Reborn in 08, a heretical cultivator starting a business

Chapter 164 The Uncrowned King, Tencent Regrets!
The future international warehouses will all be industrial parks of 500 to 600 acres, with 300,000 square meters of storage space!
This project is so large; it's definitely the highest benchmark in the country and a key logistics project.

The central government's fixed asset subsidies will definitely reach the cap of 15%, and the interest subsidy will also be up to 3%!

Local governments will also be very generous, offering subsidies of up to 10% and interest subsidies of 2%!

Tax rebates will also be provided.

What? You won't give it to me?
Or they gave too little.

Other cities offer a 10% subsidy for fixed asset investment, but you only get 5%!

Other cities offer a 2% interest subsidy, but you only get a 1% subsidy?

Other cities receive a 70% refund of the local portion of value-added tax, while you only receive a 30% refund?

That's alright, let me check on your brother's city!

With just a dozen or so international warehouses, and dozens of companies vying for them across first- and second-tier cities nationwide, Wang Junshan has no worries at all.

As a result, major cities offered the best treatment and the highest subsidies.

The actual cost of the logistics park in the capital city was reduced to 3 million yuan, and it was even lower in second-tier cities.

In a second-tier city, an industrial park of 500 to 600 acres with a total warehouse area of ​​300,000 square meters would cost around 400 million yuan in total.

Through some clever maneuvering, the actual expenditure was reduced to 3.2 million.

The 4 million yuan bank loan provided by the local government will not only be more than enough, but there will also be a surplus to be used for the operation of the industrial park.

Once completed, the central and local governments will provide an additional 25% subsidy for fixed assets, bringing the actual cost to around 2.4 million yuan.

The budget of 50 billion is not enough, it's simply not enough!
Even if we expand to 15 large international warehouses, we still won't be able to use them!

Sure enough, seeing that the capital city was offering such good treatment and high subsidies, other cities went crazy and increased their offers as well.

Fixed asset subsidies are increased to 10%, interest subsidies are given at 2%, and tax rebates are not just 70%, but a whopping 90%!

Alternatively, you can get a full refund for the first three years, and a 70% refund after three years!

Basically, we've given them everything we could.

In a short time, the Future International Warehouse project was fully revitalized.

They're showered with preferential policies.

The locations offered by each city are excellent and negotiable.

It can be said that as long as future technology arrives, everything else will be fine.

In its previous life, JD.com built its No. 1 warehouse in Asia, which required JD.com to sell everything it owned and take out loans.

Wang Junshan operated in a completely evil manner throughout, never issuing a single coin.

The main reason is the precise timing and the operation of heretical practitioners.

Precisely aligned with the four trillion yuan stimulus package, the launch of ten international warehouses totaling 250 million square meters triggered a frenzy of investment from various regions, with governments contributing funds, land, and policy incentives.

The land was given away for free, and the bank loans completely covered the construction costs, with a surplus even after subsidies!
Then, a super order for 100,000 tons of steel was placed, which attracted more than a dozen steel mills to scramble for it.

When the economy is good, a purchase volume of 1 tons is considered a large customer.

Steel is not sand.

It's worth noting that developing a 150-acre residential area only requires 4000-6000 tons of steel.

One hundred thousand tons is enough to develop 20 residential communities!

In addition, the global economic crisis broke out in the fourth quarter of 2008, which drastically reduced the shipment volume of all steel products, resulting in huge inventory pressure.

Then Wang Junshan's mega-order of 100,000 tons is even more coveted.

Moreover, it's not ordinary steel used in home appliance factories, but rather higher-end structural steel.

Amid the frenzy, the price soared to 2800 yuan per ton.

Just outrageous!
All I can say is that the unorthodox methods are both fast and stable.

Of course, steel is only one example; other raw materials are also subject to the same method: unified bidding and price reduction.

This resulted in a further 9% discount on the already extremely low prices during the economic crisis!
Unfortunately, once the economic crisis broke out in September, very few projects started throughout the fourth quarter.

Many projects that had already started have been halted, leaving many unfinished projects.

Everyone is starving.

The same applies to the first quarter of next year.

The recovery will not begin until the second quarter of next year.

The real hottest period will be in the second half of next year.

Therefore, the prices of steel, cement, and labor will be at their lowest for the next six months.

It won't start to surge until May or June of next year, and it will continue to climb steadily in the second half of the year.

However, Wang Junshan did the opposite, finalizing the future international warehouse matter in November at the fastest speed.

Then we'll see how things go locally. If the procedures are completed by December, construction can begin in December.

If the process isn't completed by December, it will be in January of next year.

Steel structure warehouses can shorten the construction period by 30%, and can be completed within half a year.

In this way, by the time various materials and labor costs begin to rise in the second half of next year, a significant portion of the future international warehouse will already be completed.

Those projects that are not yet completed are basically nearing completion and will not be affected at all.

The fastest progress will be completed and put into use by the middle of next year.

With the explosive growth of various e-commerce businesses in the future, existing warehousing is becoming increasingly inadequate.

Even small items are not enough, let alone large appliances which have not yet seen a surge in demand.

Next year, the supply will be even more insufficient, and we urgently need more than a dozen large international warehouses to be put into operation quickly to solve the storage crisis.

If it cannot be put into use in time, more warehousing centers will have to be leased next year, and the leasing cost is not a small amount.

Of course, what if e-commerce companies can't use all of the dozen or so international warehouses in the future?
That's easy to explain.

They can be leased to third parties, other B2C e-commerce platforms, or C2C merchants.

In addition, logistics will also be launched simultaneously in the future.

In the future, it won't just be delivering e-commerce goods; it will also launch pickup and drop-off services to increase revenue.

Users who need to send packages can place an order directly via WeChat, and in the future, a logistics courier will pick up the package from their door and mail it.

That's right, it's the same model as JD Logistics in its previous life.

Logistics and warehousing are very expensive.

This is why JD Logistics has been losing money year after year, with its income not covering its expenses.

Finally, when Liu Qiangdong (Dong Ge) was desperate for money, he spun off JD Logistics and launched a parcel pickup and delivery service, which generated a lot of revenue.

Unfortunately, JD.com was too late; it only started its pilot program in 2017.

Wang Junshan, however, plans to launch his logistics service next year, immediately offering parcel pickup and drop-off services to third-party merchants and individuals.

The service will be launched simultaneously in all areas covered by future logistics.

After all, we've already set up international warehouses, established a logistics system, and trained delivery personnel. With so many expenses, it would be unreasonable not to make a single penny more!

Wang Junshan's principle is to operate with capital, minimize upfront investment, and maximize profits!
Seeing Wang Junshan's actions, JD.com was on high alert. Even Chairman Liu couldn't sit still:
“Vipshop first aggressively entered the 3C and home appliance sectors, breaking through JD.com’s core competitive advantage.”

"Now they're setting up ten more international warehouses, all for the sake of large appliances, for the very lifeblood of JD.com!"

Other senior executives largely agreed, and they all chimed in:
"That's right. Wang Junshan's move is not to kill Taobao, but to crush JD.com and challenge Amazon."

“Vipshop already has more users and more revenue than us. If we wait until all ten major international warehouses are in place, Vipshop will be able to achieve same-day delivery in more than a dozen cities and next-day delivery in nearby cities. Even for more distant cities, it will only take about three days.”

"This is very frightening."

"That's right. It takes JD.com about a week. If Vipshop can do it in three days, then JD.com is really doomed."

"But there's no other way. If we want to improve logistics efficiency, we can only do what Wang Junshan did: build warehouses like crazy all over the country."

“Wang Junshan can do this, but it will be difficult for us at JD.com to do it.”

"That's right, Wang Junshan's clever tactics can keep costs to a minimum."

"For example, if land is given away for free, 500 acres of land in a second-tier city can save 5000 million to 1 million yuan in costs."

"In first-tier cities, 400 acres can save 3-4 million yuan in costs!"

"What about JD.com? Which city would offer us a four or five hundred-acre industrial park?"

"Stop dreaming. This is the treatment given to big platforms. Vipshop has an annual transaction volume of over 10 billion yuan and a valuation of over 10 billion yuan, so it gets this treatment."

"But JD.com is different. Our annual transaction volume is only 13 billion yuan. That's at least ten times less."

“If we want to build an industrial park, the cost will be too high.”

Chairman Liu sighed, understanding the principle: "It is indeed high, but sometimes there's nothing we can do."

“If we build logistics parks, JD.com might survive; if we don’t, we’re doomed.”

"Chairman, if we really do it, the cost will be too high."

"Even though the cost is high, we still have to do it. The four trillion yuan stimulus package includes logistics infrastructure support, so we can learn from Wang Junshan's approach."

The subordinate shook his head: "Chairman, it's difficult!"

“The local government can indeed provide a loan of 4 million yuan for building a large logistics park, but with an interest rate of 5.94%, the interest over five years will be around 6000 million yuan.”

“Wang Junshan’s Vipshop is large-scale, with a 5% interest subsidy from the central and local governments, resulting in an interest rate of only 0.94%, which saves him 5000 million yuan in interest.”

“But JD.com is too small. It’s questionable whether we can even become a key logistics project. The interest subsidies from the central and local governments are probably less than half of what Wang Junshan received.”

"There is also a fixed asset return, and Wang Junshan can get the maximum of 25%, which will save another 8000 million to 1 million yuan."

"But it's tough for us at JD.com. We might not even be able to get the 15% subsidy."

“Wang Junshan can use his ten large warehouses to further reduce the cost of raw materials and other supplies, saving another 100 million yuan.”

"But JD.com doesn't have that capability."

"Based on this calculation, Wang Junshan's actual expenditure for a 500-600 mu logistics park in a second-tier city, plus five years of loan interest, is only about 2.5 million yuan."

"But we at JD.com can't do that; we'd have to pay at least twice the price!"

Upon hearing this, Chairman Liu fell silent.

JD.com is too small now, with an annual transaction volume of only 13 billion yuan, which is insufficient to cover its expenses. It simply does not have the funds or the influence to build such a large logistics park.

The total area of ​​the warehousing centers currently established in Beijing, Shanghai and Guangzhou is only 5 square meters!

Even if they were to go all in and build a large-scale logistics park, they couldn't do what Vipshop did: get land for free, the highest interest subsidies, and the best deals from local governments.

In its previous life, JD.com acquired 200 acres of land in the Yizhuang Economic and Technological Development Zone of Beijing in 2009 to build the North China Logistics Center. The land price was 80 yuan per acre, and the company spent 1.6 million yuan in total!
The area is only half that of Wangjunshan's Imperial Capital International Warehouse, but JD.com's cost exceeds 6 million yuan, twice that of Wangjunshan.

Mr. Liu had no complaints about this.

For other industrial parks, Wang Junshan delegated the raw material negotiations to his team.

He, on the other hand, returned to Binhai City.

"How does it feel to be back in Binhai?" Wang Junshan asked with a smile.

"It feels so good, like coming home!" Shen Huaijin exclaimed with deep emotion. "I never thought I'd be gone for so long."

"More than two months have passed quietly. When I left, it was still short sleeves and air conditioning, and when I came back it was long sleeves and late autumn."

Looking at the maple leaves in Yishan Yunzhu, Wang Junshan smiled and said, "However, our journey to the capital for the imperial examination was very successful."

"Yes, it's much more successful than expected. Boss, you're amazing! You're fantastic!"

Shen Huaijin gave a thumbs-up and looked into Wang Junshan's eyes, which were sparkling.

In early September, she went to the capital with Wang Junshan to take the imperial examination, and Vipshop was launched.

Now, in mid-November, I have once again followed Wang Junshan back to Binhai City and back to Yishan Yunzhu.

Although it has only been two months, so much has happened!
First, Vipshop launched a strong online campaign with brand sales, achieving 6000 million yuan in sales on its first day.

The industry is shocked: Vipshop, which just launched, has seen its valuation soar to 10 billion!
Tencent has invested, and Alibaba has also made a strong move.

But fate played a cruel trick on them.

Alibaba's people were at the door, and Tencent's people were at the airport, but Lehman Brothers went bankrupt.

The global financial crisis has broken out!
BAT (Baidu, Alibaba, Tencent) have all had to scale back, abandon investments, and prepare for a downturn.

At this point, everyone thought Vipshop was doomed.

Unexpectedly, amid the global financial crisis, Vipshop's brand flash sales not only did not decline, but instead grew stronger by leveraging big brand discounts and the user growth of "WeChat Farm"!

Paipai.com subsequently implemented a blanket ban, effectively cutting off its own operations and forcing away a large number of sellers and users. This led to a decline in revenue for brand merchants, who then switched to Vipshop.

With this support, Vipshop rose to prominence and grew bigger and bigger.

With the support of WeChat spokesperson Hu Xiaoyao and extensive advertising on major portal websites and other platforms, WeChat users grew, and Vipshop's users and revenue also surged.

Not only do they excel in clothing, cosmetics, and bags, but they have also broken through JD.com's competitive advantage in 3C products and large home appliances, taking it a step further.

In addition, the investment of 50 billion yuan to build ten international warehouses has made Vipshop the number one B2C platform in the minds of consumers!

Although there is no official certification, many consumers believe this.

A true uncrowned king!
The massive infrastructure projects in the ten major warehouses have been widely reported by the four major portal websites and online media.

Even major satellite TV stations, television stations, and provincial and municipal media outlets rushed to report on it.

For example, the signing of a 400-acre logistics park in Shunyi with the capital a couple of days ago was reported on the news by Beijing TV that evening!
The following day, multiple media outlets in Beijing also gave it extensive coverage, making it the front page headline.

As a result, users in Beijing who had never heard of Future Tech or Vipshop before started downloading WeChat and shopping on Vipshop!
And Beijing TV is just a microcosm.

Other TV stations and media outlets also gave concentrated coverage to the 5 billion yuan investment to build ten major international warehouses.

This has made Future Tech, WeChat, Vipshop, and YouTuan.com household names, leading to a surge in users.

As a result, WeChat's user base surpassed 8000 million on the 17th!
Vipshop's user base has also exceeded 4000 million.

This is why Vipshop's daily revenue has surged again recently.

In the days immediately following the exposure, Vipshop's daily transaction volume surged to 8000 million, and even 1 million.

It has decreased somewhat, but it remains stable at around 6000 million!
This is exactly the record for the first sale!
However, this has become the norm now!
"Boss, do you think Tencent will regret this?"

Shen Huaijin suddenly spoke up: "We had already arrived at the airport, ready to invest 20 billion yuan in Vipshop and acquire a 20% stake. But unexpectedly, the financial crisis broke out, and we had to give up."

"If we want to invest again now, the valuation won't be 100 billion anymore; it will be at least 200 billion, or even more!"

(End of this chapter)