All the heavens begin with the love in the courtyard.

Helpless, Lei Dongbao could only raise salaries, but he still couldn't prevent a small number of employees from being poached by the other party. People die for money, birds die for food, and Lei Dongbao couldn't possibly be unaware of this age-old truth.

Not content with poaching talent, in May, Cheng Yang Electric Appliances officially entered Anyun Province, with its first store in Jinzhou. Moreover, the store was located between Lei Dongbao's Jiangcheng Electric Appliances and Jinzhou Department Store, seemingly aiming to provoke both of them.

Cheng Yang Electrical Appliances City's store directly connects with three other shops in the surrounding area. Just based on this connection, Lei Dongbao felt that he definitely wouldn't be able to win them over; those three shops were all tough nuts to crack.

After connecting the three stores, Cheng Yang Electrical Appliance City's total floor area has reached 400 square meters, which is larger than Jiangcheng Electrical Appliance City, which is only 200 meters away. Moreover, the latter's decoration is more luxurious. During the ten-day grand opening promotion, they announced that the grand prize would be 20 large color TVs, and the first prize would be 20 washing machines, 20 refrigerators, and 20 air conditioners. As soon as this news came out, the people of Jinzhou went crazy, and even the doorstep was broken down.

This has caused Jiangcheng Electrical Appliances City's sales to plummet, and Lei Dongbao estimates that it will be difficult to recover in the future. At least, the majority of high-end customers will be taken away by the other party.

Lei Dongbao was also annoyed by this. He called Yang Xun to ask what Yang Xun meant, but he received a nonchalant reply from Yang Xun, who finally said...

"Brother Lei, I'm just a small shareholder. All these plans were arranged by higher-ups, and I'm just following orders. So I'm sorry!"

Lei Dongbao was so angry that he hung up the phone immediately. Yang Xun has really made a name for himself now!

He was indeed just a figurehead pushed out by the other party, but Lei Dongbao knew very well that all of these business plans were made by Yang Xun himself. This man was a menace, but also a business genius. Unfortunately, he went astray and would get into trouble sooner or later!

Even though he knew Yang Xun was a menace, he still couldn't deal with him. Lei Dongbao didn't want to play dirty tricks; he wanted to play fair and square. But Yang Xun wasn't afraid of him. So, Lei Dongbao had no choice but to endure it. He also didn't want to become Yang Xun's son-in-law.

This is reality!

Moreover, the other party clearly wanted to support Yang Xun to rise to power. In May, Yang Xun appeared on the front page of the Anyun Provincial Daily, officially debuting as an outstanding entrepreneur of Anyun Province.

Cheng Yang Electrical Appliances City is now clinging to Lei Dongbao. Soon in June, other stores from Cheng Yang Electrical Appliances City will follow, and they will be located no more than a kilometer away from Jiang Cheng Electrical Appliances City. After receiving this news, Lei Dongbao can only clench his fists in frustration!

Although the other party's store was glamorous and attracted a large number of high-end customers, Cheng Yang Electric Appliances was completely defeated in terms of after-sales service.

Although they also promised on-site installation and warranty service, customer satisfaction was significantly lower than that of Jiangcheng Appliances. The reason for this was naturally because they expanded too quickly and their internal management was extremely chaotic.

Cheng Yang Electric Appliances relies almost entirely on partnerships with local repair shops for after-sales service. The advantage of this is that after-sales issues can be resolved quickly, requiring only a payment to the partner. However, the consequence is that when a customer needs after-sales service, it often takes several days for the repairman to arrive at the customer's home. Moreover, the repairman takes the opportunity to charge for various reasons, claiming that the on-site service is free, but that replacing parts will incur additional charges.

Jiangcheng Electric Appliances, on the other hand, relies almost entirely on its own trained technicians for after-sales service, and has its own repair centers in each city. Although this increases costs, the after-sales service and quality are significantly higher than those of Chengyang Electric Appliances. This kind of reputation, which has been gradually built up, is completely unnecessary for Chengyang Electric Appliances now.

Because their current goal is to expand rapidly by opening more stores, by August they had opened more than 30 stores in Anyun Province and Zhijiang Province, while Jiangcheng Electrical Appliances had only just surpassed 40 stores.

At this rate, Jiangcheng Electric Appliances' three years of hard work can be caught up by others in just one year.

With its rapid expansion, high-spending marketing, high-end imported goods, and high-priced individual products, the competitor's sales increased month by month. By October, its sales had surpassed those of Lei Dongbao's Jiangcheng Electric Appliances.

Lei Dongbao had been patiently waiting for an opportunity.

In his view, the other party's development model was fraught with crises, and through Lao Xu's connections, he learned that the higher-ups had already taken notice of those people in Fujian Province. After all, they were far too arrogant. Have you ever seen hundreds of trucks swaggering around transporting all kinds of imported goods to other cities every day?

By the end of 1985, Cheng Yang Electric Appliances had officially reached sixty stores in Anhui and Zhejiang provinces, while the number of stores in Jiangcheng Electric Appliance City had just exceeded fifty, which could be considered as achieving Lei Dongbao's goal at the beginning of the year.

In just one year, Cheng Yang Electric Appliances successfully surpassed Jiangcheng Electric Appliances, not only in the number of stores but also in sales revenue.

But at this moment, Lei Dongbao realized that the opportunity had arrived. The higher-ups had issued orders to crack down on imported goods from Fujian Province, and the other party would definitely be implicated.

Therefore, Lei Dongbao decided to officially launch a counter-offensive in 1986.

Lei Dongbao received the news, and Yang Xun and the others naturally received the news as well. Their iron triangle officially came to an end at the end of 1985. At this critical moment of life and death, Yang Xun also showed his cold-bloodedness and superb eloquence.

At the end of 1985, no one knew what Yang Xun had gone through. All that was known was that after 1985, the imported appliances in Cheng Yang Appliance City quickly disappeared and were replaced by domestic appliances. Cheng Yang Appliance City itself remained intact, but the rapid expansion of stores was halted, and they began to reorganize the existing sixty stores.

Lei Dongbao received news that Yang Shaodong had been injured and taken to the toilet, along with his father. To his surprise, Yang Xun was unharmed and continued to run his shop. However, seeing the recent activities at Cheng Yang Electrical Appliance City, he vaguely guessed that something must have happened inside.

Lei Dongbao wouldn't give Cheng Yang Appliance City time to reorganize. Cheng Yang Appliance City must be extremely weak right now. After their imported appliances were withdrawn, their popularity plummeted. They opened sixty stores in a year, each with a large investment. Does the other party really have that much money?

Moreover, judging from the other party's supply situation, Lei Dongbao learned that the other party also settled accounts with those contract manufacturers every three to six months, which meant that the other party's funds were definitely not as abundant as he had imagined.

Moreover, the expenses of the other party's store were much greater than those of Lei Dongbao's Jiangcheng Electrical Appliance City. Lei Dongbao's counterattack was simple and the most effective move!

Price war!

Yes, Lei Dongbao was planning a price war with Cheng Yang Electric Appliances in 1986. Weren't you so great at running stores? Weren't you rich and powerful?

Let's have a price war then!

Once a price war breaks out, it poses an extremely severe test to all departments and aspects of a company.

Lei Dongbao also began planning and preparing for this price war. The first step was to conduct emergency training for service personnel and to increase the number of after-sales staff.

There's also the need to negotiate prices with various contract manufacturers in advance. For example, in previous years I would only buy 100,000 light bulbs from you, but this year I will buy 500,000. So you must give me the wholesale price for 500,000 in advance. Only by getting the cheapest and most affordable source of goods can Lei Dongbao be confident in meeting the challenge!

The logistics and marketing departments also need to be mobilized. Inventory needs to be stockpiled in advance, marketing posters and flyers need to be prepared in advance, and marketing copy and plans need to be prepared at the same time. Everything is ready, and it is already the end of April 1986.

Yang Xun sat wearily in his office. In the past six months, both Cheng Yang Electric and he had almost gone bankrupt. Fortunately, he managed to resolve the crisis and even gained more profits. Now, his shares in Cheng Yang Electric have increased from 20% to 25%.

The extra half-tenth of the shares naturally belonged to Yang Shaodong. After Yang Shaodong suffered a loss, he was naturally eliminated, and his thirty percent of the shares were naturally divided up.

Yang Xun received half a percent, and the remaining 25 percent naturally had a new owner. Cheng Shao's 40 percent share was reduced to 30 percent this time because two owners were brought in, and these two owners valued Yang Xun highly, so he received a reward of half a percent.

Yang Xun was very satisfied with his performance. His business performance was also excellent, which was his asset.

However, he naturally knew that his own excellence was far from enough. To become a superior person, he had to endure things that others could not bear. This thing is called patience.

Yes, only through patience can he reach a better position. Yang Shaodong is just his first stepping stone, and Cheng Shao will not be his final boss. In the future, he will use each stepping stone to become a true tycoon. He believes that day will come. Every act of patience is a new challenge for him!

Little did Yang Xun know that he was about to face a new challenge: a commercial price war he had never experienced before was about to launch an attack on him!

Chapter 97: Price War 3.0 Launched

The Heavens Begin with Love in the Courtyard, Chapter 97: Price War 3.0 Launched. On May 1st, Yang Xun suddenly received a notification from his subordinates that their competitor, Jiangcheng Electrical Appliances City, was launching a large-scale fourth-anniversary promotional event that would last for a month.

At first, Yang Xun didn't take it seriously. Promotional activities were held by both parties every year. However, since last year, when Cheng Yang Electric Appliances took the lead over Jiang Cheng Electric Appliances in both the number of stores and sales, he stopped taking Lei Dongbao and Jiang Cheng Electric Appliances seriously.

In Yang Xun's view, Lei Dongbao was already past his prime. In less than two years, his Cheng Yang Electric Appliances had far surpassed Jiangcheng Electric Appliances. Because of his connections and capital, Lei Dongbao, a small-time operator, was simply no match for him. If it weren't for the turmoil that occurred in the past six months, which cost Cheng Yang Electric Appliances a large sum of money to avoid further trouble, it would have already exceeded one hundred stores by now.

Young people are always self-righteous. Yang Xun in this world has suffered far less from the harsh realities of society than in the original story. His smooth-sailing life over the past few years has made him lose some of the vigilance he should have.

On May 2nd, Yang Xun was still half asleep when he received calls from the managers of several of his branch stores. He groggily got up, still a little confused, until the second manager spoke on the phone.

"Manager Yang, we need to think of a solution quickly. Jiangcheng Appliances is really going all out this time. Their promotional prices are half the price of many of our products. I've also seen their flyers. Their promotion lasts for a month. By the time they finish their promotion, it will be too late. Yesterday, our sales at the Jinzhou store were only one-tenth of what they usually are. They've almost completely snatched up our customers!"

The store manager's words instantly sobered Yang Xun up. He wiped the sleep from his eyes, slowly put down the phone, and his expression was ruthless. He secretly sneered in his heart, wondering if Lei Dongbao was about to retaliate.

Isn't it just a price reduction and promotion?

Bring it on! Who's afraid of who?

Yang Xun naively believed that price reductions and promotions were just that—price reductions. He thought that Lei Dongbao's tactics were simply a way to make money or lower profits.

He understood this strategy back when he was still selling steamed buns. Selling three steamed buns was two cents cheaper than selling two. If a customer wanted a twisted roll, he could round it up to a whole number, just to make the customer feel like they were getting a good deal. It's a business strategy that even a child could figure out.

Yang Xun washed his face and returned to the company headquarters. Interestingly, his company headquarters is now also located in Jiangcheng, just like Lei Dongbao's. This is because he can have a comprehensive view of everything here, and he can also know the actual sales situation of stores in various provinces and cities every week based on the number of shipments.

According to Yang Xun, Cheng Yang Electric Appliances is currently developing very well, and he originally planned to reorganize these sixty stores this year.

Last year, due to the rushed opening, the staffing was somewhat chaotic. Many store managers had no sales experience and were hastily put into their positions. He plans to use performance evaluations to dismiss a group of managers and recruit a new batch.

He also plans to improve some company rules and regulations this year. In short, Yang Xun believes that Cheng Yang Electric Appliances has many minor problems, but almost none major ones. He only needs six months to rectify the situation, and Cheng Yang Electric Appliances will set sail again next year and expand outwards once more.

But clearly, Lei Dongbao wouldn't give him that chance.

Upon arriving at the company, Yang Xun immediately obtained the sales figures for the company's sixty stores from the previous day. The results were shocking: almost all sixty stores had been overwhelmed by Jiangcheng Electric Appliances' sales.

Starting from the end of April, the other party deployed a large number of promotional personnel to distribute a large number of flyers in the high-traffic areas near Cheng Yang Electrical Appliance City.

Yang Xun was holding a flyer with the words "Jiangcheng Electrical Appliances 4th Anniversary Promotion Month Begins!" prominently displayed at the top. "To thank our customers for their support of Jiangcheng Electrical Appliances over the past four years, a month-long appreciation event will officially begin from May 1st to June 1st!"

Below the flyer was a dense array of product images, with the original price and promotional price noted below each image. Many items were priced at almost half their usual price, causing Yang Xun to frown deeply!

Yang Xun immediately summoned the marketing department staff to his office and asked them what they thought of the promotional leaflet.

The marketing staff were also caught in a dilemma, and finally, a manager mustered up the courage to speak.

"Manager Yang, based on the prices of those goods, I think there's no profit left. Some items are even a few cents cheaper than our purchase price. Are they doing charity? They're going to lose money hand over fist!"

Hearing the other party's mocking tone, Yang Xun felt a surge of anger. He slammed his hand, along with the promotional leaflet, onto the desk and shouted angrily.

“I hired you to do something, not to just sit around and do nothing. This flyer has been distributed everywhere for a week now, why didn’t anyone notice? Why didn’t anyone notify me?”

Yang Xun's anger made everyone look at each other in dismay, and finally they all lowered their heads. In the 1980s, they didn't really care about this kind of promotion, because it was a seller's market. Businesses faced far less competition than in later years. There was no need for so many tricks to engage in loss-making promotions. As long as the location was good, customers would come to the store as soon as they opened their doors!

In addition, the previous crazy marketing spending and advertising on various channels had an exceptionally good effect, almost crushing the competition. This included Jiangcheng Electric Appliances. So when Jiangcheng Electric Appliances suddenly came up with this move this year, no one realized the danger until yesterday's sales figures were tallied, and then the store managers and administrators realized the danger.

Yang Xun rubbed his temples. His subordinates were a bunch of good-for-nothings. It seemed that a cleanup operation was urgent. He could take this opportunity to test those good-for-nothings. The capable should rise and the incompetent should get out!

Yang Xun composed himself for a moment and then addressed the crowd.

"Have all headquarters staff gather at the plaza in front of the building for a meeting before 10:00 AM. Also, have all store managers and assistant store managers outside the headquarters arrive in Jiangcheng for a meeting before 8:00 AM tomorrow. We are about to have a tough battle to fight. If we don't win, you're all fired. You're taking high salaries but doing nothing. Cheng Yang Appliances doesn't keep good-for-nothings!"

Yang Xun's work style is indeed swift and decisive, and he is also very sensitive to business events. When he received this promotional leaflet, he already understood that Jiangcheng Electric Appliances was serious this time, and it was far more than just a loss-making promotion on the surface. Lei Dongbao's target was his Cheng Yang Electric Appliances, and Lei Dongbao was retaliating!

Cheng Yang Electric Appliances reacted quickly. On the morning of May 3rd, banners for the anniversary celebration were already hung in front of every store, and all employees were mobilized. Promotional leaflets were also quickly distributed. This was a blatant challenge to Jiangcheng.

When Lei Dongbao received their promotional leaflet in his office, he couldn't help but nod in approval, praising Yang Xun as a truly talented individual. The promotional items on the leaflet were almost all similar to those at Jiangcheng Appliances, but at lower prices.

Both sides are engaged in a price war in small home appliances because they both know that attracting customers is the most crucial winning strategy.

The prices on the flyers were almost all a few cents to a dime lower than those at Jiangcheng Electric Appliances. The most outrageous thing was that light bulbs, which were originally a little over a dime each, were being sold by Chengyang Electric Appliances for just one cent each, with a limit of two per person.

The other party has discovered the essence of Lei Dongbao's promotional leaflet!

Correct!

The cheapest items in Lei Dongbao's promotional leaflet were basically household appliances such as light bulbs, switches, and power strips. Lei Dongbao sold these essential household appliances at cost price.

Because these products are used by every ordinary person, they are powerful tools for attracting customers, which is why Lei Dongbao is so cheap. Yang Xun is very clever. In just one day, he grasped the essence of Lei Dongbao's promotional leaflet. This time, he went even further, offering light bulbs for one cent each. He was prepared to fight to the bitter end!

Lei Dongbao looked at the flyer in front of him and a smile appeared on his lips. Since the other party had accepted the challenge, let's begin the first battle!

On the fifth day, Jiangcheng Appliances changed its promotional leaflets again. This time, not only were light bulbs available for one cent each, but there were also many other items priced at one-third or even half the usual price. This included almost all electrical appliances, from pressure cookers to water heaters, refrigerators, washing machines, and air conditioners. Jiangcheng Appliances began to significantly reduce prices on these high-priced appliances.

After this promotional leaflet was released, business at Jiangcheng Electronics City quickly rebounded, the doorsteps were once again overwhelmed with customers, and sales soared.

When Yang Xun saw Lei Dongbao's 2.0 version promotional flyer, he was so angry that he had to order his men to follow suit. At this point, it was either you die or I die. It was just a loss-making promotion, so who was afraid of who?

The price war between Jiangcheng Appliances and Chengyang Appliances quickly escalated. The two sides traded goods back and forth, and the appliances in the appliance store were almost half the price of those in the market. This made people very happy, and almost everyone with spare money came to buy. As the market leader, Chengyang Appliances soon felt all kinds of pressure coming at them.

In order to suppress Lei Dongbao, Yang Xun would follow suit every time Lei Dongbao lowered the prices of his products, and even lower them than Jiangcheng Electronics. His plan was indeed successful. In May, Cheng Yang Electronics City's sales still surpassed those of Lei Dongbao's Jiangcheng Electronics City.

Sales for both sides surged, more than tripling compared to May sales in previous years. However, the performance achieved through these low-price promotions was essentially a loss-making business. Lei Dongbao did the math at the end of May and found that the fifty stores had an average monthly loss of over 30,000 yuan, which is a loss of 1.5 million yuan.

However, Lei Dongbao predicts that Cheng Yang Electric Appliances will suffer even greater losses, perhaps exceeding four to five million yuan, or even more.

There are two reasons for the huge losses. First, the other party's price reduction was even greater than Jiangcheng Electric's. Second, the other party rushed into this price war, and its costs far exceeded those of Jiangcheng Electric in terms of personnel, logistics, supply chain, and a series of other issues.

Take some product promotions as an example. When Lei Dongbao was selling certain products at a loss, the prices for these products had been negotiated with the manufacturers two months in advance. Because of the volume, the other party was able to offer such low prices. However, when Cheng Yang Electric saw that some products on Jiang Cheng Electric's promotional leaflet suddenly had a significant price reduction, they had no choice but to follow suit with the same price reduction the next day, even at a lower price than Jiang Cheng Electric. Yet, the purchase price of these products was far higher than that of Jiang Cheng Electric.

So, due to a combination of reasons, Cheng Yang Electric Appliances is really feeling the pinch this time!

However, the competition between the two sides also had one benefit: the reputation and sales of both stores increased significantly. Some small state-owned stores became victims of this promotion, with their sales plummeting for an entire month. Some township collective enterprise stores even went bankrupt, indirectly eliminating some competitors in the market.

This is one of the benefits of price wars: when the top two players compete, the third, fourth, and fifth players are often the ones who suffer the most because they are innocent bystanders caught in the crossfire.