Feng Yu, Kirilenko, Fu Guangzheng, Fu Guangwei, and Li Zekai were sitting together. All of them had made high profits, and when they heard Feng Yu is going to invest in other areas, all of them expressed interest in participating.
“Since all of you want to enter a business with me, it’s fine. We are all friends, and I will not leave you all out. Do you all have any ideas about where to invest?”
Everyone’s energy level has a limit, and Feng Yu enjoys working with them and does not mind to entering into a business venture with them.
“I feel that electronics products have high potential, but our factories are too small. We should increase our scale.” Fu Guangzheng said.
“I had just opened up four factories in East Europe with Feng, and didn’t you say we are going to set up a factory in Canada and the US? Although the factories are meant for producing mobile phones, we can use it to produce other electronics products.” Kirilenko knows electronics products have high potential, but they should not expand recklessly.
“I think what Guangzheng said is correct. At least we must expand the production for Asia. With the economies of the Southeast Asian countries in decline, this is an opportunity for us to acquire factories in Malaysia, Thailand, etc. India is also a good choice as labor cost is low there. But we need to find local partners.” Li Zekai said.
“I feel that Tai Hua Supermarket’s growth is too slow. We should speed up our supermarket chain expansion. From China’s increasing spending power, 300 hypermarkets are not a problem, and we can still form a monopoly!” Fu Guangwei felt the supermarket expansion is too conservative and slow. When will they take over all the cities in China?
In China, there are more than 300 prefecture-level divisions. Excluding some out of reach places, there are at least 200 regions that are worth setting up Tai Hua Supermarkets.
Some of the provincial cities, etc. require at least five supermarkets, and at least ten in direct-controlled cities. With 300 Tai Hua Supermarkets in China, Walmart and Carrefour will be forced to leave the Chinese market.
Li Zekai’s face changed. If Tai Hua Supermarket is going to expand, his family might make some money. But his family’s Watson retail stores will be affected. This is not something he wants.
Although Li Zekai had expressed that he will not inherit his father’s fortune and wanted to set up his empire, but he will not want Tai Hua Supermarket to affect his family’s business.
“Investment in Hypermarkets is high, and many competitors had appeared. We are not the only supermarket chain, and might not continue to maintain our popularity.” Li Zekai retorted.
To set up 200 hypermarkets, they will need to invest at least 2 billion USD in total. Each of them will have to invest a few hundred million USD.
Li Zekai does not have so much money, and he knows Fu Guangwei also does not have so much. They must seek assistance from their family. But this amount is nothing for Feng Yu and Fu Guangzheng.
Fu Guangzheng added. “Guangwei, setting up more supermarkets is a must, but we cannot do it this way. The funds might not be a problem, but we don’t have enough management staff. If one of our Hypermarkets mess up and has negative news, our whole chain will be affected.”
“We will set up 50 more stores this year and will invest 500 million USD based on our proportions. The extra funds will be used to repay our loans. For manpower, we will hire and pouch some from outside other malls, and the promote from our existing staff. As for the minor issues, we can settle it later. Even if cannot accomplish this target this year, we must also buy the land parcels. What do you all think?” Feng Yu decided.
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Feng Yu knows what Fu Guangwei’s concerns were. Walmart and Carrefour might only have two to three hypermarkets in China, but they are doing quite well. Once they decided to enter the Chinese market at full force, they might be more popular as they are considered foreign supermarkets.
The cost will be higher for Tai Hua Supermarkets to expand at that time. They might as well start the expansion plans now to prevent Walmart and Carrefour from gaining a stronger foothold now.
Also, the land parcels at this time are cheap, and they get to reserve the best locations. They don’t need their stores to start operations now, but this will prevent other supermarket chains from competing with them in that city.
Tai Hua Supermarket had emphasized on the fact they are a Chinese brand and had slowly positioned itself in the hearts of many Chinese. Tai Hua Supermarket had also donated a lot of money in China and had increased its affinity with the Chinese.
Fu Guangwei and the rest exchanged looks and nodded. Every party only needs to invest tens of million USD, and they can easily afford it.
“Electronic products are also part of my plans, and one of the more important industries in the future. That’s why it is a must to increase production. We already have factories in East Europe and America. But we need at least three factories in West Europe and three to four factories in Southeast Asia. I am going to implement both plans at the same time. Are you all interested?”
Within two years, the mobile phone industry will be growing like crazy, and there are still MP3, USB drives, DVD players, LCD products, etc. The current production levels will not be enough to keep up with the demands.
Even the factories in China will not cope with the increased demands. In Feng Yu’s previous life, China still has to import all sorts of electronic products, and the volume is much higher than Wind and Rain and Aiwa’s current production.
Li Zekai and Fu Guangwei looked at each other and did not say a word. After investing in Tai Hua Supermarket, they don’t have much money left. After all, their profits from this crisis, not a lot compared to the rest.
“I can still invest some money into this venture. How much can I invest, and what’s the percentage of the shares?”
Every time Feng Yu invites Fu Guangzheng to invest. He will give him at least 10% of the shares. Fu Guangzheng does not want to get anything lower than 10%, and even if he does not have the money, he will get a bank loan, or ask his father or uncle for help.
Li Zekai gritted and said. “If Brother Feng agrees, I would also want to buy a stake in these new factories.”
Superman Li had raised a few billion USD to invest in South Korea, and although his returns are not by several folds, he made at least a few billion. He should not reject Li Zekai if the latter asked for a loan. After all, his father also agrees on the potential of electronics products. If Li Zekai did not participate in this venture, it would be difficult for him to get a stake in the future.
Feng Yu asked Kirilenko for his opinions. Kirilenko had no intention to invest, but seeing the rest agreeing to invest means the prospect of the electronics industry is good.
“Feng, count me in. I will just take 10% of the shares and will not participate in the management. I don’t mind paying higher.”
Feng Yu laughed. “Of course. Brother Fu, we will pick out the locations in West Europe and Asia and set up our factories, or we can acquire existing ones. I will leave this to you, and I will take care of the factories’ expansions in China.”
Fu Guangwei saw the rest of them deciding on setting up so many new factories, and Feng Yu is still the one owning the biggest share. How much does he need to invest in this venture? How much did Feng Yu make from this crisis?
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