Road to Revival

"You agreed?"

"I've agreed. I'll give them that much face."

"You seem to value this person a lot?"

"It's unavoidable. Besides, we were indeed classmates. Back then... You prepare carefully, tentatively set for Saturday night."

"Can the number and identities of the guests be confirmed?"

"The banquet will be held here, but all the entertainment facilities need to be prepared. I don't know what he likes... As for the number of people, it won't exceed five. They will all be classmates, regardless of their status."

"Understood. Is there anything else you need, Mr. Tang?"

"That's all... I'm going back now, you should go home too."

Tang Yikun, Chairman of the Board of Directors of Donghu Industrial Group, watched as Qi Ping, the graceful manager of Donghu Club, left his private room. He noticed her disappointment, but he remained unmoved. He now believed that the decision he had made was correct. He had once considered taking this beautiful and capable female manager of the Sheng Tang Club into bed, but after a two-month trial period, her abilities and performance dispelled his fantasies. He liked beautiful and alluring women, but many years ago he had set a strict rule for himself: never to develop a mistress among his female subordinates.

The club has been in operation for more than four years. Of the three club managers he hired, Qi Ping, who did not have a formal education, was the most outstanding. Since she took office, the club's management has improved significantly, and profits have increased by 20% year-on-year, further consolidating Donghu Club's leading position in Pingquan's catering and entertainment industry. He fully acknowledged that all of this was due to Qi Ping's achievements.

He had once been captivated by her mature charm, and she had unintentionally hinted at something in return, which he could clearly sense. Compared to younger beauties, he appreciated mature charm more. It's like ordering food at a restaurant; different people always have different tastes. In recent years, with the successful listing of Donghu Real Estate, he had changed his old ways, becoming more discerning and cautious in his pursuit of women. He didn't believe in so-called love; love might exist, but it certainly didn't exist between him and his women, including his wife.

His relationship with them was purely based on self-interest. Including Qi Ping, who had just left.

Tang Yikun pressed the doorbell under his desk, and his driver and bodyguard, Ma Lin, silently entered. Tang Yikun stood up and walked out, handing his handbag to Ma Lin. The latter turned off the light, locked the heavy oak door of the private room, and then hurried ahead of his boss. By the time Tang Yikun was outside the club, Ma Lin had already parked his sleek black Mulsanne at the bottom of the steps. Seeing his boss come out, Ma Lin quickly ran over, opened the back door, and "protected" his boss into the extremely spacious and luxurious car.

"Go home..." Tang Yikun mumbled out the two words.

Marin understood the precise meaning of "going home." In fact, Tang Yikun had three permanent homes in Pingquan City. Besides the Jinxiuyuan residential complex where his first wife lived, there were two other residences occupied by Tang's women, one of whom had given birth to his son, who was already three years old. But "going home" only referred to the old-looking villa in Jinxiuyuan, not any other place.

A Bentley Mulsanne with license plate GD88888, like a massive warship, cleaved through the sparse traffic of the night. Tang Yikun stared blankly at the bustling street scene, his face expressionless. It was now eleven o'clock at night. Zhenwu Road, which had been noisy all day, was now wide and quiet. The newly installed streetlights and huge neon signs on both sides of the road still illuminated the street as bright as day, and the shop windows still reflected the chaotic figures of people. The city had not yet fallen asleep. In Tang Yikun's eyes, Pingquan City was becoming more and more beautiful.

A group of young men and women, laughing and joking, crossed the road from the McDonald's flagship store at the Renmin Road intersection, causing Marin to slam on the brakes. He then rolled down his window and unleashed a few vicious curses. Seemingly hearing Marin's curses, the students pointed at the departing Musang and shouted something.

"Slow down..." he muttered.

"Yes, boss." Marin slowed down the car.

Marin, a former soldier, has been Tang Yikun's personal driver and bodyguard for almost three years. He knows his boss has been a bit troubled lately.

Luo Shaoxing is a complete scoundrel! I don't know what Boss Tang saw in him. With his meager abilities, why is he sitting in the position of Security Manager at Donghu Real Estate, earning an annual salary of 80 yuan? He's utterly useless and only causes trouble. Look, he's caused trouble for the boss again! After the shantytown redevelopment on Huajin Road, a modern residential area is going to be built. The name has already been chosen, even endorsed by Vice Mayor Zhou: Donghu Hanlin—such a poetic name! The demolition work has already been handed over to Deng the Bald's demolition company. What was Luo Shaoxing doing getting involved? Now look what happened! Someone died, and even Secretary Wang of the Municipal Party Committee has been alerted. How much money would it cost to completely shift the blame to Deng the Bald? It was easier to handle in the past, but the situation is different now. It might even drag Boss Tang into it!

Looking in the rearview mirror, I saw Boss Tang dozing with his eyes closed.

Tang Yikun was indeed somewhat troubled, but not because of the Huajin Road demolition issue. He officially "went into business" at eighteen and, over twenty-five years, built a formidable conglomerate. He didn't rely on his family's legacy, but rather on his extraordinary intuition and masterful business acumen. His favorite book was the series "The Red-Capped Merchant," which depicted the late Qing Dynasty tycoon Hu Xueyan; his idol was none other than Hu Xueyan, who held the second-rank official hat. For private enterprises to survive and thrive, they couldn't do without the support of the government.

Few people know that beneath Donghu Industrial Group's glamorous and imposing exterior lie numerous hidden worries. Leaving aside the internal strife stemming from Donghu Real Estate's listing, the key issue is that the group's development has encountered a bottleneck. Although Donghu bears the name of an industrial group, only two pillars support this diversified conglomerate: the mining company that laid the foundation for Donghu Industrial, and Donghu Real Estate, which has now replaced mining as the group's cash cow. The remaining industries and products number no fewer than thirty, all of which have been diagnosed by the management experts hired by Tang Yikun at great expense as having no future prospects and should be completely divested.

These industries encompass several sectors, including clothing, pharmaceuticals, printing, machinery manufacturing, and chemicals, spanning eleven cities across four provinces, with a total of over one hundred companies. They have now been consolidated into Donghu Machinery Company, managed by his younger brother, Tang Yiwei.

The products and industries integrated into Donghu Machinery embodied Tang Yikun's hard work and ambition, and he was infuriated that those so-called corporate development strategy consultants had labeled them as worthless industries. However, he admitted there was some merit to the expert group's assessment, as those industries and products were basically operating at a loss. The reason they were still surviving, and even appearing successful, was because of continuous financial injections. With a steady cash flow, the company could operate normally.

Why did those industries and products, initially profitable, now turn from profit to loss? Tang Yikun conducted a thorough analysis, and his conclusion largely aligned with the expert group's diagnostic report. The primary reason was the exponential increase in management costs; other factors, such as untimely product updates and low technological content, were secondary. Why did management costs increase so rapidly? Because Donghu became increasingly formalized. The hallmarks of this formalization were a burgeoning management structure, a rapid increase in administrative staff, improved social security and medical insurance, the emergence of numerous non-profit organizations, and substantial donations made to gain prestige. While Donghu Industry achieved the reputation it desired, it paid a heavy price.

Tang Yikun discovered that Donghu Industrial, which he had painstakingly built, was becoming more and more like a state-owned enterprise. His instructions and board decisions were reaching more and more levels at the grassroots level, and at a slower and slower pace. The departments set up to improve management and the large number of so-called professionals hired had turned Donghu, which had once been a fast boat cutting through the waves, into a bloated giant ship.

He couldn't emotionally accept the expert group's suggestion to drastically reduce non-core businesses, but rationally he acknowledged the experts' valid points. Reducing non-core businesses wasn't simple; they weren't like commodities sold at a discount on a street corner. They were complex entities comprised of numerous factories, equipment, and personnel. Closing them would only exacerbate his losses. Furthermore, the expert group failed to understand the plight of private enterprises. If the outside world discovered Donghu's massive business closures, there would be at least three direct consequences. First, there would be government intervention, driven by concerns about GDP growth and rising unemployment. Donghu's success was largely due to its close ties with the government; losing government support was unthinkable.

Secondly, there are rumors of Donghu's operational difficulties. Like the stock market, businesses are, in a sense, supported by confidence. What is theoretically sound often doesn't hold up in reality, and a company's success is often measured by its size. This applies to banks, governments, and businesses alike. If Donghu were to close a large number of businesses, the consequences could be that it would be overwhelmed by rumors, bank runs, and pressure from the government before even experiencing the benefits of industrial restructuring.

The last obstacle was opposition from his family. Thinking of his family members, especially those who held a dominant position on the board, Tang Yikun felt a deep resentment and helplessness. In its early days, Donghu, like most private enterprises, developed through the concerted efforts of its family members. At that time, he didn't trust outsiders and couldn't afford to hire them, relying solely on his and his wife's relatives. But now he admitted that, apart from a very few relatives, the vast majority had completely fallen behind. They couldn't keep up with Donghu's development; most of them had become foolish and lazy, turning into a group of pleasure-seeking, power-hungry, and vehemently opposed to his bringing in external talent. On the surface, they still respected and obeyed him, but secretly, they were willing to undermine Donghu Industrial for their own benefit. After the expert group issued its opinion on pruning the branches and strengthening the trunk, apart from his brother-in-law Wei Shegang, who served as president of Donghu Mining Company, there was almost unanimous opposition.

He understood that it was about taking away their livelihoods, but he hated their actions.

The expert panel believes that Donghu Industrial should focus its business on the mining and real estate sectors, which are Donghu's traditional strengths and the source of its profits.

This was indeed the case. In 2012, Donghu Industrial's total sales reached 280 billion yuan, accounting for about one-twentieth of Pingquan City's GDP. However, the mining and real estate sectors alone accounted for 210 billion yuan. The remaining twenty companies totaled only 70 billion yuan, representing only a quarter of the group's total sales, yet employing a staggering 65% of its workforce. This was one of the reasons the expert group recommended abandoning the project.

Analyzing the mining and real estate sectors, Donghu Mining Company, which laid the foundation for Donghu Industry's rise, has relinquished its position as the group's leader. Its scale is shrinking, and its profitability is even worse. In 2012, the mining company's profits collapsed, with a total loss of 6000 million yuan for the year. If it weren't for the successful listing of Donghu Real Estate Company, Donghu Industry's cash flow would likely have been cut off.

The mining companies are facing a downturn, superficially due to the sharp drop in coal prices, but the underlying reasons are more complex. Since 2011, the province has been repeatedly criticized by the State Administration of Work Safety and even the State Council, forcing it to invest heavily in rectifying coal mines. A large number of small coal mines with low output, inadequate safety facilities, and chaotic management have been shut down or merged. Not only have private small coal mines been severely impacted, but some county-run mines have also been forced to close or restructure. Donghu Mining was not among those restricted, but after the provincial work safety bureau issued its rectification report, the mining company had to significantly increase its safety investment, directly affecting its profits.

In fact, the provincial government's crackdown on small coal mines presented Donghu Mining with a good opportunity for expansion. The mining company had repeatedly submitted plans to the board of directors to merge with and acquire the listed small coal mines, but these were basically rejected by Tang Yikun. Tang Yikun clearly realized that this round of price plunges in coal and its derivative products was not temporary, but rather a trend. With the increasing emphasis on environmental protection at the national level, the large-scale use of natural gas would thoroughly suppress the coal industry. At this time, acquiring those dilapidated small coal mines would only increase the burden and would not benefit the group at all.

Data provided by the Donghu Economic Research Institute confirms the correctness of the board's decision. In 2012, sales of traditional coal-fired boilers in the province plummeted by 12%, while sales of natural gas boilers experienced explosive growth.

However, the board's decision was met with strong opposition from the mining faction, represented by Wei Shegang. Wei Shegang even had a private argument with his brother-in-law, Tang Yikun.

The situation for mining companies is precarious, and the prospects for real estate companies have also become uncertain.

Qi Zhen, Vice President of Donghu Industrial Group and President of Donghu Real Estate Company, is one of the earliest veterans who followed Tang Yikun in starting the business. He is a gem that has survived the test of time, and his ability and loyalty are beyond question. A month ago, Qi Zhen sent Tang Yikun a secret report with a handwritten note on the cover: "No copy, for the Chairman's personal reading only."

This alarming report, which listed data collected from various sources, frankly admitted that the real estate market in Pingquan and even the province was about to face a severe winter, and that early planning was necessary. Qi Zhen, as always, prescribed solutions: either drastically shrinking the battle lines or significantly opening up new battlefields.

Tang Yikun admitted that Qi Zhen's judgment was correct. Since the end of 2012, houses in Pingquan had been difficult to sell. The Emerald Garden, which everyone had been extremely optimistic about, had been on sale for two months, and its sales figures confirmed Qi Zhen's prediction. It was the most luxurious residential complex in Pingquan, with design and construction quality considered the best in the city, and had been touted as phenomenal by industry insiders. Although Qi Zhen had successfully created the illusion of booming sales and high demand, Tang Yikun knew that the actual situation was much worse than he had anticipated.

Donghu Real Estate is already listed on the stock exchange, and the data cannot be hidden for long. If Donghu Real Estate, this super cash cow, falls ill, the consequences will send chills down Tang Yikun's spine.

Considering Donghu's persistently high debt ratio, Tang Yikun knew that drastic measures had to be taken.