Hong Kong Tycoon: Starting from Delivering Dongfeng Express

Chapter 157 Camel: Chairman Ye's noble intentions!

A murmur rippled through the room as everyone sat at the conference table.

Everyone agrees on the issue of drug prohibition, but the inability to set prices freely elicits strong reactions.

"President Ye, since you have so much influence in mainland China, can't you represent our association to give feedback to the postal service? Or protest to the government? If we can't even set our own prices, how are we supposed to do business?"

Ye Dongsheng sneered: "Ha! If any of you succeed in your protest, I will immediately hand over the chairmanship of the Hong Kong Island Express Association and resolutely support you from now on!"

Just kidding, at that time, the postal and telecommunications system was no less important than the railway system. In addition to its own postal, telecommunications, and banking functions, it also had its own dedicated railway and air transport lines, and even held some legislative power, and was drafting the "Postal and Telecommunications Law"...

Should we protest to the post office?
Who do you think you are?

Despite the fact that China's reform and opening up has been implemented for eight years, the vast majority of Hong Kong residents still don't know much about the mainland.

In fact, even decades later, with the internet and highly developed information technology, many Hong Kong residents still lack understanding of the mainland in various aspects, let alone now.

Therefore, it's really not surprising that a group of gangsters are unclear about or completely ignorant of the powers and responsibilities of various departments in mainland China.

At this point, the camel spread its hands and said, "If this won't work and that won't work, how are we supposed to do business?"

Jiang Tiansheng said, "Camel, if business were this easy, wouldn't it be like picking up money on the street? Everyone could get rich!"

The camel said irritably, "I only did it because it's so profitable! Who knew there would be so many rules and regulations?"

Ni Yongxiao interrupted the argument between Camel and Jiang Tiansheng: "Gentlemen, there's no use in arguing anymore. Why don't we listen to what Chairman Ye has to say?"

Seeing that everyone was looking at him, Ye Dongsheng spoke:

"Since we're all going to do this cross-border express delivery business and make money from the mainland, we have to abide by the mainland's rules. As legitimate business people, you should all understand this principle."

As for the method, the association will provide an industry guidance price, and everyone will set their prices according to this guidance price!

Upon hearing this, many people frowned.

Ni Yongxiao reacted quickly and asked immediately:
"President Ye, the guidance price you mentioned, it's not the same as the price of Dongfeng Express, is it?"
If everyone follows Dongfeng Express's pricing, how can any of us newly opened courier shops compete with you?

Immediately, someone chimed in: "That's right, Chairman Ye, if everyone has the same price, what are we even doing? We might as well just close down!"

These gangsters weren't stupid; they knew Dongfeng Express had been operating for several months and had a first-mover advantage. They wanted to compete with Dongfeng Express and steal its business, and a price war was the best way to do that!

This is a very blatant and even sharp contradiction. Who can blame them when Dongfeng Express has already monopolized the market? All newcomers can do is try to take market share from Dongfeng Express.

Ye Dongsheng smiled and then said:
"Now that I've taken the position of president of the express delivery association, I naturally have to consider the interests and future of the association and the entire industry."

Therefore, after discussion between Chairman Jiang and me, we set the guidance price as follows:

1-day delivery: 150 yuan; 3-day delivery: 80 yuan.

Jiang Tiansheng added, "This so-called industry guidance price is the lowest price in the industry, which is a minimum price line. Anyone engaged in cross-border express delivery from Hong Kong Island to the mainland must not set a price lower than this!"

As soon as these words were spoken, everyone started buzzing with discussion.

Ni Yongxiao asked again, "Chairman Ye, what will be the price of Dongfeng Express?"

Everyone immediately looked at Ye Dongsheng, after all, Dongfeng Express was an industry leader with huge influence. If Dongfeng Express also lowered its prices to the guidance price, it would mean nothing to them.

Ye Dongsheng scanned the crowd, taking in their expressions, and then said with a faint smile, "Dongfeng Express prices will remain unchanged, still 200 yuan for one-day delivery and 100 yuan for three-day delivery."

Hearing Ye Dongsheng say this, many people breathed a sigh of relief. It was good that Dongfeng Express's price was 50 yuan lower than the guide price, giving them a significant advantage in pricing compared to Dongfeng Express.

However, some people were still not satisfied and asked Ye Dongsheng, "Chairman Ye, isn't this guide price too high? Is 120 yuan too much?"

Ye Dongsheng scoffed: "You set it at 120 yuan? When he sees that you set it at 120 yuan, he'll lower it to 100 yuan, and some people will even lower it to 80 yuan or 70 yuan. If it keeps dropping like that, will anyone still make a profit?"

Then Ye Dongsheng said seriously, "Don't think that the association's guidance price is restricting you. We are protecting the interests of the entire industry!"
Even disregarding the reaction from the mainland postal and telecommunications bureaus, if everyone really starts a price war and keeps lowering prices, reducing the price from 150 to 50, the entire industry's revenue will decrease to only one-third of what it was before.

What we need to do now is to increase industry revenue within feasible limits, rather than engage in infighting and continuously shrink industry revenue!
Everyone works hard to earn money, not to finish the job only to earn less from one order than from three or even five!

Every delivery has a cost. If the cost of a delivery is 15 yuan, then a delivery costing 200 yuan would yield a profit of 185 yuan. However, if the cost is reduced to 50 yuan per delivery, the profit is only 35 yuan. In fact, doing 5 deliveries is less profitable than doing 200 yuan per delivery.

Anyone who has done business can understand this principle with a little thought.

At the same time, Ni Yongxiao thought of even more.

Price wars actually serve two purposes: first, to win over customers from the existing market, and second, to attract new customers with low prices.

However, due to the existence of the mainland postal service, cross-border express delivery cannot lower prices to attract ordinary citizens as customers, but can only target Hong Kong businessmen. Therefore, the market and customer base can be said to be fixed.

If the customer base and quantity are already fixed and there is no room for growth, then engaging in a price war and continuously lowering prices would be counterproductive.

Therefore, the best approach at present is indeed as Ye Dongsheng said: set a minimum price and maintain the profit on each order.

Doing this won't reduce the overall revenue of the express delivery industry by much; it's just a matter of whose pocket the money ends up in.

Ni Yongxiao looked at the group of people at the table. The only ones who caught his eye were Ye Dongsheng, Jiang Tiansheng, and Camel. Moreover, he believed that if they really started doing business, even Jiang Tiansheng and Camel would never be as good as him!

Therefore, if Dongfeng Express truly maintains its price of 200 yuan, and its "Lightning Delivery" service has a price advantage, Ni Yongxiao is confident that he can quickly rise to prominence and become a top-three player in the express delivery market! Having figured this out, Ni Yongxiao immediately spoke:

"I support the association's decision! Chairman Ye is absolutely right. Continuously lowering prices will only lead to the demise of our express delivery industry! The guidance prices set by the association are reasonable!"

After a moment of contemplation, Camel realized that doing this was actually beneficial to someone with his strength. How could those other small gangs compare to Tung Sing?

It's better if they can't continue. If these people earn less, then he, Camel, will earn more.
Camel smiled and gave Ye Dongsheng a thumbs up: "Chairman Ye, you are truly righteous! You deserve to be called a pioneer in the express delivery industry!"

With the support of Ni Yongxiao, Camel, and Jiang Tiansheng, even if one or two families present were still unwilling, they could not say anything more.

Ye Dongsheng nodded, then instructed a staff member to bring over a copy of the agreement and distribute it to everyone:

"Gentlemen, since everyone has reached a consensus, let's all sign this agreement!"

Ni Yongxiao picked up the industry agreement and looked at it. It mainly stipulated that they should abide by the industry rules set by the association, especially the two points that Ye Dongsheng had just emphasized: drug prohibition and minimum guidance price.

Without hesitation, he had the store manager and legal representative sign their names.

A moment later, after everyone had signed the agreement, Ye Dongsheng smiled and nodded. The two main objectives of this industry conference had been achieved!
In fact, whether it's drug prohibition or the minimum guidance price, the fundamental purpose is to protect Dongfeng Express's own interests.

Needless to say, drug enforcement is crucial; if someone were to engage in drug use, Dongfeng Express would inevitably suffer as well. As for the guidance price, its primary purpose is to ensure that Dongfeng Express doesn't lose too much market share.

He knew that once these new players entered the market, price wars would be unavoidable. Even if he explained clearly that price reductions might cause an industry crisis, when others didn't even have customers, they wouldn't care about damaging the market or whether the industry would be shut down. They would just use tactics to seize the market first!

Price wars have been one of the most effective methods throughout history. Moreover, cross-border express delivery has a large profit margin, and if left unchecked, someone will definitely lower the price to below 100 yuan.

If this were to happen, Dongfeng Express, currently the largest player in the industry, would suffer huge losses. If it lowers prices, it would lose profits and face risks. If it doesn't lower prices, it could lose countless customers.

Now that a minimum price of 150 yuan has been set, even if some customers are lost, Dongfeng Express has been operating for several months, and its professionalism and reputation speak for themselves. Its service is also incomparable to these new players, so many old customers will still stay.

Moreover, even if there are losses, they will only affect some customers in Jinghai for the time being, and the markets in other places should not be affected in the short term.

Now that everyone has reached a consensus and temporarily joined the same camp, and the rules have been established, Ye Dongsheng can borrow their power!
Ye Dongsheng, holding the agreement in his hand, said, "Everyone, now that we have signed the agreement, we are partners on the same side!"

The association will announce the rules set today to the entire industry. Not just you individuals, but everyone in the industry must abide by them!

If anyone violates this rule, we will join forces to boycott them and drive these bad apples out of the industry, eliminating them completely!

Jiang Tiansheng immediately chimed in, "I agree!"

Ni Yongxiao pushed up his glasses: "I agree too!"

The camel leaned back in its chair and chuckled, "Of course I have no problem!"

Seeing that these powerful groups had all voted in favor, what could the remaining small and medium-sized organizations say? Of course, they could only follow suit!
Then Ye Dongsheng smiled and said, "Our express delivery industry association is newly established and there are still many shortcomings. If you have any opinions, please feel free to raise them!"

Meanwhile, there is currently a vacancy for vice president of the association. Anyone who wants to contribute to the industry can apply by contacting me and President Jiang!

Industry associations typically have one president and several vice presidents. However, since the express delivery industry is still in its early stages, it's not advisable to have too many vice presidents. In addition to Jiang Tiansheng, one more vice president would be sufficient.

This temporarily vacant vice president position can be considered as bait thrown out by Ye Dongsheng.

Sure enough, both Ni Yongxiao and Luo Tuo's eyes lit up when they heard about the position of vice president.

Camel smiled and said, "Since Chairman Ye says so, then I, Camel, naturally want to do my part for our association. Can I nominate myself?"

Ye Dongsheng nodded and smiled, "Of course, no problem!"

Ni Yongxiao also smiled and said, "Although I am not as senior as Boss Luo, I am still quite energetic. I studied abroad for a few years and would like to participate in the development of the express delivery industry in Hong Kong. I wonder if Chairman Ye would approve of me."

If I become the vice president, it will definitely benefit my own courier store; there's no doubt about that.

Although the express delivery association has only just been established, it will definitely have an influence in the future if it develops well.

Ni Yongxiao had only been back from abroad for less than a year. For him, who wanted to clean up the Ni family's name, the position of vice president of an industry association was currently attractive. With some effort, he might be able to become the president in the future.

Keep in mind that this is a legitimate, officially recognized industry organization. With enough influence, you can even use it as a springboard to run for parliament!

Hong Kong's future return to the mainland is already a foregone conclusion, and cross-border express delivery inevitably involves dealing with the mainland. In the future, as the president of the express delivery association, he might be able to make a lot of connections on the mainland through this.

In Ni Yongxiao's view, this was a perfect way for him to get out of poverty!

Ye Dongsheng smiled, then looked at the others: "Is anyone else here?"

The others glanced at Camel and Ni Yongxiao. Even if they had originally had such thoughts, they could only suppress them at this moment, after all, they were no match for them in strength!

Seeing that no one responded, Ye Dongsheng smiled at the two and said, "Mr. Luo, Mr. Ni, I see your enthusiasm, but if you want to become the vice president, you still need to contribute more to the association!"
If someone puts in the effort, everyone will see it and be convinced of their worth. At the next general meeting, everyone will vote to decide this position!

Ni Yongxiao and Camel exchanged a glance and smiled at each other, but there was a hint of irritation in their eyes.

Seeing this, Ye Dongsheng smiled. It was impossible for Dongfeng Express to stop all the new players entering Hong Kong Island on its own.

But now that Dongfeng Express has made concessions, it has temporarily brought together Hung Hing, Tung Sing, and even the Ni family. This force is already quite formidable!

(End of this chapter)