Road to Revival

When Lü Qi entered, the report had already reached Jiang Yansheng's production line. She hadn't heard the earlier parts, but she had heard the later ones. After the report ended, when Han Zhiyong asked if anyone had anything to add, she raised her hand and said, "I don't know if the project funding was discussed... there are some issues with that..."

Before arriving, Lü Qi was discussing the misappropriation of project funds with Duan Hui. They knew about today's meeting but weren't qualified to attend. So Lü Qi brought up the project issue, and immediately regretted it, because she understood the look Liu Xinjun was giving her.

Liu Xinjun didn't mention project funding earlier. Hongxing Company currently has many projects under construction, including three large projects funded by the state, but with a self-financing rate ranging from 30% to 35%. A special technical upgrade project for a gearbox production line, scheduled for acceptance by higher authorities by the end of this year, has already been severely delayed, mainly due to funding constraints. Additionally, there's the issue of misappropriated project funds, which the headquarters audit team has likely uncovered, and the shortfall must now be covered. Furthermore, there are several smaller projects that are self-funded by the company, including the Ancuo plan implemented after Tao Tang took office.

"Let's not talk about that for now..." Han Zhiyong glanced at Liu Xinjun, understanding that Liu Xinjun wasn't unaware, but rather intentionally avoiding the issue. He, Han Zhiyong, was directly responsible for the embezzlement, but he believed he had a clear conscience.

Tao Tang disagreed. "Why not talk about it? Hmm? Before I came, Chairman Feng and General Manager Qi both mentioned the company's project construction, which is crucial to Hongxing's future development, and headquarters attaches great importance to it. They instructed me to pay special attention to this. I originally wanted to arrange time to listen to the Development Planning Department's report, but I haven't had the time. Let's talk about it now. Comrade Lü Qi's reminder is very true. Assistant Liu, can you explain it clearly?"

"I know the general situation," Liu Xinjun said, feeling extremely passive. He was deeply dissatisfied with Lü Qi, but he dared not show it now, or even later... He glanced at his superior, Luo Chong, and seeing that Luo Chong showed no reaction, he could only bite the bullet and say, "This part is under the jurisdiction of Comrade Duan Hui, so he knows it quite well... By the end of the year, the company will be carrying out seven technical upgrade projects, three major and four minor, requiring a total of 2.57 million yuan. Because the gearbox project needs to be ready for acceptance by the end of the year, from May to October, a total of 6500 million yuan needs to be invested. Since the national allocation has been spent in advance, this part needs to be raised by ourselves. According to the investment plan approved by our department, no less than 2000 million yuan should be invested in May... Including the needs of the other projects, at least 3500 million yuan needs to be invested in technical upgrades in May."

"At least? From what you're saying, you mean the government-allocated funds were misappropriated, right?"

"President Tao, the misappropriation did occur. There are meeting minutes. The responsibility does not lie with the Development and Planning Department." Han Zhiyong and Liu Xinjun had a good relationship, and Han Zhiyong did not want Liu Xinjun to bear too much pressure.

"The responsibility doesn't lie with the Development and Planning Department... Where does it lie? What about the Ancuo Plan? Is it going to be shelved again?" Tao Tang clearly expressed his dissatisfaction with Liu Xinjun.

Perhaps because Ancuo had limited funds, Liu Xinjun had completely forgotten about this project. Zhao Qingmin sighed inwardly, thinking to himself, "This was the first project Tao Tang took on after taking office. How could he forget it? This Liu Xinjun has been distracted ever since Song Yue's incident."

"I'm sorry, that's not what I meant..." Liu Xinjun hurriedly explained, "Because the budget for the Ninth Factory's safety measures plan isn't very large, so..."

"Only the Ninth Plant was designed for safety measures?" Tao Tang was displeased. "During the first general manager's office meeting, you told me that this year's safety measures plan was worth tens of millions, and the dust removal upgrade at the Ninth Plant was just one part of it. Besides, is 300 million a small amount in your eyes?"

"President Tao..." Liu Xinjun was once Song Yue's most trusted cadre, otherwise he wouldn't be sitting in the position of director of the Development and Planning Department, let alone being publicly reprimanded by the top leader. He wanted to explain, but didn't know where to start, feeling extremely embarrassed.

"Alright, stop explaining." Tao Tang rubbed his face. "The situation is roughly clear now. The imports are 4 million, and that's after President Li put pressure on the marketing department. As for exports, all things considered, it exceeds 7 million! How are we going to manage this? Let's all discuss it."

This is the benefit of a financial balancing meeting. The accounts are laid out, which also silences everyone. Not a single item on the list is unnecessary. Which expense is unacceptable? Should salaries not be paid? Should taxes not be paid? Should materials not be purchased? Projects and research cannot be stopped.

Seeing the meeting getting a bit awkward, Zhao Qingmin said, "The situation is indeed very serious. We need to work together to solve these difficulties; we can't just put all the blame on General Manager Tao. General Manager Han, you're in charge of the money, so you go first."

"To be honest, there are many omissions, such as the water resources fee. The Water Resources Bureau has been urging us for a long time and has threatened to issue fines several times. There are definitely problems like the coal payment issue from last time. The figures reported by the Finance Department, the General Manager's Office, and the Legal Office are a conservative estimate; the actual situation is certainly more serious... President Tao and Secretary Zhao asked me to speak, so I'll share my opinion. First, I want to thank President Tao for holding this meeting. Why? I think it's support for my work. Many leaders and departments blame the finance department, but now everyone sees that a meal has been prepared, and they've come..." Two tables of guests, how should we arrange it? I think it's nothing more than cutting costs and increasing revenue; I can't think of a more ingenious solution. First, I'd like to ask Mr. Li to put more pressure on the marketing department. 4 million is simply not enough. Mr. Li, you see, which part can we avoid paying? Currently, the outstanding debt is as high as 9 million. After deducting the more than 2 million within the system, there are still more than 7 million scattered across various markets… I really can't mention the specific figures. I do hope to recover nearly 1 billion in funds by May, but that's asking too much, impossible. But we can take some… Is it possible to increase revenue by 10 million through unconventional means? Secondly, we need to cut costs. First, regarding procurement, An Zhongliang, you can't ask for an exorbitant amount. Nearly 4 million for materials is unrealistic. People owe us; why can't we owe them? 4 million won't do, 3 million won't do either, 2.5 million at most! We also need to ensure uninterrupted production! The same applies to outsourcing payments; reduce them by 1 million from the initial 3000 million. Jiang Yansheng, you need to give General Manager Tao a firm commitment; you can't let 3000 million cause a setback. As for the rest, I think... Aside from projects and research, which cannot be compromised, all other expenses must be drastically reduced. For example, regarding funds handled by the legal department, we can negotiate with creditors and the court to extend the payment deadline. The total payment amount for May should be cut by two-thirds! We can't let all the historical issues pile up and be dealt with by Mr. Tao all at once! I also want to mention that May's salaries aren't high because our targets for April were poorly met. If May's plan is successfully completed, June's salaries will increase by at least 500 million. Mr. Tao, that's all for now.”

"President Tao, let me say a few words." Li Luo had to fight back. "President Han's suggestion is absolutely correct. Increasing revenue and reducing expenditure are always the right things to do, but getting payments back isn't something you can just take for granted! If allowed, I can go over the contracts item by item. The marketing department's plan to come up with 3.75 million is based on evidence; the 4 million I've put on them is already the limit. Yes, there are indeed nearly 1 billion in outstanding debts, but the responsibility for not being able to collect that money doesn't lie with me, much less the marketing department! Everyone knows that whether it's mining machines, agricultural machinery, or vehicle parts, the reality is that there's always a need for a return on investment." "Payment cycle. There's nothing we can do about it; N+2 is the norm now, Mr. Han, aren't you aware? You just dumped a 10 million yuan target on me, what's the basis for that? Yes, Mr. Tao just arrived, and we all have a responsibility to support his work, but you can't be so unrealistic. Besides, the financial strain isn't just due to outstanding debts, is it? Why don't you mention the over 10 billion yuan in inventory? And the persistently high warranty and repair costs—in April alone, warranty losses exceeded 1500 million yuan. This responsibility can't be borne by the marketing department, can it? Increasing revenue is good, but in reality, cutting costs is the key."

Lu Qi immediately felt a headache coming on; she was worried for Tao Tang. It was common knowledge that Han Zhiyong and Li Luo didn't get along, and now Han Zhiyong was pressuring Li Luo, while Li Luo was criticizing Han Zhiyong and Ma Guangming, which was definitely putting Tao Tang in a difficult position.

Fortunately, Tao Tang raised his hand to stop Han Zhiyong from speaking, but Luo Chong raised his hand, and Tao Tang nodded, "President Luo, please speak."

"I basically agree with General Manager Han's opinion. Of course, the specific situation needs to be studied, such as the marketing department's payment collection. General Manager Li's opinion is also valid. All marketing contracts have passed through my hands, and delayed payment has become an open secret; otherwise, we wouldn't be able to get the contracts. Under the current circumstances, the larger the company's marketing scale, the more outstanding payments will be—this is unavoidable. Because we are mostly supplying other companies. But we do have downstream suppliers; why can't we hold onto their payments? That's the problem. The potential in agricultural machinery is huge, and the current supply model is unsuitable. We can't afford to be taken advantage of upstream and then have to come back down." "Then we'll be squeezed by downstream customers again. So we need to redo our procurement and production funding plans. Also, payments arising from legal disputes might not be so easy to coordinate. The courts aren't our private property; they're not so easy to deal with. What if the court freezes our accounts if we don't comply with the settlement agreement? Wouldn't that be even worse? I'm not saying we can't do our work, but we can't arbitrarily set targets like two-thirds. As for the inventory issue Mr. Li mentioned, it definitely needs to be considered. That's all money. If we can reduce it by half, Mr. Tao won't be in such a difficult position..." After Luo Chong finished speaking, he took off his glasses and carefully wiped his face with tissues from the tissue box on the table.

Han Zhiyong was furious that Luo Chong had sided with Li Luo. Just as he was about to speak, Tao Tang interjected, "What the leaders said earlier was quite good. President Ma, you're in charge of production and outsourcing, what do you have to say?"

"I basically agree with President Han's opinion. Under these circumstances, this is the only way. I'll make a statement: I'll try my best to reduce funds in this area, but the specific amount needs to be calculated carefully." Ma Guangming naturally wanted to sit with Han Zhiyong.

"Mr. Qiu?" Tao Tang looked at Qiu Lin. "Your piece is also a big deal, what do you think?"

"President Tao, it's not that the purchasing department doesn't understand the company's difficulties. It's just that years of purchasing on credit have caused us a lot of trouble. The prices are high, the quality is poor, and it's easy to cause legal disputes. Since the funding gap is so large, I want to make a statement: let's do our best to reduce the purchasing funds. If it can be done on credit, we'll continue to do so... I have a suggestion: let's do a clearance sale. The various branch factories have a lot of stockpiled materials. If we can make use of them, I think saving 5000 million yuan won't be a problem at all."

"General Manager Jiang?" Tao Tang looked at Jiang Shangyun.

"I don't have much to say. The leaders have already given some very good suggestions. Under the current circumstances, perhaps the only thing we can do is focus on increasing revenue and reducing expenditure. What I want to say is that this situation cannot be sustained indefinitely," Jiang Shangyun, whose hair was mostly white, raised his voice. "If it weren't for President Tao bringing in a 100 million yuan working capital loan, and if it weren't for President Tao getting 200 million yuan in advance from headquarters regarding internal debt, the unpaid wages for employees would never have been resolved. The massive production surge in May would have been impossible! I just estimated that with the arrival of the production peak, material costs, wages, and power costs will all increase rigidly, and President Li's current payment system will inevitably lead to an increase in debt. At the most optimistic rate, it will take at least three months to turn things around. What will we do during these three months? Continue applying for loans? Let's not even talk about whether we can get the loans at all, even if we do, what about the interest? Current loan interest rates are always above 6%, right? At least 6 million yuan of 100 million yuan will go into interest. Can we even earn 6 million yuan in net profit? I'm not sure. Wouldn't that just be working for the bank?"

Han Zhiyong interrupted Jiang Shangyun, "President Jiang, everyone understands these principles, so please don't repeat them. The issue now is to come up with concrete measures to solve the problem."

"Measures? The primary measure is to increase revenue, not to cut costs. Which of the items that everyone just listed shouldn't have been spent? Saving money now is just sowing the seeds for even greater bitterness later." Jiang Shangyun seemed dissatisfied with Han Zhiyong interrupting his speech.

"Then what do you suggest? Give me some suggestions." Han Zhiyong said impatiently.

"My opinion? My opinion has been rejected by you multiple times! The 1100 million yuan project that Li Meng just presented was the result of my drastic cuts! If we consider actual needs and the outstanding debts, that figure should more than double! Thank you, President Tao, for understanding the significance of scientific research and for protecting this project without hesitation. If you had done this earlier, the company wouldn't be in this situation!"

In fact, Tao Tang did not "protect" scientific research, but Jiang Shangyun held Tao Tang responsible, which shows the deep resentment the chief engineer had towards Han Zhiyong, who controlled the finances.

"Alright, let me say a few words," Tao Tang once again cut off Han Zhiyong's counterattack.