Siheyuan: Cooking journey

"The new joint venture factory will be set up near the instant noodles factory, which has been designated as light industrial land."

Lao Guo added with a smile: "In addition to this cooperation on cola, Beijing has also proposed to open another joint venture there for instant noodles."

"I have already agreed to this matter. The address will be next to yours so that we can compete face to face."

"Humph!"

He Yuzhu smiled and shook his head, saying nonchalantly, "Even if that well-known cola brand enters China, their marketing department will soon realize that the purchasing power of people here is not very strong, and there is actually not much potential to be tapped."

"Unless they can adjust the price to the same level as the ordinary soda here, it will be difficult to open up the market."

"But they are expected to sacrifice profits for this? This is obviously unlikely. It is more likely that they will observe for a while and then vigorously promote it when the time is right to seize the market."

"It will take at least a few years for the domestic market to mature."

“That’s still my optimistic estimate.”

"So during this period, we must prepare early and not let this big brand come in and monopolize the advantage easily."

Lao Guo's face was very serious.

This is not an exaggeration, but a real fact.

The country has a large population. With the development of the economy, people's living standards have improved a lot, their consumption capacity has also increased, and the consumer market has become more and more mature.

The number one brand will naturally not give up such a large market that is one of the largest in the world, and will certainly try every means to seize market share.

"So what are your plans?" Lao Guo asked seriously.

“My idea is actually quite simple…”

He Yuzhu said, "As you just said, the current beverage market is very prosperous, and there are a variety of products to choose from."

"By then, even if the No. 1 brand works harder, it will just add a few more beverages to the market, and the market share they can grab will be very limited."

"You should have done some research and know that besides Arctic Ocean, there are many other famous cola brands in China."

"The earliest origins of these brands can be traced back to production lines established with foreign investment before World War II."

“After the war, the state nationalized these assets and then re-listed them.”

"Just like the cooperation with Beijing Food Factory, if we can cooperate with brands from other places to build factories, while producing our own products, we can also help improve their quality and promote the diversified development of the entire domestic beverage market."

Lao Guo's expression became more serious. After thinking for a long time, he sighed and shook his head.

"Your idea is good, but it may not be very practical."

"If you do this, you will need a lot of investment in the early stages, and you won't see any benefits in the short term."

"It's not something the two of us can easily afford."

"You also know that according to current regulations, if we invest all our funds in the domestic market and fail to withdraw them in time, our overseas business will be affected."

He Yuzhu was very clear about this.

At present, in order to protect foreign exchange reserves, it is relatively easy for foreign capital to enter, but if it wants to go out, it must go through a strict approval process.

By the same token, any income earned from domestic investments can only be used domestically for the time being and cannot be transferred out immediately.

If it is a small investment, it is easier to handle because the cost is lower and you can always earn it back slowly.

However, if a large amount of capital is injected and all the focus is placed on the domestic market, it will not be a good thing for a large group if effective cash flow cannot be formed.

"This matter cannot be done in one go."

He Yuzhu explained: "You don't need to invest all at once, you can do it step by step. Try to invest a part first, and when you make a profit, if you can't take it out in the short term, you don't have to take it out. Just increase the number of cooperative factories gradually like a snowball."

After hearing this, Lao Guo thought about it and finally nodded.

“It is a feasible solution to operate this way.”

“But the problem is that it’s a bit too big.”

Lao Guo sighed and said in a heavy tone: "Besides that, I have a few other things I want to discuss with you."

"The military is interested in establishing a joint venture construction company. We can provide technology and equipment, and the other party will be responsible for manpower."

"If it's just purchasing equipment on your behalf, I'd be happy to accept it."

"But as for the joint venture, I think it involves too many aspects and I don't want to get involved too much."

"But if you're willing to get involved, I'll support your decision."

After the country's doors opened, more and more friends from abroad came here. To be honest, some domestic hotels are not as good as foreign ones in many aspects.

"In Yangcheng, we are planning to cooperate and build a five-star hotel."

"Yangcheng provides the location, we provide the capital, and we get the operating rights for ten years. After ten years, we will return the hotel to Yangcheng."

"It's not just Guangzhou. Big cities like Shanghai and Beijing also have similar ideas."

"This kind of project requires too much investment and takes up too much money. Considering my family's ancestral origin, I can't just turn down Guangzhou's kindness. I didn't agree to other cities' proposals."

"If you are interested, we can work together to run a chain of five-star hotels."

"There's one more thing."

"I am considering setting up a company called Golden Arches Food with Hongliang Group. Bringing the Golden Arches brand to all parts of the country will also be beneficial to the promotion of Fanta Cola."

The McDonald's brand is very popular in Hong Kong and Southeast Asia, mainly selling fried chicken and hamburgers.

Compared with KFC or McDonald's, it tastes better and is loved by diners.

Lao Guo wanted to develop it in the country, and He Yuzhu also agreed with this idea.

Hongliang has a state-owned background and is mainly responsible for the import and export of grain. It can be considered a good partner.

Working with them can only bring benefits and no harm.

As for building construction or five-star hotels, forget it.

The first item involves too many interests and is difficult to handle; the second item is too time-consuming.

"I'm very busy now. I also work part-time at a TV station..."

He Yuzhu found an excuse to evade the question, politely declined the suggestion, and then changed the subject, "I heard that a group of famous businessmen from Hong Kong Island went to the capital not long ago."

"Merchants are all smart and can naturally perceive the potential of the domestic market."

“What are their investment intentions like?”

Lao Guo shook his head helplessly and sighed: "You know, merchants are always thinking about making money."

“I want to invest money wherever there is benefit.”

"It's just that some people feel that the requirements for joint ventures are too harsh and want to open their own independent business."

"In addition, the land policy only allows leasing but not buying and selling, which discourages those who want to engage in the real estate industry."

“Most people are still undecided now.”

"While a small number of friendly investors are willing to invest, they also point out the unfairness of the current regulations and hope to gain greater autonomy in decision-making."

"The government has promised to consider changes but it is not clear how they will be."

"The big capitalists are keeping a wait-and-see attitude, and the small businessmen are following the big fish's footsteps and also adopting a conservative strategy and not daring to act rashly."

"Therefore, overall, investment promotion activities have temporarily stagnated."

After a short pause, Lao Guo said with emotion again: "When I went to Guangzhou and Japan before, I met many local entrepreneurs."

"The vast majority of them are not very satisfied with the current investment attraction measures provided."

"It is very likely that the terms will change in the future, otherwise it will be difficult to attract external funds."

“Whether it is Singapore or Japan, they will provide very cheap land resources when attracting investment.”

"Especially in Singapore, the land use rights are offered at low prices or almost for free, which has attracted a large number of entrepreneurs to invest and build factories."

"But we are not willing to give up too much of our own interests. We are also not willing to offer other preferential policies."

"It has to be done in the form of a joint venture. Moreover, the lack of free control and the resulting halving of profits are unacceptable to these investors."

From a businessman's perspective, what Lao Guo said is indeed correct.

From the perspective of the country, this is also necessary.

It’s a pity that the overall environment is like this.

He Yuzhu was not sure how long this persistence could last.

Perhaps, as Lao Guo said, in order to promote economic development and attract foreign investment, we may have to compromise in the end.

the next day,

He Yuzhu replied to Director Xu.

The advertising fee of two hundred thousand shocked the entire TV station.

At that time, most people's monthly income was in their 60s or 70s, and they could earn less than 1,000 yuan a year.

It is simply unbelievable that such a simple advertisement would cost two hundred thousand.

The staff worked overtime and finished the advertisement that same day, which was played on a loop on one device.

It’s just a picture of Coke, and the slogan is quite simple: Very Coke, the red Chinese people’s own Coke.

There weren’t many TV programs, so people watched the ad as entertainment and were curious about what this cola was.

The day after the ad was aired, the Friendship Store was crowded with people inquiring about this type of cola, and more than 600 bottles were sold.

This incident shocked Lao Guo, who had been in business for many years.

A bottle of Fanta Cola costs two yuan, which may be common in the future, but in this era when the average monthly income is less than 100 yuan, it is obviously beyond the consumption capacity of most people.

From selling only a few bottles a day, the daily sales volume suddenly jumped to over 600 bottles, demonstrating the strong purchasing power of this market.

In just three days, the slogan "Very Cola, the red Chinese people's own cola" spread throughout the city and became a new topic of conversation among people.

The sales volume of Coke at the Friendship Store has stabilized at more than a thousand bottles.

Drinking this cola is also seen as a high-end behavior, and people feel that being able to taste Very Cola is something worth showing off.

Even Ran Qiuye, who was always indifferent to worldly matters, had curiously asked several times whether the drink tasted good or not.

Even He Yuzhu himself was surprised by such excellent advertising effect, and it even attracted a phone call from his aunt.

The next day, a commentary article titled "What an Advertisement Brings Us" was published on the front page of the Workers' Daily, which affirmed the significance of advertising as a new thing, like a signal of some kind.

That day, after careful consideration, Director Xu found a foreign watch brand, Radar, and wanted to try to place a TV advertisement.

But when it comes to international relations, there are no specific guidelines, and Director Xu is hesitant.

"Coach He, is this possible?"