Hong Kong Island: From a small stall to a global supplier

Sham Shui Po, Cheung Wah Building.

When Giordano was founded, it was a small brand. Its production and processing were all supplied by small clothing workshops in the industrial buildings in Sham Shui Po, so the headquarters was located here from the beginning.

After the business expanded, considering the low rent and the ability to adjust production based on sales and inventory in real time, they didn't make any changes.

Wang Yaotang's Hongdou Apparel was different. It relied on roadside stalls and newsstands to boost sales from the start. It needed to have a larger production scale, and later moved its factory to the mainland. Therefore, its office has always been located in Tsim Sha Tsui.

This was Wang Yaotang's second visit here after he acquired Giordano.

"Giordano is bigger than Red Bean in terms of both revenue and scale, why don't you ever care?" As they went upstairs, the four-eyed guy asked the question that had been on his mind for a long time.

“The Analects, Book 1: When the father is alive, observe his will; when the father is dead, observe his conduct; if for three years he does not deviate from the way of his father, he may be called filial,” Wang Yaotang asked.

The conversation between the two was naturally audible to those around them. The security guards, including Sha Ze, could understand each word, but they couldn't understand the meaning when put together.

Wei Tao fell into deep thought. The gangsters were becoming more and more knowledgeable, and he, a graduate of a regular university, was going to fall behind. What should he do?
The bespectacled man frowned. "I don't understand."

"Following Xiao Gui Cao's example," Wang Yaotang rephrased.

The four-eyed guy seemed to understand yet not quite, saying, "Explain."

"Confucius used 'family' to illustrate the way an heir should act," Wang Yaotang explained with a smile. "When I took over the company from the Li family, both the other shareholders of Giordano and the company's external leadership were actually quite uneasy. At that time, the more I did, the more chaotic the company would become. On the contrary, doing nothing could stabilize people's hearts."

“Then you’re not following Xiao Gui Cao’s rules now,” the four-eyed guy laughed.

Wang Yaotang knew he was referring to Shengyi's matter. "The Book of Changes says: 'When things reach an extreme, they change; when they change, they become accessible; when they become accessible, they endure.'"

"Brother Yao, can we talk this out properly?" The four-eyed guy looked speechless.

"With Dongshu assassinated, internal strife has broken out and external troubles have arisen. Shengyi is in dire straits and can only change its approach at this time."

"Brother Yao, aren't we getting tired of talking like this?" the four-eyed guy said irritably.

“You call me a rough and uncouth person, but now that I’m well-read and knowledgeable, you still find me hard to understand. Why are you so difficult to please?” Wang Yaotang said with a laugh.

The four-eyed guy chuckled, "If that's what you mean, then I think it's better to be a bit more江湖 (jianghu, a term referring to the world of martial arts and chivalry), at least it's less tiring, right, Aze?"

Sha Ze nodded vigorously, "When Yao-ge spoke just now, I felt like I couldn't breathe."

Wang Yaotang burst into laughter, "Making you study more is more painful than killing you, Wei Tao, what do you think?"

"Well, it's good that the boss is still keeping his original style." Wei Tao chuckled awkwardly. Using allusions and classical allusions was too obscure, and trying to figure out what the boss meant all day long was too tiring, especially since it didn't give him a raise.

"You bunch of good-for-nothing bastards!" Wang Yaotang laughed and cursed.

When Giordano's General Manager Lu Heng heard that Wang Yaotang was coming, he led all the senior leaders downstairs to greet him.

Upon receiving the notification that the big boss, Wang Yaotang, was coming to inspect the company, Lu Heng, who was in a meeting with senior management, immediately stopped the meeting and looked seriously at the group of vice presidents and managers, each with their own factions. "I want to warn you all," he said, "our big boss is different from the previous Mr. Li. Don't get any ideas just because he hasn't been paying attention to the company."

"In other companies, if you make a mistake, you'll get a few words of reprimand, and at most you'll be dismissed. But this big boss is different. There are some things I can't say too explicitly, but I can tell you with certainty that if the boss finds out you've done something wrong, you'll be lucky to end up in jail!"

"If there were any problems before, fix them yourself as soon as possible. That's all I have to say. Now come downstairs with me and wait for the boss to come."

But they've been keeping a close eye on the big boss's every move. They've heard rumors that the shooting was carried out by the Irish Liberation Organization, not by the boss himself, and that he ate the 30-plus dead people.

In the blink of an eye, Sheng Yi got into a fight with the soda factory. In just a few days, he heard from his friends at the police station that the police had handled more than 600 conflicts, and there were even more that were not reported to the police. Hundreds of people were killed or injured!
"Wang Sheng." Lu Heng quickly took two steps over.

"General Manager Lu, I hope my sudden visit hasn't disrupted your work?" Wang Yaotang asked with a smile, extending his hand.

"The entire company has been hoping that Mr. Wang could give us some guidance. Our whole team has been working very hard, afraid of not doing a good job." Lu Heng quickly reached out his hand.

If no subordinate offers their hand, you should consider whether the superior is willing to shake your hand.

“Being cautious is good; it shows you’re not arrogant and have a sense of awe, which reduces the chances of making mistakes. But at the same time, don’t be timid and afraid to do anything. If a tree stops growing for a long time, it means there’s a problem somewhere, and it needs to be cut down.” Wang Yaotang made a chopping gesture, which made Lu Heng shudder.

“Wang Sheng’s words are truly enlightening. We have been unable to find a balance between the two, and we still need Wang Sheng to guide us further,” Lu Heng said respectfully.

“Aren’t you having a meeting? Let me listen.” Wang Yaotang stepped up the stairs.

The building doesn't belong to Giordano alone; there are many companies inside and a lot of people coming and going. However, the area in front of one elevator was completely cleared out by security, just waiting for Wang Yaotang.

Wang Yaotang, Four-Eyes, Wei Tao, Sha Ze, and several other managers, including Lu Heng, went up first, while the others waited to take other elevators.

Upon entering the conference room, Wang Yaotang naturally sat in the main seat, with the four-eyed man sitting beside him, Wei Tao sitting behind the two of them, and General Manager Lu Heng sitting to the side.

"Mr. Wang, shall I have someone give me an overview of the current situation of the Giordano brand?" Lu Heng asked softly.

"can."

Chang Minnan, the deputy general manager in charge of the sales department, immediately said: "Mr. Wang, Giordano currently has 38 stores in Hong Kong Island and 26 stores overseas. Since 1982, the total sales of spring clothing have reached 5200 million, or 29 pieces, of which 75% are from Hong Kong Island."

"Overseas stores account for 40%, but sales only account for 25%?" Wang Yaotang looked at Wang Changdong, the vice president in charge of the overseas department.

Wang Changdong immediately stood up and explained, "Mr. Wang, overseas sales are limited by local economic conditions and cultural constraints..."

"Alright." Wang Yaotang waved his hand. "You've been telling me all this so you expect me to solve your problems? What's the point of having you as the deputy general manager then?"

Wang Changdong was speechless.

"I hired you to solve problems, not to create them for me. Remember that!" Wang Yaotang's cold gaze swept across everyone's faces, and everyone who met his eyes involuntarily lowered their heads.

"If you encounter problems in the company's development, you should solve what you can. If you can't solve them, then pass them on to me. That's fine. But don't create trouble for me. If you can't solve the problem, then I'll have to deal with the person who created it."

With the power of life and death over hundreds of people, and the ability to influence the livelihoods of thousands in a single thought, Wang Yaotang exuded a powerful aura that, when fully unleashed, brought immense pressure to those around him.

"What's the profit margin for overseas stores after deducting rent, employee expenses, and tariffs?" Wang Yaotang asked Lu Heng. Lu Heng replied in a low voice, "15%, which accounts for 8% of the company's overall profit."

Wang Yaotang scoffed, "An investment of over 5000 million yuan, and all you got in return was an 8% profit increase?"

Seeing Lu Heng hesitate, Wang Yaotang said, "You mean to say that the domestic market is difficult to develop further, the market competition is fierce, and opening up overseas markets is a way out, then why is the target market Southeast Asia?"

“Most Hong Kong brands expand into overseas markets in Southeast Asia, where there is cultural similarity, familiar distribution channels, and strong purchasing power among Chinese consumers,” Lu Heng explained.

"Others are developing Southeast Asia, and you're following suit. But which of you has ever lived in Southeast Asia for an extended period of time?" Wang Yaotang asked, glancing around the room.

Everyone bowed their heads.

"Do you even know what the average temperature is in Singapore all year round?" Wang Yaotang didn't expect them to tell him. "It's between 25 and 32 degrees Celsius all year round. Who the hell are you going to sell your leather jackets, knitwear, and sweaters to?!"

It's impossible to say these people don't understand; the sales figures speak for themselves.

I know, but I won't change.

Whoever raises the problem should solve it. If no one can solve it, then everyone should pretend they don't know anything, since no one has lost money anyway.

"Do you have any shops in Taiwan, South Korea, or Japan?" Wang Yaotang asked Lu Heng.

"Yes, there are 3 in Taiwan, 2 in South Korea, and 3 in Japan."

What percentage of the total overseas sales do these eight companies represent?

"It accounts for 60%," Wang Changdong said.

"A little more detail," Wang Yaotang asked.

"Among these 8 stores, the 3 stores in Taiwan have the best market performance, reaching 70% of that in Hong Kong Island. The stores in South Korea and Japan are slightly behind. Our current product line does not include cotton-padded coats or down jackets."

"Has Fatty Li made no adjustments to the overseas store situation?" Wang Yaotang asked Lu Heng.

“Yes, initially we were thinking of developing in Southeast Asia, but after finding that the results were not good, we started to explore the markets of Taiwan, South Korea, and Japan, hoping to determine the future development direction based on market performance, and then…” Lu Heng pursed his lips.

Wang Yaotang let out a "heh," and then killed himself.

“General Manager Lu, open a branch in Singapore and recruit local fashion designers to design specifically for the Southeast Asian market, instead of just selling products from Hong Kong.”

“Okay, Mr. Wang.” Lu Heng nodded immediately. They had already thought about this, but they hadn’t yet reached an agreement on how to balance the interests of all parties in the branch office.

"for how long?"

"2 months."

"I'll give you two weeks, can you do it?"

"Ah, yes!" Lu Heng gritted his teeth.

"I'll talk to the Commerce Bureau in Haojiang and we'll open shops there directly. You can decide the quantity and size yourselves. I want to see results."

"it is good."

"We have established a branch in Taiwan, and will focus on the Taiwan market in the future."

"it is good."

Actually, the better market is in mainland China.

With a large enough population base in mainland China, and people now aspiring to the glamorous lifestyle of Hong Kong, ordinary brands here become high-end goods there, making it not difficult to open up the market.

Prior to 1992, China imposed strict restrictions on foreign investment in the commercial retail sector, generally prohibiting foreign brands from opening stores at will. It wasn't until 1992 that six major cities and five special economic zones were allowed to pilot one or two joint venture or cooperative commercial retail companies, with projects submitted by local governments to the National Children's Hospital for approval.

Wang Da'ai, a businessman, has now failed to pry open this door.

"Let's talk about the development of Hongxing Clothing."

“Hongxing has not performed as well as expected in Hong Kong.” Lu Heng frowned and said, “Of course, it is profitable. Since its opening, sales have exceeded 5000 million, and the gross profit margin is around 3000 million.”

"Sexy lingerie is for flirting. Do you even check the brand before you make it?" Wang Yaotang scoffed. "Fatty Li is dreaming. He even named it 'Red Apricot.' Who would buy Red Apricot for their wife? Is he hoping she'll cheat on him?"

"In the future, Hongdou Apparel will merge with Giordano to form a group company, operating both brands simultaneously. Hongdou will leverage Giordano's overseas channels to expand internationally. I'm informing you of this in advance so you can be mentally prepared."

"Before the merger, we will conduct a rigorous audit of all departments of the company. We will make sure to fill any gaps that exist beforehand. Don't say we didn't warn you."

His words sent chills down the spines of everyone present.

"Alright, that's settled." Wang Yaotang stood up, and Lu Heng and the others quickly followed suit to see him off.

Wang Yaotang left, but Four-Eyes didn't. Not to mention the complicated issues of company mergers, Red Bean needed someone to oversee its expansion overseas through Giordano's stores in various locations.

Whether to open a new store or turn the unprofitable Giordano store into a profitable one, Lu Heng dared not make a decision. Wang Yaotang didn't have time, so it could only be the four-eyed guy.

Wang Yaotang had other matters to attend to before leaving; Crown Prince Rong was waiting for him.

Giordano: Changhua Building:

General Manager: Lu Heng
Financial Manager: Ping Yake
Deputy General Manager (Sales Department): Chang Min (Male)

Deputy General Manager (Overseas Department): Wang Changdong
Publicity Department: Wen Yao
Design Department: Ying Haitao (End of Chapter)