Chapter 284 Health Products
Ginseng royal jelly is a new product specially developed by Song Yuanchao for the Eighth Factory. From the product itself, it is no longer a medicine but a health product.
Speaking of health care products, the market for health care products in China is huge. In 2021, China's health care products market reached 330.7 billion, making it the second largest health care products market in the world.
Speaking of health products, the first impression in people's minds is a picture of a cartoon old man and old woman wearing glasses dancing, and then the voice-over repeats a sentence: I will not accept any gifts during the festival this year, and if I do accept any gifts, I will only accept a certain platinum...
Boss Shi started out with health products and built his business empire with them. Later, due to wrong decisions, his capital chain broke, which led to the collapse of his business empire.
But Boss Shi is Boss Shi after all. With the help of several friends, he made a comeback and in just a few years, he made a comeback with new health products. A certain platinum was very popular for nearly ten years, creating huge wealth for him and thus bringing him back to life.
But people who have lived through the 1980s know that the beginning of China's health care market was not Boss Shi and his certain gold and certain platinum products. What really opened the curtain on China's health care products market was the thing in Song Yuanchao's hand - ginseng royal jelly.
Around 1984, ginseng royal jelly came out of nowhere and swept across the country in just half a year, becoming a pioneering product in the health care product market.
This product was favored by many people as soon as it was launched on the market. Many middle-aged people in later generations still remember the small bottle of ginseng royal jelly that they had to drink every day when they were young at the request of their parents. This thing almost accompanied their childhood and adolescence, and was hailed as one of the best gifts to give to people during festivals.
But now, the birth of ginseng royal jelly began in the hands of Song Yuanchao and Lin Yuhang. While Song Yuanchao asked Lin Yuhang to stop the sales of loquat paste and cough syrup, he also suggested that Factory 8 take this opportunity to transform directly.
Traditional Chinese medicine factories like Factory Eight have no advantages, weak technical capabilities, and no flagship products of their own. Even if they have survived now, if there are no good products to follow up in the future, then the fate of Factory Eight sliding into the abyss again is still inevitable.
Therefore, it is the best choice to take advantage of the fact that Factory 8 has ample funds and there is a gap in the market for health care products to develop this type of product.
In response to the questions raised by Song Yuanchao, Lin Yuhang first talked about the production situation.
In order to make this product, Lin Yuhang made a huge bet and spent a lot of money to purchase an advanced assembly line specifically for the production of ginseng royal jelly.
Although this assembly line is not imported, it is also a first-class domestic product. If it were not for Lin Daoyuan's relationship, it would not be easy for Factory 8 to purchase this assembly line. Even so, this amount of money is not a small amount. Although Factory 8 has made a lot of money in the business of loquat paste and cough syrup, once this assembly line is purchased, the bank deposits will be reduced a lot.
In addition, in addition to the assembly line, there is also the exploration of production processes, the procurement of raw materials, and subsequent production, all of which require a large amount of capital investment.
Lin Yuhang has calculated carefully that if full production is maintained after the official launch, then with the current financial situation of the Eighth Factory, it will only take about half a year at most. If this new product does not sell as well as expected within half a year, then the Eighth Factory’s gamble will be a complete failure.
"Because of the special , the cost of the product is relatively high. According to current cost calculations, the cost of one is nearly 0.35 yuan. If it is mass-produced, the cost can be reduced to around 0.32 yuan." Lin Yuhang has personally followed this project for so long that of course he is very clear about all the data and answered immediately.
"So expensive?" Lin Yan said in surprise, but as soon as she said this, she immediately realized that this was not an ordinary product. This was ginseng royal jelly. The main ingredients were ginseng and royal jelly. These two things were not ordinary ingredients, so it was normal for the cost to be higher.
"Haha, this is still the cost price of the adjusted formula. Do you think that it is made entirely of a mixture of ginseng extract and royal jelly? If so, the cost of one tube would be several yuan." Lin Yuhang laughed at the side. Song Yuanchao only made a suggestion on the formula of ginseng royal jelly, and the specific mixing experiments were still to be carried out by the technical staff of the Eighth Factory.
It is true that the technical strength of Factory 8 is weak, but no matter how weak it is, Factory 8 is still a regular Chinese medicine factory, and the technical personnel in the factory still have some professional capabilities.
Ginseng royal jelly, although this product has never appeared before, but in traditional Chinese medicine, both ginseng and royal jelly belong to the category of medicine. In addition, traditional Chinese medicine already has the categories of "medicinal food" and tonic medicine, so technically speaking, the development of the formula of ginseng royal jelly is not difficult.
After more than a dozen adjustments and attempts, the current formula was finally determined. Of course, as Lin Yuhang said, the extract and royal jelly used in a ginseng royal jelly are not much, and the ginseng used cannot be old mountain ginseng, but the most common medicinal ginseng.
Royal jelly is indeed genuine, but it is a mixture of royal jelly and ordinary honey, and then refined honey, glucose, vitamin C, sorbic acid and other things are added to finally form the current finished product.
But even so, the cost of a finished product is not low. After all, the Eighth Factory is different from the health care product factories of later generations, and Lin Yuhang is not the unscrupulous businessman of later generations who mix various chemicals with some water and directly bottle it, and then label it as a health care product and sell it at a high price.
Just like a certain turtle essence that became popular all over the country more than ten years later, it was very popular at the time and had TV ads everywhere. But when the scam was exposed, people suddenly discovered that the main ingredient of the product - turtle, commonly known as Wangba - was not seen in the entire production factory.
The disguised reporter walked around the factory for a long time and finally found a few old turtles lazily basking in the sun in a cement pool. All the product ingredients were deceived by advertisements.
As soon as this report was published in the newspaper, the myth was shattered overnight, the turtle spirit fell completely from the lofty altar, and the inventor and owner, Lao Ma, became the target of public criticism.
After calculating in his mind, Song Yuanchao was quite satisfied with this cost. Of course, the cost will gradually increase with the price increase of raw materials in the future, but that is a story for another time. The life of a health product is at most a few years or nearly ten years. The health product market is updated very quickly. It is impossible for the Eighth Factory to survive forever by relying on ginseng royal jelly in the future. It depends on Lin Yuhang's continuous adjustments in products and operations. Song Yuanchao reminded Lin Yuhang of this. After experiencing the packaging and sales incidents of loquat paste and cough syrup, Lin Yuhang gradually understood some business and market rules.
"How's the product packaging design? You can't just rely on a paper box to sell it, right?" Song Yuanchao asked, holding up the paper box in his hand.
"Well... I've been busy adjusting the formula in the lab these days, so I haven't had time to follow up on this matter. But we can't use warm cups like before, Yuan Chao, how about you give me some advice?" Lin Yuhang scratched his head embarrassedly.
Song Yuanchao didn't know whether to laugh or cry. Although Lin Yuhang was serious and responsible at work, his shortcomings were also obvious, that is, he lacked modern business knowledge and did not pay much attention to certain aspects.
Health supplements are not ordinary products, and packaging plays a big role.
Take the previous examples of loquat paste and cough syrup. If it weren’t for the packaging, how could the products be sold, and how could Factory No. 8 be revived?
Song Yuanchao directly criticized Lin Yuhang for his idea and asked him about his opinion on the product positioning.
"Positioning? Isn't it just a health-care function?" Lin Yuhang asked doubtfully.
"Yes, it's health care, but have you ever thought about what health care products are for? Why do people buy them? And why do they buy your products?"
"Of course the product is good. It's good for the body. Could it have other effects?" Lin Yuhang wondered.
At this time, Lin Yan couldn't stand it anymore and rolled her eyes at her second brother: "Second brother, you really don't understand. Yuan Chao said it so clearly. Although this thing is a good thing, how many people do you think will buy it? Good things are used as gifts. Yuan Chao means that the packaging must be beautiful so that people will buy it!"
Lin Yuhang was stunned. It's not that he didn't think about these things, but he didn't think about them deeply. The Chinese have always believed that courtesy is the best thing, and there is a tradition of bringing gifts during festivals or when visiting relatives and friends. Especially with the continuous changes in reform and opening up, this trend has gradually become more and more prevalent.
Facing Lin Yuhang's reaction, Song Yuanchao gave him another lesson about packaging. In later generations, health products were over-packaged. A box of health products that looked extremely exquisite was actually 80% useless packaging, and the real product only accounted for about 20% of the total packaging volume.
But even so, people still come to buy it. The reason is very simple. The exquisite packaging is suitable for giving as gifts.
Now, excessive packaging does not need to be so outrageous, but necessary packaging is still needed. Only a certain degree of exquisite packaging can make consumers feel the high-end of the product and be willing to pay for it.
After listening to Song Yuanchao's explanation, Lin Yuhang guiltily admitted his mistake to him, and at the same time shamelessly asked Song Yuanchao for advice on packaging design.
Although Song Yuanchao was not a designer by profession, he had seen pigs run even though he had never eaten pork. He immediately found some paper and drew a few shapes. Unfortunately, his drawing skills were very poor. Apart from the rough outline, some of the contents were drawn crookedly, especially the flying bees that Song Yuanchao drew looked more like flies, which made Lin Yan, who was watching on the side, laugh out loud.
"Okay, okay, I'm not good at drawing, so stop laughing. If you keep laughing, the bee will turn into a fly and then into a watermelon seed..." Song Yuanchao started to laugh as he spoke. He shook his head and handed the drawing to Lin Yuhang: "Brother, just bear with it. I'll just give you a suggestion. You still have to find a professional to do it."
"Where can I find a professional? We don't have such a person in our factory." Lin Yuhang looked at Song Yuanchao's graffiti from top to bottom and said with a worried look on his face.
"This isn't that easy. Second brother, you're really something. Why don't you go to the Academy of Fine Arts and ask? You don't have to look for teachers at the school. You can find a few third or fourth year college students and ask them for help. Then your factory can just give them some hard work fees, right?" Lin Yan's mind was active, and she immediately gave Lin Yuhang an idea.
