How can you become a star without money?

Chapter 237 A single move affects the whole body
"Sure, Mr. Wan, let me know in advance whenever you're interested. The venue is ready anyway, and we also have a partnership with the most advanced medical aesthetics and skincare company in Korea. We can exchange ideas on skincare techniques then."

Wang Yao smiled and looked at Cheng Qiyuan: "As for the herbal tea, Mr. Cheng has already invested in it, right?"

“Yes, we’ve invested nearly 1 million in the production line. Currently, in terms of both technology and efficiency, it’s no worse than Wanglaoji. The highest daily production capacity is close to 50 cans.” Cheng Qiyuan nodded.

Before going public, they had already identified herbal tea as the second most profitable part of the group's revenue, so naturally they invested heavily in it, even using the most advanced equipment in the world.

"President Cheng, do you accept my suggestion?" Wang Yao asked with a smile.

“Mr. Wang is Ba Wang’s savior and a shareholder, so I naturally accept his humbly.” Cheng Qiyuan smiled.

"If we enter the market now, the offline sales team for herbal tea will need to be at least 10,000 people to catch up with the other companies. Even if we assume an average salary of 2000 yuan per person, the annual fixed cost will be at least 200 million yuan, which is a heavy burden for BaWang right now," Wang Yao pondered.

Offline channels rely entirely on ground promotion. Even internet companies like Alibaba need a ground promotion army of 100,000 people, not to mention the beverage industry, where salespeople need to visit supermarkets and restaurants one by one.

“Indeed, the initial channel promotion costs are quite high.” Cheng Qiyuan nodded.

He originally hoped to leverage the shampoo's offline channels to promote the herbal tea, but now it seems the shampoo's offline channels are unreliable, and he still needs to reorganize the team.

"I just checked. Last year, Wanglaoji's revenue was less than 10 billion yuan, but its advertising and marketing expenses were nearly 500 million yuan. Even industry leaders like this spend at least 5% on marketing every year, while new brands need at least 15-20% or more."
"Assuming the herbal tea line needs to achieve 1 billion in revenue, it would require at least 200 million in marketing costs. With personnel and marketing combined, it would need 400 million in costs. How is BaWang's cash flow right now?" Wang Yao asked.

Cheng Qiyuan's lips twitched upon hearing this. It was originally a good thing, after all, a listed company with a market value of 50 billion yuan could easily raise this amount of money every year. As long as the projected sales were achieved, it could both stimulate the stock price and provide new financing channels.

But now that things have changed, it's uncertain whether the stock price will be able to return to 30 billion after trading resumes. It's almost halved, and the main business has suffered a setback. He's not sure either. But the production line is already running, and stopping it for even a minute would result in losses of tens of thousands.

"To be honest, we can get through this if we grit our teeth," Cheng Qiyuan said with a smile.

"I thought the herbal tea line was too risky; it would be better to make hair conditioner instead," Wan Yu said casually.

Cheng Qiyuan remained silent, which suggests that the two sides do indeed have some disagreements about the company's development.

"I don't know much about the herbal tea and traditional beverage market, but I am quite interested in the tea beverage market. Herbal tea, as a representative beverage of Chinese intangible cultural heritage, is very suitable for cultural export because of its concept of food and medicine being of the same origin."

"I've heard there are four types of herbal tea: diaphoretic tea, cold-relieving tea, dryness-moistening tea, and dampness-resolving tea. Does Mr. Cheng have any related patents or specialties for these?" Wang Yao asked rhetorically.

“Of course we have these, and our family’s recipe is based on ancient methods.” Cheng Qiyuan nodded, somewhat surprised that Wang Yao, a northerner, knew about herbal tea.

"There are three things that Chinese people can't escape in their lives: endless kidney tonics, endless dampness removal, and endless internal heat. Wang Laoji and his team have already deeply rooted the influence of their cooling herbal tea, and it is almost impossible to shake it. So even if we compete, we must differentiate ourselves."

My suggestion is to focus on herbal teas that dispel dampness, starting with female consumers. Dampness affects the spleen and stomach, which in turn affects the skin. Dispelling dampness addresses two key concerns: weight loss and skin health.
"Although it tastes bitter, as long as it's well-promoted, or if we change the flavor with a gimmick, it still has a certain market competitiveness. What do you think, Mr. Cheng?" Wang Yao asked again.

Cheng Qiyuan blinked: "President Wang's angle is brilliant, but most herbal teas are associated with dietary habits. For example, Wanglaoji is associated with hot pot, and Heqizheng is associated with family gatherings. If we only target women, wouldn't that be a bit too narrow?"

"The consumer market is related to the population and the usage scenario. In theory, consumers with needs for weight loss and skin care, as well as their repurchase rate, are much higher than those of the household consumer group," Wang Yao said with a light laugh.

“He doesn’t understand the purchasing power of the female market. Mr. Wang, please excuse his ignorance,” Wan Yu said with a light laugh.

"My idea is that direct competition is too stressful and costly. We might as well take a different approach and first capture a specific group to at least support ourselves."

"I happen to be interested in the herbal tea market, and I'm also going to partner with BaWang to create a new brand called BaWang TuJi. President Cheng will be in charge of production, and I'll be in charge of marketing. I'll take 70% of the shares in the new company, and we'll operate it as two separate lines from President Cheng's own BaWang herbal tea. It's all just a trial," Wang Yao said with a smile.

Upon hearing the name Ba Wang Tu Ji, Cheng Qiyuan's heart skipped a beat.

Because this name is so good, it immediately evokes the image of the popular character Yu Ji. Wang Yao, despite his young age, does have some talent in marketing. He can make consumers remember him very well just by choosing a name.

Moreover, Wang Yao asked for 70% of the shares right off the bat, instead of the 40% equity plus 20% commission model like shampoo brands, which shows that he is quite optimistic about this company.

Cheng Qiyuan, being a businessman, immediately grasped the importance Wang Yao placed on the matter: "How did President Wang decide on this joint venture ratio?"

"Actually, I just took advantage of Mr. Cheng's payment terms." Wang Yao smiled frankly: "Mr. Cheng has excess production capacity, and large companies are trustworthy with excellent formula systems, saving me the trouble of finding a processing plant. I won't take too much. At most, I will hold Mr. Cheng's payment terms for 1 million yuan in the early stage. I will pay back the money after the sales situation opens up in six months. After all, I also need to reduce marketing and promotion costs."

Cheng Qiyuan fell into deep thought after hearing this.

A payment of 3000 million yuan, based on the cost of herbal tea, is roughly equivalent to 1 million cans, less than 1% of the entire market size, but nearly one-third of BaWang's current total production capacity. This can alleviate a large part of the production capacity pressure. Although the payment period is long, in the long run, if this sub-brand can really be operated, it will be beneficial to the company's revenue.

However, according to the books, this 1 million in payment for goods is at most 2 million in revenue, and the so-called marketing cost investment is only 4000 million.

Wang Yao's decision to exchange 4000 million for 70% of a startup company with 1.4 million in revenue is quite shrewd.

However, Cheng Qiyuan was also very clear that he was now in a position to ask Wang Yao for help.

“No problem. As long as Mr. Wang is confident in the herbal tea market, I am naturally willing to support him,” Cheng Qiyuan said with a smile.

He came to see Wang Yao today for two reasons: first, to express his approval and gratitude for the handling of the BaWang incident; and second, to hope that Wang Yao could provide some advice to BaWang on marketing, especially for the herbal tea business line.

Now that his goal had been achieved, Cheng Qiyuan was very happy, but he was also secretly wary.

"You know, we now have subsidiaries on both of our business lines cooperating with Wang Yao. What if, in the future, the revenue and development of these sub-brands surpass BaWang, and Wang Yao has so many shares? Could it be that..." On the way back, Cheng Qiyuan kept thinking about whether he might follow in the footsteps of Chengtian Entertainment.

Although Wang Yao is young, he doesn't seem to be a pure and innocent person.

“If a subsidiary really surpasses its parent company, it only means that the parent company is poorly managed. From a corporate perspective, it is only right for the parent company to step down and make way for a more capable one.” Wan Yu glanced at Cheng Qiyuan.

"What do you mean by that? That I'm incompetent?" Cheng Qiyuan said in a deep voice.

"Old Cheng, you don't need to be so sensitive at your age. Just focus on making money and managing the company well. As for your abilities, results will prove them. After all, you are the founder of BaWang." Wan Yu scoffed dismissively.

Before the company went public, the two had disagreements about the company's future development direction. Now, after experiencing another major upheaval, the existing rift seems to have widened even further.

Wang Yao's strategy for Ba Wang Tu Ji was not the traditional offline canned sales, but rather to accumulate exposure through the milk tea sales model first.

Ba Wang Tu Ji can directly utilize Mixue and Tianhuo's offline sales channels, initially selling it as a single product. A bottle of herbal tea with a cost of about 2.5 yuan can be poured into a milk tea cup with a traditional opera-style logo, and with some ice, it can be sold for 15 yuan.

Unlike Mixue, which takes a mid-to-low-end approach, Ba Wang Tu Ji goes straight for the high-end, putting all its costs into packaging and marketing. Its unique packaging and product placement in variety shows like "Dance of a Thousand Years" and "Superman" are sure to attract attention.

The dancers in "Dance for a Thousand Years" have figures and temperaments that most women aspire to, perfectly aligning with the selling points of Ba Wang Tu Ji's product: removing dampness and aiding weight loss.

Then, as a 'featured product,' it is exported to overseas KT coffee shops, and after some overseas marketing events, its positioning changes from a beverage to a 'fashion item.'

Then, they sell their small-sized canned products on e-commerce platforms, and finally open their own independent offline stores, thus entering the tea beverage financing market.

Moreover, Wanglaoji and Jiaduobao were currently engaged in internal strife, giving them ample time to develop. Most importantly, both marketing and product costs could be covered by credit, making Bawang Tuji essentially a zero-cost startup.

The more resources you have, the lower the cost of starting a business or investing.

Wan Yu will most likely participate in the Ba Wang Scalp Care Experience Center project, which should further accelerate the expansion of Tianhuo Cinemas.

However, the importance of resource integration is a double-edged sword. The deeper the entanglement, the more likely it is that a single move can have far-reaching consequences. Therefore, when Wang Yao chooses partners, they are either relatively simple or easily controlled.

While Qi Jianhong of Yaolai and Tan Hui of Xingmei are not the best partners in essence, they are among the best partners.

Cheng Long once again organized a dinner party at Qi Jianhong's mansion in Hong Kong. After touring the dozens of limited-edition/rare luxury cars in the underground garage, Wang Yao finally found some of the atmosphere that a nouveau riche should have.

"Tell me which car Mr. Wang likes, and you can drive it." Qi Jianhong's voice was cheerful and full of energy, exuding the aura of a typical entrepreneur who had left the system to start his own business.

The cars in this garage are estimated to be worth over a billion yuan, with each one costing at least eight figures, yet Qi Jianhong described them as commonplace, like an Alto.

"I don't know much about cars. I usually prefer comfort and am used to riding in a motorhome," Wang Yao politely declined.

"What about a watch? Mr. Wang is still young and not at the age to collect watches. I recently acquired a limited edition RM 001 from 01. It's an old piece, and I'll give it to Mr. Wang as a handheld accessory later."

Wang Yao doesn't know much about watches, but he has heard of the RM 001. Although it's an entry-level model, its value should be in the millions. Qi Jianhong giving him this watch is just right. It's not too deliberate, nor too cheap. Moreover, the fact that it's an old piece indicates that it has a certain collectible value.

“I don’t really know much about watches.” Wang Yao raised an eyebrow slightly.

Qi Jianhong is an expert in cars and watches, and he speaks eloquently about them. After browsing through Qi's collection of luxury cars and watches, Wang Yao felt his legs were a little sore.

This is just one of Qi Jianhong's assets in Hong Kong.

"Meihe, call him uncle." Cheng Long said to Wang Yao while holding a little girl who looked about ten years old.

"He's clearly my older brother, Godfather's talking nonsense again," Qi Meihe said in a childish voice, her big eyes fixed on Wang Yao's face.

"Don't call every handsome guy 'brother,' or you'll become a lovesick fool and get fooled by men." Qi Jianhong took his daughter and laughed, "This is my daughter, Qi Meihe."

"I didn't know the child was here, so I didn't bring any gifts," Wang Yao said with a smile.

He still had some impression of Qi Meihe, who claimed to be a second-generation post-00s along with Nana, Wenye, and Arthur, but she was also a disappointment.

"Oh, that's too formal. Come on, let's go eat first, and try the red wine I just got." Qi Jianhong waved his hand.

Qi Jianhong's family has dedicated "attendants," all of whom are young, beautiful, and highly educated hotel management students in their early twenties. They sit next to the guests during meals and serve them the dishes.

"How many companies does Mr. Wang own in Hong Kong?" Qi Jianhong asked with a smile.

"Currently, we only have one branch office; the brand we co-owned with BaWang is located in mainland China," Wang Yao said with a smile.

“Don’t underestimate the power of just one company; it’s almost equivalent to ten years of your hard work,” Cheng Long joked from the side.

“Of course, heroes emerge from among the young. That’s why we’re called the ‘Shanghai Prodigies.’ We had such a hard time making money back then,” Qi Jianhong said with a smile.

“Making money is not easy. No matter how much valuation is on paper, it’s just paper. It’s not as valuable as President Qi’s garage.” Wang Yao shook his head.

“That’s true. Money is best kept in your pocket. Last year, I was terrified when they put me on the rich list. Making money steadily and peacefully is the real thing. Who would believe me if I said I couldn’t come up with 50 million in my account? Can you come up with that, brother?” Qi Jianhong chuckled.

“My money is all in my own hands, of course I can take it out,” Cheng Long said dismissively.

"Where's President Wang?" Qi Jianhong asked with a smile.

"I can still come up with 50 million in cash flow, and even several times that amount," Wang Yao said with a slight smile.

"Tsk, so the new generation really does make money faster." Qi Jianhong sighed softly, seemingly quite worried.

"How's the conversation with Lao Cheng going?" Cheng Long changed the subject.

Wang Yao discussed the follow-up developments of BaWang, including BaWang's leading efforts to define ingredient safety standards, the planned establishment of the Herbal Research Institute, the creation of two shampoo sub-brands and a herbal tea brand, and the expected resumption of trading next week. He added that they should wait and see how the stock price performs.

"Does Mr. Wang think Ba Wang can recover its value?" Qi Jianhong asked again when Cheng Long wasn't cooperating.

"I'm not sure. Who can predict stock prices? But I'm certain that BaWang's offline channel resources will shrink significantly, which will greatly affect revenue in the second half of the year." Wang Yao shook his head.

"It's such a pity that a decent daily chemical brand has finally emerged." Qi Jianhong nodded.

"As long as the foundation is still there, there's always a chance," Wang Yao smiled.

"Mr. Wang, which do you think has better development prospects, real estate or film and television? Old Wang from Wanke wants to bring me into the industry and invest in shopping mall complexes like Wanda, but I am personally more interested in film and entertainment, in response to the call from above," Qi Jianhong said.

“I can’t speak for real estate, but film and entertainment is definitely promising. As long as the scale is controlled, the development prospects over the next ten years are quite considerable. I heard from my older brother that you’ve already invested in Project City?” Wang Yao said with a smile.

"It's just a small-scale operation, nothing compared to what Mr. Wang is doing. I plan to open five Yaolai Film and Television Cities this year, which will have a total of sixty or seventy screens and a maximum capacity of around ten thousand people," Qi Jianhong said.

“It’s already quite large. This scale is almost the same as the fourth largest cinema chain I acquired in Korea,” Wang Yao said with a smile.

"Huh? Mr. Wang is making another big move? In the Korean market?" Qi Jianhong raised an eyebrow slightly.

"Yes, Mr. Tan and I both believe that we should invest domestically and also consider overseas markets. In the future, our films still need to go global to make money, and more importantly, we need to enhance the reach and influence of Chinese culture."

"Skyfire may begin integrating cinemas in Japan and Southeast Asia in the second half of the year, aiming to capture at least 10% of the market share. They are also in talks to acquire AMC Theatres," Wang Yao said casually.

Upon hearing this, Qi Jianhong raised an eyebrow and smiled, "President Wang and President Tan are really making a big move. AMC is probably the largest theater chain in the US now, so the acquisition cost must be quite high."

"They're asking for $15 billion, but they're nearly 100% in debt, so they're still considering it. After all, it's better to be cautious about investing overseas when you're unfamiliar with the place," Wang Yao said with a smile.

Qi Jianhong was horrified. The way young people these days brag is truly frightening. They often talk about investing the entire market value of Yaolai Company.

What's even more frightening is that Wang Yao and Tan Hui together actually have that kind of strength.

“Actually, it’s best not to invest in China when it comes to overseas investments. Tianhuo Cinemas is listed on the Hong Kong Stock Exchange, which makes it very susceptible to the influence of Chinese concept stocks. We could consider finding more people to list in the US, which would be better for the stock price,” Qi Jianhong said after a moment of contemplation.

"Oh? How so?" Wang Yao asked curiously.

“With AMC being such a large entity, Mr. Wang could consider acquiring a portion first, pushing up Tianhuo’s current stock price, and cashing out a portion. Then, he could find another shell company to package the remaining portion and acquire Tianhuo’s part. This way, he could not only obtain a complete AMC but also cash out multiple times,” Qi Jianhong said with a smile.

"Does President Qi have a suitable shell?" Wang Yao raised an eyebrow slightly.

Qi Jianhong put down his chopsticks and smiled.

"Le's is going public, Mr. Wang must have heard about it."

(End of this chapter)