Reborn, back to a small county town to become a wealthy family

Chapter 705 The Gap Through Comparison

"Chairman, I didn't do that kind of thing."

Shang Guozheng quickly denied it, while explaining, "I did transfer a very pretty young girl to administration, but I absolutely did not touch her. Zhengyang Group is yours, so the good stuff should be yours too!"

"?"

Luo Yang was stunned for a moment after hearing what was said, and then he didn't know whether to laugh or cry.

"Nonsense!"

He pointed at Shang Guozheng with his finger: "What kind of person do you take me for?"

"Chairman, you haven't seen that little girl. She's so beautiful. She hasn't even fully grown up yet. She'll definitely be a great beauty in the future."

Shang Guozheng showed no awareness of being criticized and continued to promote the product: "If there is anything imperfect, it may be that her cultural education is not up to par. She only completed the second year of high school, so her education level is a bit low. I talked to her once before, and the girl is quite sensible. We are just waiting for you to come back to arrange for her to work in the board office."

"He thinks about frivolous things all day long."

Luo Yang glared at him, then changed the subject, saying, "Didn't you just say you had several things to ask me about? Continue!"

"oh oh."

Shang Guozheng quickly ended the casual conversation and continued his report: "Fengshang Men's Wear has signed the first batch of franchise agents, including 2 first-level agents, 35 second-level agents, and 71 third-level agents. The franchise fees, decoration fees, and other expenses of these agents have been received, but the chairman still needs to decide how to use the security deposit."

Franchise fees and renovation costs go without saying; once they're deposited into Fengshang Men's Wear's account, the money belongs to the company.

However, the security deposit is different; this money is used to bind the agents.

In the apparel industry, headquarters generally provide guidance prices. Even when discounts are offered, there are limits. Clearance sales also have specified time limits. Without such strict regulations, the entire brand's pricing system would be in chaos.

The deposit is used to prevent agents from violating the regulations, especially the pricing system.

However, some agents secretly pursue a strategy of low profit margins and high sales volume, selling at reduced prices without the headquarters' knowledge. Even if they are caught by the headquarters during inspections, the only penalty they face is the forfeiture of some of their deposit.

Some larger distributors even bribed the manufacturers' market inspectors to turn a blind eye.
Due to frequent violations, it's considered quite high if agents can get back even half of the deposit they submitted.

Given this context, why is Shang Guozheng now asking Luo Yang about the purpose of these security deposits?
"Old Shang, how much of the deposit have you received so far?"

Luo Yang asked calmly, "Do you intend to use this money elsewhere?"

"Chairman, the company currently has 975 million yuan in margin in its account, all of which are subject to a two-year restriction period."

Through the previous probing, Shang Guozheng found that Luo Yang was not so sensitive, so he boldly said, "This money is unplanned and not included in the company's financial accounts. It can be borrowed and used. 975 million yuan can allow Coolpad Men's Clothing to enter several more planned cities or economically developed prefecture-level cities. The profits generated in two years will far exceed this figure. Even if these deposits are returned to the agents in the future, it will still be worthwhile for us."

"Your idea is quite good."

This demonstrates a deep exploration of internal potential, and Luo Yang was very satisfied that Shang Guozheng thought this way.

"Then I'll submit an application and report it to the group headquarters."

Seeing that Luo Yang did not object, Shang Guozheng immediately smiled and said, "With the 4000 million you previously approved for me, Coolpad Men's Wear is confident that it can expand to more cities and seize more market share in the second half of the year."

"Let's look at the year-end sales data summary."

Luo Yang calmly said, "Let the data speak for itself."

Shang Guozheng nodded.

He also knew that in the clothing industry, no matter how eloquently you speak, in the end, it's all about sales figures.

"There's another matter related to raw material procurement."

After finishing the second matter, Shang Guozheng picked up his teacup, took a sip of tea, and paused for two minutes before starting to talk about the last matter.

"What's wrong? Is there a problem with the raw material supply?"

"There were no problems with the supply of raw materials before. The main issue was that we wanted to apply to the chairman for foreign exchange quotas."

After putting down his teacup, Shang Guozheng replied, "The designs for the second half of the year require high-quality fabrics that cannot be produced domestically. They will need to be imported from South Korea, which will require foreign exchange."

Although China is the world's largest producer of clothing fabrics, it has only been 12 years, and some high-end fabrics still need to be imported. This situation will not improve for another five or six years.

By then, China will truly be number one in the world, both in terms of output and quality.

"How much do you need?"

Luo Yang clicked his tongue and said, "Won't we be going to exceed the planned funding again?"

"No, the men's clothing section will use the planned funds to exchange for foreign currency in equal amounts."

Shang Guozheng quickly shook his head, then added, "According to the production plan, we will need about 800 million US dollars."

"Okay, you can submit the application report."

Although a portion of the US dollars was withdrawn in June, the company's foreign exchange reserves increased by more than ten million US dollars in July due to orders for erotic lingerie.

After finishing his report, Shang Guozheng concluded his presentation for the day.

Before we knew it, more than two hours had passed.

Fortunately, Luo Yang did not take a lunch break, and Shang Guozheng left at just past three o'clock.

No sooner had he left than Su Yutong walked into Luo Yang's office.

"You've been waiting outside the whole time?"

Luo Yang was surprised by how well the two connected.

"I had some things to discuss with Director Sun, so I came ahead of time."

It had been more than a month since I last saw Su Yutong, and her face had become more sharp and confident. I didn't know if it was because her cheeks had become thinner or because of the changes brought about by her work.

"If I remember correctly, the market for women's clothing is mainly in the Yangtze River Delta region, with only a few scattered cities in other provinces. Do you really need to spend more than a month traveling around inspecting these markets?"

After Su Yutong sat down, Luo Yang took away the teacup that Shang Guozheng had been drinking from, rinsed another cup, and poured her some tea.

"The inspection only took a little over a week."

Su Yutong knew that Luo Yang's words just now were not a question, but a joke and a tease.

"The main focus is on supervision."

Luo Yang could joke, but Su Yutong, as his subordinate, had to explain: "Both are located in the Yangtze River Delta region, in adjacent cities, and both are shops in the best locations in the city center, yet their sales figures differ by several times."

The two cities have similar economic levels, similar urban resident populations, and similar consumption habits.

In this situation, Su Yutong couldn't think of any other reason besides a problem with the team that could cause such a large discrepancy in the sales data of directly operated stores.

"I transferred elite sales personnel from cities with good performance to form a new team, which directly took over the city's directly operated stores."

Su Yutong reported: "After half a month of testing, it has been proven that the problem was indeed with the sales team. The elite sales team that was sent to provide support has achieved two to three times the sales performance of this store in the past month."

"So you're developing a sales team across the entire region?"

Luo Yang put down the teapot, lit a cigarette, and then asked, "Aren't you afraid of wasting so much effort only to benefit someone else?"

In the same shopping mall, there is competition between brands of similar level. If a store has outstanding sales performance, the top members of the team will be poached.

Strengthening yourself while attacking your competitors is the simplest business strategy.

"Don't worry in the short term."

Su Yutong replied confidently, "Because our women's clothing brand is not very large at present, and the market is limited to the Yangtze River Delta region and cities in a few provinces, it means that once we expand, we will need a lot of regional managers, regional managers, and city managers. With so many vacant positions available, the more outstanding the person, the more reluctant they are to leave Midnight Phantom."

"You're good at making empty promises!"

Luo Yang smiled and gave Su Yutong a thumbs up.

"I learned it all from the chairman."

Su Yutong replied shyly, "It's just the tip of the iceberg; I need to keep working on it." "Are you sure this is flattery, and not an implication that the boss is good at making empty promises?"

Luo Yang chuckled, puffing on his cigarette as he said, "Looks like I haven't been making any grand promises to you, have I?"

"You haven't made any grand promises to me, but you've made plenty to other senior executives at Zhengyang Group."

Su Yutong smiled slyly: "And everyone ate it, so now they're all full of energy and working together towards the goals the chairman outlined."

A nationally renowned brand?

Year-end bonus?
Or should it go public?

Luo Yang himself didn't even know what promises he had made, so he couldn't give Su Yutong a proper answer.

"Let me tell you about my work over the past month."

He could only change the subject: "Old Shang just asked me for three things. What about you? Have you encountered any difficulties in developing the women's clothing business?"

"There shouldn't be any at the moment."

Su Yutong replied without pausing, "Even if there are any, we can handle them internally."

Wow, so confident?

"So, according to you, you're not planning to expand the market in the second half of the year?"

Because the funding for the women's clothing plan was approved at the end of last year, Su Yutong did not include it in the funds for market expansion. Even though the sales performance in the second quarter was very good and booming, if she wanted to expand beyond the Yangtze River Delta region, she would have to apply for additional funds from Luo Yang.

"Chairman, did you forget to make the provision?"

Su Yutong understood the implication in Luo Yang's words perfectly. She smiled and reminded him, "Our women's clothing budget for this year is based on this year's target. However, if we exceed the target, the excess amount can be applied for and used in advance this year."

"Did you exceed this year's targets?"

Luo Yang asked with great interest, "How much of the annual target did you achieve in the first two quarters that makes you so confident?"

To expand the market, the funds required are not just a few million or tens of millions.

Just like Shang Guozheng's menswear, even for a brand like Coolpad that already has a certain brand effect, it would take nearly 5000 million yuan to expand into the capital cities of more than a dozen provinces and a few planned cities and economically developed prefecture-level cities.

"As of June 30th, our women's clothing division has already completed 93% of its annual target!"

Su Yutong blurted out a statistic that stunned Luo Yang.

"what?"

Luo Yang asked in shock, "We've almost reached the annual sales target set last year in the first half of the year?"

"Ah."

Su Yutong nodded affirmatively and said, "To be precise, we can complete the annual target before the end of July."

What are the annual targets and related expenses?

According to what Su Yutong just said, the sales performance of women's clothing will definitely double again in the second half of the year, so Luo Yang wants to know how much the accrued expenses are.

"3472.5."

Su Yutong stated a precise figure, then added, "Our women's apparel company plans to apply for the use of excess sales accrual fees in the third quarter to expand into markets in provinces such as Beijing-Tianjin-Hebei, Shandong, Fujian, and Guangdong. In the fourth quarter, the accrual fees will be used to expand into markets in provinces such as Jiangxi, Hubei, Hunan, and Sichuan-Chongqing."

"I feel like you've got me hooked."

After pondering for a long time, Luo Yang finally spoke: "Last year you told me to develop steadily, so the targets you set were relatively conservative. Was this year's surge within your expectations?"

"how is this possible?"

Su Yutong's eyes widened immediately: "Chairman, you can't reverse cause and effect and falsely accuse people!"

As she spoke, she pointed to her cheek with her finger.

"At the beginning of the year, I was plump and had smooth skin, but look at me now, I've lost weight and my skin has become dull and lifeless."

Su Yutong complained, "I'm only twenty-four years old, in the prime of my youth, and now I've turned into this, isn't it all for the sake of increasing women's clothing sales?"

Luo Yang: "."

What she said made so much sense that I was speechless.

"How about I approve a week of paid leave for you?"

Luo Yang felt a little embarrassed, so he offered to make up for it by saying, "If you go on a trip, I'll reimburse all your expenses."

"Midnight Phantom has finally achieved some success, how can they relax now?"

Su Yutong shook her head and said, "I don't want a vacation."

"Then what do you want?"

"I can't think of that now."

"Expired and void."

"no!"

Su Yutong said urgently, "You're the boss, you have to keep your word. I just haven't thought it through yet. You have to save it for me, and I'll honor it when I've made up my mind!"

"Okay, I'll save it for you!"

After teasing his subordinate, Luo Yang smiled and nodded in agreement.

Su Yutong immediately became delighted.

She now resembles a female college graduate who has only been out of school for a few years, lacking the sharp edge she had when she entered the office.

"Besides applying for the use of excess accrual fees, are there any other matters that need to be reported?"

“There is one.”

Su Yutong said cheerfully, "For the fall recruitment fair in the second half of the year, I hope the company's human resources department can set up a recruitment station at Donghua University. I want to recruit a few outstanding fashion design interns as reserve talents to train in preparation for the next step of establishing a new women's clothing brand."

"Have you already started preparing for online sales?"

Luo Yang immediately guessed Su Yutong's intention in doing so.

"Yes, that's my plan."

Su Yutong said, "It's not just Donghua University, but also Jiangcheng Textile University, Capital Institute of Textile Technology, and other well-known domestic schools with fashion design programs. They all want to recruit talent."

"Given the current reputation and scale of our Zhengyang Group..."

Luo Yang clicked his tongue and said, "Besides offering high salaries, we have no other advantages. Moreover, our office location needs to be in a big city, otherwise our attractiveness to outstanding talents will be further reduced."

"Then let's set up a design studio in Shanghai."

Su Yutong decisively offered her advice: "Chairman, designers can't work in isolation. They need to stay at the forefront of fashion. In China, there are no more cutting-edge cities than Beijing, Shanghai, Guangzhou, and Shenzhen. So it's imperative to set up a design studio in Shanghai."

"Yes, your suggestion is correct, I approve it!"

Luo Yang replied while thinking, "To do online business, besides these things, you also need to cultivate talent in media."

"Media studies?"

Su Yutong was somewhat puzzled and asked, "Why is it necessary to have a talent pool in this area?"

She didn't know about live-streaming e-commerce, nor did she know that the future belongs to the era of traffic.

Unless you plan to go for a premium, accessible luxury approach.

(End of this chapter)