1994: Vegetable farmers strike back

Chapter 292 Quotas
Xia Youche was somewhat surprised. "President Chen, we can't cut corners on packaging. What if there are problems during transportation? Who will be responsible then?"

"It's on me," Chen Jiazhi laughed heartily. "I built a cold storage facility. Starting today, the green peppers will be pre-cooled in the cold storage, then packed in styrofoam boxes and ice packs before being shipped to you. It's very reliable!"

"Hiss~ Cold storage?"

"Yes, and the foam box factory, that cost me a million in total. Now you can rest assured, right?"

"President Chen, you are indeed a man of great things; your actions are truly admirable!"

Xia Youche spoke with heartfelt sincerity, emphasizing the undeniable importance of cold storage for fresh produce. However, his expression changed the next moment.

"Shouldn't the price of green peppers be raised a bit?"

"Mr. Chen, you've really got a brilliant plan!"

"What do you think?" Chen Jiazhi pressed on, not giving the old man a chance to fool him. "Vegetable prices have been rising recently. A bag of green peppers weighs 30 jin, so 125 yuan per bag is reasonable, isn't it?"

"Okay, still send me 7 tons of green peppers every day tomorrow."

Xia Youche wasn't very willing, but considering how much he had earned from green peppers recently, he reluctantly agreed.

“But the supply quota for choy sum to Hong Kong is quite tight recently. You have to apply for it yourself. I don’t dare to ask for too much. I’ll send out one truck every two days. If there are too many, they might rot.”

"I have cold storage and small greenhouses, so the quality of my bok choy will be a cut above the rest!"

"We'll see," Xia Youche said thoughtfully. "I really don't dare to take more, much less offer you a high price. It'll be the same if you find someone else."

"Alright then." Chen Jiazhi smiled, seemingly unconcerned. "Actually, I don't have that much bok choy."

"Hmm~ Mr. Chen, green peppers should be your focus. This collaboration was very pleasant."

"I also want to extend the green pepper harvest season."

"I feel relieved that you know what's going on."

As soon as he hung up the phone, Chen Jiazhi couldn't help but mutter, "That old fox is about to start causing trouble again."

"What's wrong, Jiazhi?" Li Xiu was doing the accounting right across from him.

"Tongxingtai wants to suppress the price of bok choy."

"Why don't we find someone else? Didn't we go to Shenzhen last time?"

"Same here. There are plenty of vegetables lately, and the quotas are tight. All the bases are scrambling to produce vegetables. I'm afraid the vegetable merchants in Hong Kong have reached a consensus again."

"Then why can green peppers be used?"

"Because of scarcity, including last year's choy sum and the snow peas from the previous two months, many vegetable markets can't even meet their quotas, so it's natural for them to apply for supplies to Hong Kong."

With high profits and profit-driven businessmen, there will always be people who can't resist wanting to cooperate with us.

Chen Jiazhi explained patiently, and Li Xiu roughly understood.

"Hurry up and finish the accounts so you can go back."

"Oh."

After a minute or two, Li Xiu asked again, "Is it true that the only option for them to lower the price of bok choy?"

"maybe."

Chen Jiazhi thought for a moment and said, "Our bok choy has good quality control and is therefore scarce. As long as it receives a good response in the market, we can open up a larger market."

But the fastest way is still for God to play tricks and wipe out other people's vegetable markets, then our vegetables will naturally become popular.
Furthermore, we can bypass the Hong Kong market and instead export to other countries and regions such as Southeast Asia.

"Haha~ You're dreaming." Li Xiu was amused. "How could we possibly export? Being able to supply Hong Kong is already quite an achievement!"

"Why not?"

"Now that our refrigeration and packaging have caught up, the ability to preserve vegetables has been greatly improved. If we also focus on quality, this should be a viable path."

The more Chen Jiazhi thought about it, the more feasible it seemed.

Active quota management is limited to Hong Kong and Macao, but there are no quota restrictions for vegetable exports to other countries.

He has recently been cramming on finance and foreign trade knowledge. A few years ago, China introduced a tax rebate policy for vegetable exports, and the tax rebate alone could generate a good profit margin.

Vegetable exports have also developed rapidly in recent years.

The mere thought of taxes made Chen Jiazhi think of the food stall, "Hiss~"

"What's wrong now, Jiazhi?"

"Kaopu Fresh needs to hurry up with its finance department recruitment; they need to pay taxes!"

"An? Do we still need to pay taxes?"

"Yes!" Chen Jiazhi pondered. "According to this year's policy, wholesale vegetables will be subject to a 13% value-added tax."

"Our profit margins aren't that high!"

"Don't panic, there are still many tax deduction policies. For example, transportation can get a 7% deduction, and there are other options as well, so the actual tax burden isn't that high."

Chen Jiazhi couldn't remember the specific details, but he had a general idea.

The production bases that produce and sell their own products do not need to pay taxes, and the products supplied to Hong Kong from the bases are also tax-free. However, the two major businesses of Reliable Fresh, wholesale and distribution, are subject to a 13% value-added tax.

However, there are many deductible items.

Chen Jiazhi remembered that in his previous life, when he worked with his boss in Shanghai doing exports, the tax burden could be kept below 1.5%. With the addition of the 5% export tax rebate, the net profit from the tax rebate alone was more than 3.5%.

Around 2012, the vegetable distribution process was exempted from taxes, and export tax rebates were also eliminated. At that time, a number of export vegetable bases and enterprises that relied on low prices and tax rebates for survival were inadvertently killed.

Chen Jiazhi didn't know the current situation very well, but he figured it wouldn't be higher than that. Moreover, given the nature of the industry, there were many ways to reduce or avoid taxes, such as including loading and unloading fees in the acquisition cost.

These things need to be done by someone; it's not enough for him and Li Xiu to do them alone.

Chen Jiazhi noted this down and prepared to urge Chen Zhengxu to recruit more people. He then helped Li Xiu tally the accounts for file number 63.

After a flurry of activity, data points appeared on the paper. "Whew!"

"It's finished. Do you want to see it?" Li Xiu handed the manuscript to Chen Jiazhi in a good mood.

"Let's go back." Chen Jiazhi smiled and patted his chest. "I remember all the data from Jiangxin Market. Stall number 63 can't be too far off the beaten path."

"Hey, it's boring."

The situation in May was obviously much better than in April. In terms of vegetable market revenue alone, it was enough to double the 107 million yuan in sales in April.

Things got better month by month, and Li Xiu had long forgotten about the vegetables she threw away in the early morning.

"The green peppers are selling exceptionally well this month."

"good."

"You don't seem very excited."

Chen Jiazhi drove slowly out of the market. "No, I'm quite happy, but there's actually an opportunity to do better in terms of production."

The green pepper harvest has been underway for a month and a half, yielding approximately 123 million jin (615 tons) in total, with a yield of about 4100 jin (2,500 catties) per mu (0.067 hectares). However, this is still far from the expected yield.

"A yield of 4100 jin per mu is not low, and we can still harvest the fruit."

"Even if God doesn't interfere, we can only harvest for another 10 days or so at most, with a yield of about 5200 jin per mu."

It looks pretty good, but when Zhongjiao No. 5 was trial-produced in Zhanjiang, the lowest yield per mu was 6600 jin, and the highest was close to 10,000 jin, which is quite a difference.

"I think it's pretty good. Let's take it one step at a time."

"You're really easy to please."

"It's only been a little over a year! A year ago, you made me never even dare to dream that things would turn out this way!"

"Yes, it will only get better in the future."

After arriving home, Chen Jiazhi went to the market as usual.

The green bell peppers picked this morning have been put into storage for pre-cooling, and the styrofoam boxes are neatly arranged together.

Taking advantage of the good weather, the green bell peppers in the vegetable field are also being managed more carefully, including fertilizing, spraying pesticides, loosening the soil, and watering...

There are many factors contributing to the lower-than-expected yield. Firstly, Chen Jiazhi's expertise is not in growing sweet peppers, and he lacks specialized technical skills.

Secondly, the weather is unstable.

Finally, it is also inextricably linked to the current shift in the focus of vegetable markets towards bok choy, leading to lax daily management of green bell peppers.

After two more sunny days, with the bok choy harvest nearing completion, Chen Jiazhi contacted shareholders Xu and Huang to resolve the issue of vegetable supply quotas to Hong Kong.

Surprisingly, things went quite smoothly.

According to Xu Wenxiang, many vegetable markets did not perform well in fulfilling their quotas last year.

Jiangxin Vegetable Market produced a large quantity of bok choy in October of last year and at the beginning of this year. It actively cooperated with relevant departments to adjust the market gap and completed the temporary emergency supply task, relieving the pressure on relevant departments.

Moreover, the products are of excellent quality, have a good reputation, and are priced high.
In short, the leaders were very satisfied and remembered Jiangxin Vegetable Market, which was recognized as an outstanding enterprise and would receive a certain reward when the quota was increased.

However, the Jiangxin vegetable market didn't have any bok choy a few months ago, and I didn't apply for it, so the reward was put on hold.

If you apply now, the relevant departments will readily approve your monthly quota application for June.

The only thing to be aware of is that relevant departments will come to the base for random inspections and quarantine.

However, what Chen Jiazhi fears most is that no one will come.

He even regretted not applying for the quota himself; what a great opportunity to gain exposure and build connections!

However, he was indeed very busy, operating like a precision instrument every day, moving between the vegetable market and the marketplace.

Li Cai stubbornly stayed in another place to organize the supply of goods and did not return, sending out four truckloads of bok choy in two days.

Xue Jun also sold day and night, and made back the more than two thousand yuan he lost on the 26th.

Chen Zhengxu continues to expand his customer base, and the staff at Kaopu Fresh is also being replenished.

Chen Jiazhi and Li Xiu no longer go to the market so early. They sleep at home at night and set off after midnight, returning to the market after dawn, focusing more on market management.

In the past two days, the green peppers have recovered somewhat. Taking advantage of the sunny weather, we have been harvesting and storing them every day, picking as many as we can, and the yield has actually increased slightly.

Everything is gradually going smoothly.

On the evening of May 28, Chen Jiazhi walked through the fields. Green peppers were still being harvested, and bok choy would soon be on the market. He felt that the army was strong and the firepower was sufficient.

However, Yi Dinggan was not in a good mood and looked rather eccentric.

"Heavens above, please have mercy and send a rainstorm for the dragon boats! We can stay dry here, but please let it rain more everywhere else!"

Chen Jiazhi laughed and said, "Alright, there's no need to be so humble to God. The more humble you are, the happier He will be, and when He is happy, the weather will be good. On the contrary, you have to scold Him harshly to make Him angry, and when He is angry, He will think of raining as revenge."

"Huh~" Yi Dinggan said in surprise, "Now that you mention it, it seems to make some sense, but cursing God doesn't seem like a good idea."

Chen Jiazhi knew he was quite superstitious, so he didn't dare to curse heaven and earth indiscriminately.

"Alright, don't worry about it. Even with normal harvesting, the market's profit is still pretty good."

Jiangxin Vegetable Market was approved for a quota of 400 tons of fresh vegetables to be supplied to Hong Kong in June.

Chen Jiazhi is quite confident.

He believed in the quality of his vegetables and also believed that the Dragon Boat Festival rains that have graced Huacheng for thousands of years would surely arrive.

Xia Youche wanted to control sales volume and lower prices, while Chen Jiazhi was patient enough to wait.

(End of this chapter)