Rebirth in Hong Kong: From Dessert Shop to Industrial Empire.

Chapter 246 Convenience Store 4K (Seeking monthly tickets, recommendations, and subscriptions!)

The deeper reason why Chen Bingwen was so eager to push forward the groundbreaking ceremony of the Hung Hom Industrial Park was that he needed to find a new value anchor for Qingzhou Yingni.

Selling the cement business to China Resources brought in a huge amount of cash, but it also meant that Qingzhou Yingni lost a mature business that consistently generated stable cash flow.

The capital market is realistic. If a listed company sells its core assets without a clear and more imaginative investment plan or growth story, its stock price is likely to fall quickly after a brief surge.

The perfect story is a "modern beverage and food industrial park" project with a total investment of hundreds of millions of Hong Kong dollars.

It can not only effectively absorb the funds obtained from the sale, but also clearly send a signal to the market that Qingzhou Yingni is not shrinking, but transforming and upgrading, from a traditional cement producer to a food real estate development and operation platform with more technological content and growth potential.

This story is enough to support or even boost the stock price, maintaining the company's market value and financing capabilities.

In addition, Chen Bingwen had an even more important plan in mind.

As the controlling shareholder, although he has the power to control that money, it is, after all, the money of a listed company, and its use must be in the interests of all shareholders and the procedures must be compliant.

Therefore, the 6% stake in Hutchison Whampoa that he acquired from Wayne Goulburn was acquired and held under the name of Qingzhou Yingni.

On the one hand, holding shares in high-quality blue-chip stocks like Hutchison Whampoa can immediately improve the asset quality and valuation of Qingzhou Yingni, and its dividend income can also partially make up for the profit gap after the sale of the cement business, perfectly hedging against the possible valuation decline.

On the other hand, it used the money from the listed company to acquire key strategic assets, indirectly enhancing its bargaining power in the battle for Hutchison Whampoa, while also alleviating direct pressure on its cash flow.

Meanwhile, under Ma Shimin's management, Watsons transformed its 72 stores in just two months.

The store image has been unified and upgraded, the product structure has been adjusted, and more imported beauty and personal care products have been introduced, resulting in a significant increase in sales and average order value.

With internal management streamlined and sales performance steadily increasing, Ma Shimin is preparing to accelerate the expansion of chain stores.

He came to Chen Bingwen with the project proposal.

"Mr. Chen, this is the next expansion plan."

After placing the documents on the table, Ma Shimin reported to his supervisor: "There are still four prime locations in the core business districts of Hong Kong Island and Kowloon that we can acquire."

In Singapore, I've also identified two prime locations that I can rent first, serving as a bridgehead for entering Southeast Asia.

I plan to expand the total number of Watsons stores to two hundred within two years!

Chen Bingwen quickly browsed through the plan.

Ma Shimin's plan is very solid, with the budget, payback period, and risk assessment all clearly outlined.

"Okay, proceed according to your plan." Chen Bingwen nodded in approval.

"In addition," Chen Bingwen added, "the expansion speed must be well controlled, and cash flow cannot be too tight."

Before a new store opens, the supply chain and staff training must be in place; Watsons' reputation cannot be ruined.

"Don't worry, Mr. Chen, I know what I'm doing." Ma Shimin smiled confidently.

He likes the feeling of being fully empowered and receiving clear support.

"Mr. Chen, in addition to the existing expansion plans, I recently discovered a new opportunity while researching the overseas retail market."

Ma Shimin placed a briefing on 7-Eleven convenience stores in the United States in front of Chen Bingwen.

"This 24-hour convenience store model has developed rapidly in Japan and the United States."

I've done my research and I think this model has great potential in Hong Kong Island as well.

Hong Kong Island is densely populated and has an increasingly fast pace of life, with many people working and having fun at night.

Traditional grocery stores and markets close at night, leaving a market gap.

If we can introduce 7-Eleven's franchise rights, or learn from its model, and open chain convenience stores on Hong Kong Island, we can not only sell our beverages and snacks, but also add high-margin products such as cigarettes, newspapers, cooked food, and ready-to-eat products. This will greatly consolidate our retail base on Hong Kong Island and form a dense terminal network.

Chen Bingwen listened attentively to Ma Shimin's advice.

From a business perspective, Ma Shimin's suggestion is very forward-thinking, even ahead of its time.

Because he knew that Ma Shimin was right, and that this model would shine brightly in the coming decades.

but.

Does the Hong Kong Island market have potential at this time?

there must be.

With the development of Hong Kong Island's economy, citizens' nightlife has become more diverse, and there is indeed a gap in demand for nighttime shopping.

Being the first to try something new may give you a first-mover advantage.

But what about the risks?

It can be said to be very large.

First, there's the issue of security. In 79, the safety risks of operating businesses at night were not to be underestimated. The safety of shop staff and the safety of goods were major concerns.

Secondly, there's the issue of manpower. Before the unmanned systems of later generations, 24-hour operation meant three shifts, resulting in high labor costs and significant management difficulties.

Furthermore, 7-Eleven convenience stores typically carry dozens or even hundreds of different products; can the supply chain support this high frequency of transactions?

Small-batch nighttime delivery?

Relying solely on Chen Ji's current logistics system would likely be insufficient.

Most importantly, it takes a long time to cultivate consumer habits, and there is a high possibility of significant losses in the early stages.

Moreover, Chen Bingwen had a much bigger plan in mind.

While the 7-Eleven model is good, it is a retail format that is asset-heavy and requires strong operations, demanding a great deal of effort to refine the supply chain and management details.

His core strategy is brand production and operation and capital operation, which is to capture users' minds through products like "Pulse" and build a business empire by holding shares in high-quality assets.

Diverting his energy to cultivate a completely new convenience store format that doesn't synergize well with his existing main business might disrupt his rhythm.

"Your idea is excellent; the 7-Eleven model certainly represents the future direction of development."

Chen Bingwen first affirmed Ma Shimin's suggestion, then put down the briefing, carefully considered his words, and said, "However, at this stage, it is not advisable for us to directly enter this field."

Ma Shimin was taken aback, somewhat surprised.

After all, given Chan Kee's current model, if 7-Eleven convenience stores could be introduced to Hong Kong Island, it would create a perfect closed loop of production, supply, and distribution channels.

Chen Ji's core advantage lies in its products.

But even the best products need strong distribution channels to sell them.

Watsons is positioned in the mid-to-high-end personal care market, with limited outlet density and purchase frequency.

If a high-density, high-frequency convenience store network similar to 7-Eleven can be established on Hong Kong Island, then the sales terminals in the local market can be firmly controlled.

This not only provides the most stable distribution channels for its own products, forming a closed loop of "production-brand-channel" and greatly enhancing its ability to resist risks, but also effectively prevents other competitors from building a solid channel moat.

When researching overseas markets, Ma Shimin keenly noticed the rising trend of the convenience store format.

He judged that this model would eventually be adopted by Hong Kong Island, one of Asia's most developed cities.

Instead of waiting for foreign brands or other large local conglomerates to introduce the technology and seize the initiative, it is better to take the lead in setting up our own market, filling market gaps, and becoming a rule-maker rather than a follower.

He made this suggestion out of a strategic mindset of preemptively securing a position.

However, as the helmsman, Chen Bingwen needs to weigh the overall strategic focus, resource allocation, risk appetite, and return on capital of Chen Ji Group.

Even if the 7-Eleven model is good, the huge initial investment, deviation from the core strategy, dispersion of management energy, and higher opportunity cost at the current stage are all important factors that Chen Bingwen rejected.

However, in order not to dampen the enthusiasm of his subordinates, Chen Bingwen patiently explained: "There are several reasons for this."

First, introducing 7-Eleven convenience stores now is too risky.

Security, manpower, and supply chain are all real challenges. If we enter the market now, we will have to bear the costs and risks of cultivating the market on our own.

Perhaps waiting a year or two, when the market is more mature, or when other pioneers help us test and explore, before entering with a more optimized model, would be a more prudent choice.

Secondly, Watsons' core business is personal beauty products, which are positioned in the mid-to-high-end market. This is different from 7-Eleven's daily and convenient positioning. Blindly expanding may blur the brand image.

Third, and most importantly, we need to focus our funds and management efforts.

The Pulse series is at a critical juncture in its global expansion, and the situation with Hutchison Whampoa has also reached a critical point; we cannot afford to open a new front that requires heavy investment.

Ma Shimin was a smart man and immediately understood Chen Bingwen's overall strategic considerations and concerns.

"Understood, Mr. Chen. I will focus on executing the existing Watsons expansion plan effectively," Ma Shimin replied briskly.

"Yes, Watsons' current task is to deepen its presence in Hong Kong and Macau, steadily expand into Southeast Asia, and thoroughly establish its position as a professional retailer of health and beauty."

The idea of ​​convenience stores is good; it can be studied as a long-term project to collect data and observe market dynamics, but we won't put it into action for now.

Chen Bingwen nodded and gave the instructions again.

After Ma Shimin left, Chen Bingwen leaned back in his chair and rubbed his temples.

He did not regret rejecting the 7-Eleven plan; for a company's development, strategic focus is crucial.

However, he also knew that Ma Shimin's idea of ​​controlling the terminal channels still had some value, and perhaps when the time was right in the future, it could be achieved in another way.

Just then, his secretary, Ali, reported to him via the internal phone that the people sent to the mainland to investigate the education situation had returned.

"Please let him in." Chen Bingwen sat up straight.

A short while later, a man in his thirties, wearing glasses and looking quite capable, walked in. He was a manager surnamed Lin under Fang Wenshan. He was reliable and fluent in both Cantonese and Mandarin.

"Mr. Chen." Although Lin Zhiwei looked travel-worn, his eyes were bright and his expression was excited.

The first thing he did upon meeting Chen Bingwen was to hand him a thick report.

"The preliminary investigations in Shunde and Chaozhou have been completed. This is the detailed report."

"Thank you for your hard work. Sit down and let me briefly explain the situation." Chen Bingwen gestured for Lin Zhiwei to sit down, while he quickly flipped through the photos and data in the report.

"Mr. Chen, following your instructions, I visited several towns in Chaozhou and Shunde and inspected more than a dozen primary and secondary schools."

To be honest, the reality is... a bit tougher than I imagined.

Lin Zhiwei organized his thoughts and reported in a low voice, "Many school buildings in the countryside are converted from ancestral halls or brigade headquarters built in the 1950s or 1960s or even earlier."

Most of them are brick and wood structures, and cracked walls and leaky roofs are common problems.

The windows had no glass; they were blocked by wooden boards or newspapers.

The desks and chairs were old and worn out, so many children had to bring their own stools from home.

He pointed to several black and white photos in the report: "Look, this is a primary school in Lecong, Shunde. The playground is just a muddy field, and it's impossible to play on rainy days."

Many schools don't even have decent toilets.

Chen Bingwen looked at the children's clear yet slightly timid eyes in the photo, and the mottled wall behind them, and remained silent for a moment.

These images were more impactful than he had imagined.

He was born in an era of great material abundance in his previous life. Although he had heard that conditions were harsh, what he saw with his own eyes was still very different.

"What about the teaching staff?" he pressed. "The teaching staff is very weak."

Lin Zhiwei sighed, "There is a serious shortage of public school teachers, and we rely heavily on private school teachers and substitute teachers."

These teachers are paid very little, only a few yuan a month. Many teachers have to farm in addition to teaching in order to support their families.

The teaching quality varies greatly, with many teachers themselves only having a junior high school education.

Moreover, the dropout rate is not low, especially for girls. Families facing financial difficulties or those who believe education is useless often prevent them from continuing their studies.

Chen Bingwen tapped his fingers on the photo.

The situation is indeed very bad, but it means that his money can be used effectively and make a real difference.

"What was the local government's reaction after you arrived?"

This is another key point of concern for him.

Even when doing good deeds, it's important to do them smoothly.

Without the support of the local government, things will be hampered in various ways.

As he said this, Lin Zhiwei smiled and said, "They are very enthusiastic. As soon as we explained our purpose, that Hong Kong businessmen Chen Guofu and Wang Qiaozhen wanted to give back to their hometown and donate money to support education, the leaders of the county and town attached great importance to it."

They accompanied me throughout the journey and were always there to help me.

They really need funds to improve educational conditions, which would be a real achievement for them and would also alleviate a lot of financial pressure.

They stated that as long as the funding is in place, land, approvals, and construction teams are not problems; they will fully cooperate to ensure the new school buildings are constructed as quickly and with the highest quality.

"Did they make any other requests? Like hoping we would invest in setting up a factory?" Chen Bingwen pressed.

"I did mention it, indirectly," Lin Zhiwei said truthfully. "But I strictly followed your instructions and only talked about educational donations, clearly stating that we currently have no other investment plans."

While they expressed some regret, they also expressed understanding, and the discussion mainly focused on the specific plan for donating money to build the school.

"Very good." Chen Bingwen nodded in satisfaction.

Donating to build schools is a timely help, which is naturally welcomed by the recipient. Moreover, it is a purely charitable act that does not involve complicated commercial interests, so it faces the least resistance and has the best reputation.

He closed the report and made a decision: "Manager Lin, you did a great job."

Next, you will work with Director Fang to develop a detailed donation and construction plan based on this report as soon as possible.

The first batch of projects will focus on rebuilding or repairing approximately ten central primary schools in Shunde and Chaozhou, which are in the most urgent need of reconstruction.

The standards should be higher; classrooms should be bright and sturdy, and basic facilities such as playgrounds, libraries, and toilets should be provided.

At the same time, an education fund will be established, mainly for three purposes: first, to subsidize tuition and lunch for impoverished students;

Second, award bonuses to outstanding teachers and living allowances for private school teachers:

Third, regularly purchase books and teaching equipment.

He paused, then added, "The operation of the foundation must be transparent to ensure that every penny is spent on the children and teachers. If there is no suitable third-party oversight body, we will manage it ourselves first."

"Understood, Mr. Chen! I'll take care of it right away!"

Lin Zhiwei appeared somewhat excited.

He felt honored to be able to participate in such a truly good thing.

"Okay, go ahead. Give me the plan as soon as possible." Chen Bingwen nodded.

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