his now-ended phone, muttered to himself, "He wasn't just showing off."

When I bought that small apartment in Liren Garden last year, although I didn't feel the same excitement as when I bought my first house in my previous life, I was still excited for several days. After all, it was my first fixed asset in Beicang in this life, and it belonged entirely to me.

Even the house back in my hometown makes me feel more excited than I do now.

Perhaps because these two houses weren't for his own residence, Tan Jincheng didn't even bother to visit the sites, considering only the location, discounts, and quality assessments. He left everything to Zhang Xuhui, so he wasn't particularly excited about them.

Both buildings are registered under a private name. In over a decade, both buildings will be in excellent locations and could easily fetch over 200 million yuan. This is a sure-fire investment, but it is just an investment.

As for the future increase in the number of employees and the shortage of dormitories, Flash Technology will definitely use that time to acquire land and build its own employee dormitories, just like Shenzhou Company. Flash Technology will also have its own real estate development company at that time.

Whether it's the manufacturing industry or the internet industry, it's impossible to avoid real estate. Tan Jincheng is no saint either. The "six wallets" policy has indeed affected many people's lives, but that doesn't mean you won't develop to this stage if you do it.

When a physical company develops to a certain stage, with thousands or even tens of thousands of employees, formal management and solving the accommodation problem for most employees are inevitable issues that will not change due to the boss's will.

This is a necessity and an inevitability in the course of development. From another perspective, it is also a good thing. With the company introducing more preferential housing policies, employees save on housing costs and have more money in their pockets.

Having more money leads to spending and purchasing various goods, which is also a way to boost the local economy.

The premise is that housing prices rise in a healthy way.

In the current era, apart from certain areas in Shanghai, Beijing, and Shenzhen, housing prices across the country are actually quite healthy. Taking Beicang District as an example, the highest prices are only around 4000 yuan per square meter, while the lowest are just over 2000 yuan per square meter, with the average price being only around 3000 yuan per square meter.

Beicang District is full of factories, offering many job opportunities. The average wage level is not that low. Take the mold industry, which is relatively developed and still very popular in Beicang District, for example. Apart from the slightly higher entry threshold, the wages are not low at all.

Taking Mingcan Moulding as an example, in 2005, mold makers who were in charge of mold making could earn 10,000 yuan or even more per month, depending on their skill level. The basic salary of CNC programming masters was generally above 3500 yuan, while the basic salary of mold design masters was generally above 5000 yuan.

With such a salary, buying a house is entirely affordable. A month's salary is roughly equivalent to the local average house price, which is a healthy level and is unlikely to affect the quality of life.

With average wages of five or six thousand yuan and housing prices of thirty to fifty thousand yuan, who can afford to buy a house?
"Everything needs to maintain a virtuous cycle," Tan Jincheng sighed inwardly, standing up as he spoke.

Let's do something else that creates a positive cycle, which is to collaborate with Zhang Mingcan.

Since Tan Jincheng hinted to Zhang Mingcan about the idea of ​​starting a company together on the way to Hengdian, Zhang Mingcan has given it serious consideration and discussed it with his wife for several days after returning home.

The investment in the new factory will definitely be in the tens of millions. If it is solely owned by the company, it is indeed possible to secure a large order from Flash Technology, and the profits will be quite substantial. However, the risks are also very high.

A company that bets everything on a single customer will suffer unpredictable losses if the customer's orders change, a new supplier is introduced, or the customer's order is snatched away by someone else.

Tan Jincheng had previously revealed to him that the production capacity of FlashTech's electric scooter was expected to be over 20 units in 2006, and could reach up to 50 units.

The supply price of plastic parts is 68 yuan per set. Based on this, the annual order amount will be between 1300 million and 3400 million yuan. With the construction of the new industrial base in 2007, the order amount will increase further.

The gross profit margin of plastic parts cannot be compared with that of molds, but the volume is huge. Considering the investment of tens of millions of yuan to build a factory, if all the orders are secured, it will take about four years to break even, taking into account the price reduction factor.

To be honest, this business is actually quite profitable. With a stable base of orders and the addition of new clients, the return on investment will be much faster. Imagine how great it would be to own a factory that is completely your own in three or four years.

However, Zhang Mingcan also knew that if he owned the company alone, he would indeed have the final say, but at the same time, he would have no say in the orders from Flash Technology.

A 20-year-old is at a time when his thoughts are constantly changing, especially an outstanding young man like Tan Jincheng. You simply can't grasp his mind. Friends are important in business, but what's even more important is, and will only be, interests.

Therefore, he accepted Tan Jincheng's suggestion to cooperate with him and jointly establish a new company. He would manage the new company, and Flash Technology would participate by investing in the company. This was the best way to protect his own interests.

As for newly developed customers in the future, FlashTech will take a share of the profits, and there's nothing we can do about that.

For Mingcan Moulding, the nationwide ban on motorcycles has made the transformation from motorcycle parts a necessity. Otherwise, the factory will only shrink. And a major customer like FlashTech in the electric vehicle industry is one that Mingcan Moulding must firmly grasp.

(End of this chapter)