Starting with vegetable greenhouses in 1988

Chapter 160 Product Selection
Jianguomenwai Street, west of the Diplomatic Residences.

Li Zhe stopped his bicycle in front of a shop on the ground floor, which had a sign that read "Diplomatic Residence Living Service Department".

Li Zhe locked his bicycle and went into the store. The store wasn't large, about 100 square meters. It had a wide variety of goods, including imported tobacco and alcohol, handicrafts, and small appliances, but fresh produce made up a relatively small portion, and most of the items were imported from abroad.

This is a community-based "Friendship Store," which is also commonly referred to as a "special supply point."

A female server in a white uniform asked, "Comrade, what do you need?"

"Give me a pack of Zhonghua cigarettes."

"65 foreign exchange certificates."

After paying, Li Zhe left the store and rode his bicycle to his own shop. Buying cigarettes was just a side trip; his main purpose was to "gather intelligence."

After reading it, Li Zhe felt more confident.

Li Zhe wants to transform his 365 Vegetable Store into a supermarket specializing in off-season vegetables, selling not only vegetables but also some vegetable-related products.

He was worried about competition with this "special supply point," but after visiting the store, he found that it also had a fresh produce section, mainly featuring imported products, which was its advantage. However, the two stores had different positioning, so the competition was minimal.

Li Zhe rode his bicycle to his shop and saw Sun Tao directing the workers to hang up the sign: "A little to the left, a little higher, yes, yes... hang it like that."

Sun Tao's eyes were fixed on the shop sign. He didn't notice Li Zhe at first, but after taking a few steps back, he caught sight of Li Zhe out of the corner of his eye. "Brother Li, do you think this location is alright?"

Li Zhe stared at the white sign on the green space, which read "365" in the middle and "Vegetable Shop" in both Chinese and English on the right. "Hmm, that's good. Let's hang it up."

After hanging up the sign, Li Zhe paid the remaining balance, and the two workers left with their tools.

"Brother Li, when are we opening?" Sun Tao asked with a hint of excitement.

Li Zhe smiled and asked in return, "What, you can't wait any longer?"

Sun Tao said, "That's right, our shop is almost ready. We just need to put the dishes on display and we can start selling."

Li Zhe handed Sun Tao a pack of Zhonghua cigarettes.

Sun Tao's eyes lit up, and he laughed, "Hey, this cigarette is good." He quickly opened the cigarette box, handed one to Li Zhe, lit it for him, and then lit one for himself.

Li Zhe looked at the shop's signboard and said, "I thought about it carefully again yesterday. Having only vegetables, fruits, and meat isn't enough. We need to add a general merchandise section."

Li Zhe had no experience running a vegetable store, so he could only accumulate experience gradually. "This is how I see it: our store mainly sells off-season vegetables and fruits. People come to buy vegetables to cook, and they'll also buy meat on the side. Cooking also requires some auxiliary ingredients, such as eggs, oil, salt, flour, seasonings, and canned goods..."

He walked into the store and said, "Put three rows of vertical double-sided shelves at the front, for vegetables, fruits, and meats respectively, and then put horizontal shelves for miscellaneous items against the wall inside. What do you think?"

Sun Tao took two puffs of his cigarette and replied, "I think it's fine."

Li Zhe laughed and said, "Don't try to fool me, kid. Your bonus will be tied to the business of the store in the future."

“Brother Li, I’m telling the truth. I was thinking of setting up a prepared food section before, but now that I think about it, a general merchandise section would be better. It has a longer shelf life, a wider variety of products, and we can also sell canned and other prepared foods.”

"Come on, let's go inside and discuss it further." The two entered the shop, which was heated, but it was still a bit cold because it was a commercial establishment.

Li Zhe took out a pen and notebook and began to compile statistics: four main categories—vegetables, fruits, meats, and groceries.

Based on the source of the products, they can be divided into four types: self-produced, ordinary goods, scarce goods, and imported goods.

Self-produced goods are easy to understand; they are the off-season fruits and vegetables grown by Li Zhe, which are also the store's main products.

Ordinary goods are those that can be bought in the market, such as potatoes, radishes, apples, and pears. Selling these ordinary goods to foreigners yields a much higher profit margin than selling them to ordinary people.

For in-demand commodities, such as citrus fruits, Beijing does not produce citrus fruits in winter, so they can only be transported from the south. We need to find ways to source them.

Imported goods, such as steak, can only be sourced from imports, especially high-quality steaks. Furthermore, foreigners love steak, and to a certain extent, the quality of the steak influences their opinion of a restaurant.

Li Zhe also positioned imported steaks as the second most popular product after off-season vegetables, saying that a smaller quantity was fine, as long as it was available. Sourcing these types of goods is the most challenging aspect.

Li Zhe doesn't need to worry about the self-produced goods, but he needs to find the channels and select the products for the other three types of goods himself.

Li Zhe listed the required items. Sun Tao added to the list.

Finally, the two rode their bicycles to Chongwenmen Market. By the time they arrived, it was nearly noon. They ate mutton soup and flatbread at Lao Wei's Mutton Soup Restaurant.

Around 1 p.m., I went to the Chongwenmen Farmers Market Management Office.

Li Zhe knocked on the door of the director's office.

"Come in," Director Han's voice rang out from inside the office. Li Zhe and Sun Tao pushed open the door and entered. Li Zhe smiled and said, "Director Han, I'm here to report on the progress of our work."

"Yes, Xiao Li and Xiao Sun are here." Director Han stood up, walked out from behind his desk, and gestured for them to sit down. "What would you like to drink?"

Sun Tao said, "Aunt Han, don't bother, we drank some water before we came."

"Alright, then I won't stand on ceremony with you." She sat down on the sofa and asked Li Zhe, who was sitting next to her, "Mr. Li, what brings you here today?"

Li Zhe briefly explained the vegetable shop's plans, then got straight to the point: "I'm here today to place an order." He handed over a list of goods, explaining, "These are the items our shop plans to sell. I wonder if the Chongwenmen Vegetable Market can supply them?" The Chongwenmen Vegetable Market is a comprehensive market that sells not only fruits and vegetables but also meat, groceries, and other general merchandise. You can basically find any food item there.

Director Han took the list of goods and looked at it: "Wow, your little shop sells quite a wide variety. Most of the items here can be found in our market. But don't even think about imported steaks. They're in very limited supply and have already been snapped up. We can't get any."

Li Zhe pressed further, "Can you supply in-demand commodities like citrus fruits?"

Director Han replied, "I can help you coordinate, but the price won't be cheap."

"As long as the quality of the goods can be guaranteed, a slightly higher price is fine." Because the store carries a variety of goods, Li Zhe also hopes to find a stable supply channel. With the Chongwenmen vegetable market as a reliable source of supply, he can save himself a lot of trouble. "Director Han, could you take us to see the products? Foreigners are quite picky, and I'd like to inspect them myself first."

Director Han glanced at the wall clock, stood up and said, "Come on, I'm not busy this afternoon, I'll show you around."

"Director Han, thank you for your help." With Director Han's involvement, efficiency will be greatly improved.

Of course, there's no such thing as a free lunch. In order to obtain the special operating license, Li Zhe had to pay the management office 300 foreign exchange certificates every month, which amounted to 3,600 a year.

Although it wasn't a particularly large amount, it was enough to buy a batch of in-demand New Year's goods and distribute some benefits to the staff at the vegetable market. Who wouldn't appreciate Director Han's kindness?

Director Han led Li Zhe to the warehouse of the vegetable market. It was filled with a vast quantity of goods, all kinds of them. Li Zhe was overwhelmed by the sheer variety and suggested, "Director Han, let's start with the fruit."

"The fruit is over here." Director Han was very familiar with the warehouse, pointing to the right, "This whole area is the fruit section, and over there are apples."

Director Han lifted a quilt and took out a bright red apple: "This is a Fuji apple from the outskirts of Beijing. It's big and has a crisp, sweet taste. We even went to their production area last year." Director Han took a few steps forward and lifted a quilt from another basket. "It's also a Guoguang apple from the outskirts of Beijing. It's medium-sized. When it's fresh off the harvest, it's a bit sour, but after being stored for a while, it becomes a perfect balance of sweet and sour, suitable for people who prefer a sweet and sour taste."

Director Han quickened his pace, looked at the sign on the basket, and lifted the cotton quilt on top: "These are crabapples, the smallest and cheapest. I reckon you probably won't like them."

Li Zhe asked, "What are the prices of Red Fuji and Guoguang apples?"

Director Han said, "Guoguang apples sell for 70 cents a pound to outsiders, but I'll give you a discount of 60 cents a pound; Red Fuji apples sell for 1.1 yuan a pound, but I'll give you a discount of 1 yuan a pound. How about that? Of course, I'm talking about today's prices. Prices may go up a bit by the end of the year."

Li Zhe walked to the basket of Fuji apples, examined the fruit inside, and frowned, saying, "Director Han, the quality of these Fuji apples is just average. They're all bruised and battered; there aren't many that are perfectly intact. These foreigners are always picky; I'm afraid they won't like them."

"This batch of apples was purchased by the food processing plant as a unit benefit. They are second-grade apples, so the appearance is a little worse, but the taste is not bad. It's a good deal," Director Han said in a low voice. "Don't worry, do you think we'll let the foreigners look down on them? We'll supply you with first-grade apples later."

Sun Tao chimed in from the side, "Aunt Han, I remember you have premium-grade fruit, don't you?"

Director Han glared at him: "You brat, you're siding with outsiders..." Seeing Li Zhe also staring at her, Director Han cleared her throat and said in a low voice: "Top-grade fruit is scarce; it's usually a perk for key units..."

Li Zhe asked curiously, "Director Han, may I see the quality of the premium-grade fruit?"

Director Han glanced around and led the two to an area on the left, where a rope was strung up with a small sign that read: "Premium Grade Fruit".

Director Han lifted the quilt, revealing a cardboard box filled with apples. She opened the box; each apple was wrapped in yellow paper. She randomly picked one and handed it to Li Zhe: "Here, this is premium grade."

"Wow, it's so big and round, and the color is so beautiful!" Li Zhe liked it as soon as he saw it.

Sun Tao took out a fruit knife from his pocket, wiped it with the paper that wrapped the apple, and handed it to Li Zhe: "Brother Li, try it and see how it tastes."

Li Zhe cut the apple open with a knife, and juice oozed from the skin. He first handed a piece to Director Han, then cut a piece for himself, and gave the rest of the apple to Sun Tao.

Li Zhe took a bite; it was crisp, sweet, and juicy: "Delicious."

Sun Tao nodded repeatedly: "Hey, this apple is really crisp and fresh. It's the first time I've ever eaten one like this."

Li Zhe smiled and said, "Director Han, could you also supply our store with premium-grade fruit? We can't lose face in front of foreigners, don't you think?" Seeing that Director Han didn't respond, he continued, "I can pay more."

Even apples of the same variety can vary greatly in appearance, resulting in different prices. It's like people; some are beautiful, some are not, some are tall, and some are short. Premium grade apples are large, well-shaped, have a uniform and bright color, and are undamaged. Only apples like these can command a high price!
Director Han pondered for a moment, and considering the three hundred yuan in foreign exchange certificates per month, he replied, "Alright, I'll supply you with top-grade fruit, but the price can't be one yuan; it has to be one yuan and twenty cents."

Li Zhe exclaimed in surprise, "Wow, such a big difference!"

Director Han said with a smile, "If you're not happy, then I'll give you first-grade fruit, and I'll still charge you one yuan per pound."

"No problem, I'm happy to." Li Zhe thought to himself, the wool comes from the sheep's back. These top-grade fruits are big and round. Selling them to foreigners for a little over 50 cents a pound with foreign exchange certificates isn't expensive, is it?

(End of this chapter)