Chapter 898 Waiting for a Price
When Shenghua VCD was launched on the market, Song Yuanchao was in charge of Shanghai and kept an eye on the market feedback.
Before the product was launched, Shenghua made a lot of preparations and invested a lot of marketing funds. It even set up special counters in central shopping malls in major cities across the country and dispatched Shenghua staff to promote the product in place of the mall's sales staff.
The same is true for the Hong Kong market. The launch time in both places is the same. After about a week of overwhelming advertising, VCD became widely known before it was launched, although no one had seen the real thing yet.
In Hong Kong, the final price was HK$2,600, while the price in the mainland market was HK$2,300.
The sales price was decided by Song Yuanchao. Although it was more expensive than the current VCRs, it was not too much more expensive. In addition, Shenghua also had a three-day promotion with a 10% discount and a free microphone and VCD disc, so the price was basically the same.
But in fact, the cost of a VCD player is not high, because Shenghua has all the technologies for VCD players, and Shenghua Electronics enjoys preferential purchase of spare parts for large-scale production. Currently, the cost of a VCD player at Shenghua is about 580 yuan.
In other words, from cost to sales, the gross profit margin of VCD reached a huge 4 times, and even because of promotions, it was 3.5 times.
What's more, this cost is the current cost. Shenghua's laser head research and development is about to be successful. After the laser head is developed and put into actual production, this cost can be further compressed. According to estimates, it can be compressed to a price of 500 yuan per unit.
If the scale of production is further expanded, it is estimated that the cost of the product can be reduced by at least 20% on this basis. In this way, the cost can be reduced to around 400. Compared with the selling price, the profit is extremely amazing.
In order to expand the market and ensure a successful start, Shenghua has been operating the factory at full capacity for more than a month, just waiting for this day.
At present, Shenghua has prepared more than 20,000 VCD players in the entire market. Excluding the sales inventory, 2,000 of these VCD players have been put into the local market in Hong Kong, and the rest have all been put into the mainland market, including sales outlets in major cities such as Yanjing, Shanghai, Yangcheng, Tianjin, Shancheng, Hangzhou, Jinling, and Pengcheng.
Among them, Yanjing, Shanghai and Yangcheng are the most important places with the largest investment, while other cities have slightly less. As for some other cities, it is not that Song Yuanchao gave up voluntarily, but because there are really not many finished products on hand, and there is no way to fully cover the entire market in such a short time.
At noon, the feedback from various places was very good, but the final data will not be known until the end of today's business.
But even so, according to the current feedback, in just half a day, the data summarized from various places reached more than 1,300 units, which made Shenghua very excited.
By the evening, the data was still rising, and the sales amount reported during dinner had exceeded 3,000 units. The real number was definitely higher than the current number, because it takes time to summarize and report from different regions, not to mention that it was not yet time for the store to close for the day.
"Ding-ling-ling!"
The phone on Song Yuanchao's desk suddenly rang. Song Yuanchao picked up the phone and heard Qin Zhengguo's voice.
"Aid Korea! Hong Kong is starting to run out of stock!"
"Out of stock? So quickly? I just received a summary saying that there are only 3,000 units in total in all other places, and we have 2,000 units in Hong Kong!"
Qin Zhengguo said on the phone: "This summary figure is inaccurate. I went downstairs and found that the VCDs in various shopping malls are really hot. Besides, there is a time lag in the summary statistics. The stocks of several shopping malls are almost sold out, and they are urging us to restock!"
"How about this, you immediately notify the factory to urgently adjust the stock and ensure that the sales inventory is guaranteed. By the way, you also need to inform the factory that starting from tomorrow, the factory will adjust the production shifts and produce in three shifts. No matter what, we must ensure the output!"
"That's no problem! It's too late today and I can't get through. I'll call the factory right away and go to Pengcheng to check on the scene tomorrow morning. By the way, what's the situation in the mainland now? Have all the data been summarized? And are there any problems with the transfer of goods from the mainland?"
"We have to wait for the final data. I will arrange the transfer of goods from the mainland. Fortunately, we made preparations in advance and prepared a batch of stocks in several places, otherwise we would be caught off guard." Song Yuanchao replied.
"Okay, you and Daqi stay in the mainland to keep an eye on it, and don't worry about Pengcheng and Hong Kong, I'm here for you. By the way, as for the aid to North Korea, this time our product is a hit, it looks like we're going to get rich, do you want to hold a celebration party?" Qin Zhengguo's voice on the phone sounded very excited.
Song Yuanchao smiled and said, "We must hold a celebration party, but it's still too early. Let's wait until this period of time passes and the market slows down. Go to the factory and convey my intentions. Tell them that the company has decided to give everyone bonuses for the big sales of VCDs this time. As for the amount of bonuses... let's calculate it based on one month's average salary first, as a way to give the factory employees some incentives."
"That's no problem!" Qin Zhengguo agreed immediately. He understood what Song Yuanchao meant. Due to the hot sales of VCD players, the most important thing now is production. You know, the profit of each VCD produced is 1,500. The speed of making money is even faster than robbing money.
Today was the first day the product was on the market and the sales data was so astonishing that it was beyond Qin Zhengguo's imagination.
Judging from this trend, the more than 20,000 units of inventory currently prepared by Shenghua will be sold out in just a few days.
"By the way, regarding aiding North Korea, according to the current sales situation, even if the factory operates three shifts, the production may not be able to keep up with the sales. Should we consider finding a few companies to do the production?"
Qin Zhengguo asked Song Yuanchao on the phone and proposed OEM suggestion.
This issue has never been discussed before, because after Shenghua Electronics acquired Liu Da's factory in Pengcheng, its scale has become not small, and VCD is a new product. No one can be sure about the market situation of this product without real promotion and sales.
In order to launch the VCD this time, Song Yuanchao boldly invested more than 80% of the factory's output into the early production of VCD, which can be said to be full-load production.
During the more than one month of preparation, Shenghua stockpiled more than 20,000 VCD players. Judging from this number, Shenghua has made a heavy bet on this product. You should know that just the stockpiling of this number of products plus various expenses has cost Shenghua tens of millions. Once the VCD sales are not satisfactory, these investments will not only fail to pay off, but will even cause Shenghua to suffer heavy losses.
Song Yuanchao made the final decision. Although some people in Shenghua thought that Song Yuanchao's decision was a bit too bold, it was finally implemented because of the support of Qin Zhengguo, Li Daqi and Xu Hui. The feedback from the market now proves that Song Yuanchao's vision was right and the previous decision was accurate.
According to the current factory output, even if it works in three shifts, the monthly output is only about 20,000 units. This output figure is already not small, but judging from the actual sales situation in the current market, this output is far from enough.
"Don't consider OEM for the time being. Communicate with Xu Hui and notify the supplier to add two more production lines as soon as possible to further expand production. As for the OEM issue, let's put it aside for now." Song Yuanchao thought for a while and gave Qin Zhengguo an answer that surprised him.
"If we do this, won't we be able to make no money? If we outsource it, we can increase production several times in a short period of time. There's no need to put it on the assembly line and produce it ourselves." Qin Zhengguo was stunned for a moment, and couldn't help but say something, not quite understanding Song Yuanchao's idea of refusing to outsource.
OEM is nothing more than paying a little OEM fee. Although it will increase the production cost, the increase is not large. Moreover, OEM can save a lot of trouble and meet the current production shortage in a very short time. But Song Yuanchao actually rejected this suggestion, which made Qin Zhengguo very puzzled.
"I will explain this question to you later. We don't need OEM for the time being." Song Yuanchao answered directly.
"Okay, you're the boss, you have the final say." Qin Zhengguo answered on the phone, and his tone sounded a little unhappy.
Song Yuanchao thought for a moment, then slowed down his tone and explained to Qin Zhengguo: "Zhengguo, VCD is a new product, and you can say it is a revolutionary product. Before this product appeared, the dominant position in home video was occupied by VCRs, and now VCDs have emerged, seizing the original VCR market and making a subversive change to the product structure."
"I understand your idea. In fact, OEM production is indeed a good idea, and the market feedback so far has proved that our choice is correct. But don't forget that our products are, to put it bluntly, snatching the market from traditional VCR manufacturers. They haven't reacted yet, and when they react, they will definitely take some measures."
"Means? What do you mean..." Qin Zhengguo said thoughtfully.
"The patented technology of VCD is in the hands of an American company. Previously, we contacted some companies that hold some technology through American companies, intending to exchange some patents with them using VCD technology, but they refused. Now, the success of VCD is doomed, so the next step is to compete for the market. I think they will react soon."
"When these companies react, patent exchange will become possible. Before this goal is achieved, once we hand over the product to others for OEM, can you ensure that the technology will not be leaked during the production process? Don't talk to me about patent protection. Many means in business are very dirty. Even if they do it openly, it is very likely that they will do something dirty in private. Besides, the manufacturers that can OEM VCD products in the mainland are also the OEM factories of these companies. The bosses of these factories will not care about whether you have a patent or not. In their eyes, making money is the first priority. Whoever gives more benefits will do anything."
