A century-old wealthy family that rose from Shanghai

At a meeting of the Yangtze River Industrial Group, heads of various industries are reporting on their work.

Sun Dehe, head of Rongchang Heavy Industry, also reported on the company's performance: "In the past year, Hong Kong's real estate market continued to boom, and Rongchang Heavy Industry supplies more than 70% of Hong Kong's steel (Hong Kong's steel consumption is around 20 tons) and more than 60% of its aluminum alloy doors and windows. At the same time, our steel products are also sold to Southeast Asia, amounting to about 10 tons annually. In the machinery industry, we can already produce a significant amount of products for Hopewell Zippers, and we can also produce for the shipbuilding industry. Our yachts have entered the Asian market, with 18 sold in the past year. In terms of ship dismantling, due to the large number of ship dismantling yards in Hong Kong, many of them are spending huge sums of money to acquire old ships in overseas ports, resulting in thin profit margins in Hong Kong's ship dismantling industry."

Rongchang Heavy Industry has developed into a comprehensive enterprise integrating smelting, machinery and manufacturing.

Although the shipbuilding industry is still in its infancy, once the new composite yacht is completed, it may be able to rival the industry in Europe and America.

Sun Dehe is a highly professional smelting talent, but he is gradually transforming into a comprehensive management talent, just like Tong Runfu did back then.

Chen Guangliang said, "The shipbreaking yard is just a side business for us, and we don't plan to invest in it long-term. We can stop this business when the profits are insufficient. Smelting, machinery, and manufacturing are the core of Rongchang Heavy Industry's future development."

Of the three major industries, smelting may have shifted in the 1980s, while manufacturing will remain, but the most important one will be the 'yacht industry'.

In Chen Guangliang's vision, Rongchang Heavy Industry should become a world-class yacht manufacturer from the mid-to-late 1960s.

Sun Dehe nodded and said, "Okay. However, a lot of the scrap steel from Hong Kong shipbreaking yards is sold to Rongchang Heavy Industry for remelting."

At this moment, Sun Dehe was unaware of his achievements in the field of metallurgy in his previous life. Of course, even if he had known, he would not have regretted his choice. Now, he is a prominent figure in Hong Kong, a top earner, and his children are greatly benefited by him.

Senior managers like Sun Dehe and Tong Runfu, although not heads of the group, have the highest incomes among all members of Chen's Enterprises. This is because they not only have management skills, but also top-notch technical skills in the industry.

Next, Su Dongsheng, the person in charge of Huatai Plastics, gave a report:
"Last year, the total output value of plastic flowers in Hong Kong reached 6 million, but we predict that it has reached its peak. This year, there is indeed no room for growth in this industry, and some families in Europe and America have also begun to gradually stop pursuing plastic flowers."

"Huatai Plastic Flowers' total output value last year was 1.2 million yuan, accounting for 20% of the market share; at the same time, its profit margin also fell to 20%."

"Huatai Plastic Flowers stopped its large-scale expansion three years ago, so for the past three years we have been pursuing OEM and agency models. We have about 500 families doing OEM for us, and we also act as agents for products from more than 20 medium-sized factories."

After listening, Chen Guangliang emphasized, "Your prediction is correct. European and American families are gradually losing their preference for plastic flowers, and this industry has already entered a period of decline."

He often travels overseas for research, so he would pay attention to such matters. Moreover, this is an inevitable historical trend, and it's not difficult to spot the signs.

Su Dongsheng nodded and continued, "In the toy sector, we continue to maintain a good annual growth trend. In the OEM field, we manufacture Barbie dolls for 'Audrey Toys' in the United States, delivering more than 10 units every month. Our own toys are also maintaining a 10% annual growth rate in exports. In addition, our branded toy 'Kidswant' currently has three stores in Hong Kong."

Toys are a sunrise industry, and one that will never fade.

In the 1950s, both Hong Kong and Japan were striving to develop their toy export industries, resulting in fierce competition.

Using his skills, Chan Kwong-leung secured the OEM industry for Barbie dolls for Hong Kong, and also laid the foundation for Hong Kong's plastic doll industry technology and production lines, achieving remarkable results in exports.

At the same time, Huatai Toys also manufactures toys for European and American toy manufacturers, not caring that the profits are less.

Of course, Huatai Toys is also developing its own patented products, including Rubik's Cubes, plastic building blocks, train tracks, and even owns a toy brand called Kidswant.

Chen Guangliang continued:

"Toys are a timeless industry that we should focus on developing. I have two ideas: First, we should have our own patented products to enhance the 'Kids King' effect of our brand, such as Rubik's Cubes, building blocks, and toy trains, so that we can have some confidence in competing with other toy brands in the world."

"So, I recently came up with another 'patented product,' which is to develop a claw machine based on the 'Yili excavator-style candy machine.' The 'Yili excavator-style candy machine' was an early American bucket-type candy-grabbing machine, but we need to make significant changes. First, we'll change the bucket to a grab bucket; second, we'll try to incorporate electronic technology, adding a timer and coin-operated counting function; and third, the prizes will no longer be candy, but dolls or plush toys, etc."

Su Dongsheng quickly jotted it down in his notebook, quite surprised that his boss could be so meticulous despite being so busy.

Tao Yun, the head of Midea Electric Appliances, took the opportunity to say, "Midea Electric Appliances can also provide technical support for claw machine machines."

Today, Midea Group has been promoted to a "group-style" enterprise, becoming a company at the same level as Xinfeng Textile Group, Rongchang Heavy Industry Group, and Huatai Plastics Group.

Therefore, Tao Yun's status in the group also rose accordingly.

Of course, he also understood that the boss valued the future, and that Midea's current output value was insignificant within the entire group.

Chen Guangliang nodded and said, "Yes, any technology between groups must be mutually supported."

Back then, thanks to its vast talent pool in shipbuilding machinery, Swire Group not only quickly restored Hong Kong's shipyards after the war and built a 6000-ton ocean-going vessel, but also rapidly established Swire Engineering to provide maintenance and repair services for aircraft in Hong Kong.

This is the power of technological accumulation!
Over the years, Chen Guangliang's Rongchang Heavy Industry Group has accumulated a lot of technology and still has considerable strength in ship repair. As long as it does not involve major repairs, there is no need to go to Japan; the problem can be solved locally in Hong Kong, saving a lot of costs.

Next, it was Tao Yun's turn to report from Midea Electric Appliances:
"We currently export 2 Midea brand radios per month, accounting for nearly 20% of Hong Kong's total market share. As for electric fans, we export 2.5 units per month, with quality comparable to Japanese products. Finally, we have successfully completed the initial research and development of telephones, and the next step is to prepare for their market launch."

"Hong Kong's electronics industry was spearheaded by us, and also by the radio industry. Currently, Hong Kong has 14 electronics factories, and its annual radio exports have exceeded one million units, with the main markets being the United States and the United Kingdom." "At the same time, some European and American electronics companies are interested in investing in Hong Kong. Hong Kong's electronics industry is already in a period of development, and we believe it will experience rapid growth in the future."

Tao Yun also analyzed the general trend of Hong Kong's electronics industry, predicting that Hong Kong will usher in a major wave of development in areas such as transistor packaging and military radar production.

In the previous life, by the 1980s, Hong Kong's electronics industry had replaced textiles and clothing as the largest industry (electronic watches were the world's second largest, telephones and program-controlled exchanges rose to prominence, electronic components, etc.).

Chen Guangliang later analyzed: "Hong Kong's radio exports have increased very rapidly, and Japan probably won't sit idly by, since our transistors are mainly imported from Japan. Therefore, Midea radios need to plan ahead and examine transistors from Britain and the United States, so that we won't be unprepared if Japan cuts off the supply of transistors to Hong Kong."

Tao Yun nodded and replied, "Okay, we will take this matter seriously."

However, at this moment, Chen Guangliang suddenly thought of something: In 1959, Japan's annual transistor production had surpassed that of American companies. About 55% of the transistors produced by Japan were used in radios, and more than 70% were exported. American semiconductor companies, which were being squeezed, began to look for new ways out.

At that time, Noyce, who was still Fairchild, initially considered Japan, which had a foundation for development. However, the Japanese market was not friendly to Fairchild. The Japanese government at that time prevented Fairchild from investing in and building production facilities there, and forced Fairchild to transfer its patent rights to NEC at a low price. Fairchild was then facing the serious problem of rising production costs and narrow sales channels.

Thinking of all this, Chen Guangliang said to Tao Yun, "Try going to Fairchild Semiconductor in the US to investigate and introduce the advantages of setting up a factory in Hong Kong. For example, our labor costs are less than one-tenth of those in the US, but our efficiency is twice that of the US. The production process of civilian transistors requires more manpower than other transistors. Hong Kong is clearly very suitable for the US transistor industry at this time. Facing strong pressure from Japan, it is imperative for them to set up a factory in Hong Kong. We hope they will set up a transistor molding and packaging factory in Hong Kong. In this way, we will no longer need to source goods from the US and UK."

The early introduction of Fairchild radios would benefit the development of Hong Kong's radio industry and hurt the Japanese radio industry, which was something Chen Guangliang was happy to see.

Tao Yun replied without hesitation, "Okay, I'll get on it as soon as possible!"

In the past year (1960), Cheung Kong Industrial Group generated a huge profit of HK$8000 million, making more money than Cheung Kong Holdings and Ping An Financial Group.

Yan Zuhe returned from his inspection trip to the United States and excitedly approached his brother-in-law Chen Guangliang to discuss opening a Chinese fast food restaurant.

Meanwhile, Chen Guangliang received his brother-in-law in his office at Cheung Kong Holdings.

"Brother-in-law, the fast food industry in the United States is developing very well, but I have some concerns. Hong Kong people are used to being served, so will they accept Chinese fast food?"

The fact that Yan Zuhe was able to raise questions shows that he had at least given them serious thought.

Chen Guangliang stated directly, "Whether it's acceptable or not can only be determined by the market. These are some suggestions and plans I have for Chinese fast food. Please read them carefully, and you should also thoroughly investigate the Hong Kong catering industry before making a comprehensive investment decision."

He can complete these plans in half a day, so there is no waste of time.

Moreover, since it concerns his brother-in-law's future, he is willing to invest some time and energy.

Yan Zuhe immediately began to carefully read the expected results:
【1. Establish a Cafe de Coral fast food chain, adopting a combination of Chinese and Western styles. Each branch should typically offer more than 100 different food items, and have a good market positioning.

Second, most of the food for each branch is supplied by a central food processing plant. Food is centrally procured, processed at the plant, and rigorously inspected before being delivered to each branch. All ingredients and seasonings are pre-selected, and the branches are only responsible for the final cooking. This approach strengthens control over food costs and quality, and also saves each branch considerable amount of kitchen equipment and manpower, thereby significantly reducing expenses.

Third, Cafe de Coral should pay attention to the selection of branch locations. The principle of site selection is to choose locations near commercial areas, shopping areas, office buildings and residential areas with high pedestrian traffic.

Fourth, in the early stages of its business, Cafe de Coral placed great emphasis on promoting its overall image and food. After achieving a certain scale, it launched a series of promotional campaigns, frequently appearing in the media. Cafe de Coral secured a stable customer base before the large-scale arrival of Western fast food, leaving subsequent Chinese fast food restaurants far behind.

Fifth, Cafe de Coral should learn from the strengths of Western fast food and adopt modern corporate management and standardized operations. For example, all chain stores should have standardized decoration and design, signage, menus, price lists, cash registers, table seating arrangements, kitchen hygiene, and employee uniforms and services, adopting and learning from the practices of Western fast food restaurants.

Based on his own investigation, Yan Zuhe said, "Brother-in-law, do you mean we should open a store on the main island first, and establish a central kitchen with multiple stores?"

Chan Kwong-leung said, “We will have a flagship store in Central, and one branch each in Wan Chai and Causeway Bay, targeting white-collar workers and tourists as our main customer base. We will also establish a central kitchen, so all three stores and the central kitchen will be completed in the first year. I will have Cheung Kong Holdings and you form a joint venture, each holding 50% of the shares, and you will be responsible for the specific operations! Of course, it won't affect your involvement in real estate.”

Yan Zuhe quickly replied, "My money is only enough for small-scale real estate ventures. Naturally, I want to focus my energy on this restaurant chain."

Chen Guangliang said with satisfaction, "Yes, you have to be focused when you do things. Besides, after establishing the Cafe de Coral chain restaurant, there will still be opportunities to invest in properties in the future, such as buying shops when prices are low and investing in properties. Of course, the premise is that we succeed."

"Okay, thank you for your guidance, brother-in-law!"

Chen Guangliang smiled, picked up his teacup, and said, "As an entrepreneur, you not only need to develop step by step in a down-to-earth manner, but you also need to have a strategic vision. Do your best, strive to make a name for yourself, and make your father-in-law look at you with new respect!"

Yan Zhiduo had two sons; the other son, Yan Zuxiao, was born to Xu Qingwan.

Of course, Chen Guangliang also took care of Yan Zuxiao, helping him open his factory, which was a way of repaying Xu Qingwan for his help back then.

"Hmm" (End of Chapter)