445 Boss Pei, How Should We Spend the Twenty Million Yuan?
March 9th, Wednesday…
Otto E1 was available for sale for the second time!
Pei Qian purposely traveled a great distance to Otto Technologies' office to observe the frontlines. The cell phones were to be sold at 10 AM. Pei Qian arrived at 9 AM to survey the situation.
After a lot of thought, he decided to make a suggestion to Chang You.
"Vice President Chang, from today onward, we should allow people to pay a deposit and reserve a cell phone. They can pay a deposit of a hundred yuan to reserve a cell phone, and we can manufacture cell phones based on the number of reservations we get."
Chang You looked pained. "Boss Pei, I know about that plan.
"Many cell phone manufacturers do that when they're running out of stocks, but we don't have that much money now. What if we receive ten thousand cell phones? We don't have enough funds…"
Pei Qian waved his hand. "It doesn't matter. You can ask me for more cash if you run out. We can use Tengda's funds to ease your cash flow. We're all under one roof, anyway.
"Anyway, just make sure we have enough supply. Every fan of Tengda should get to use our cell phone!"
Pei Qian sounded so righteous and just that Chang You felt moved.
However… Pei Qian was thinking of something else.
He was only suggesting allowing customers to make reservations for three main reasons.
First, he wanted to repel the scalpers. He had to increase the number of cell phones available, to deter those who wanted to transfer ownership of their cell phones once they got their hands on them. That way, only those who needed the cell phones would get them.
Second, he wanted to clarify how many people wanted to purchase the cell phones. If there were five thousand people, Pei Qian could manufacture eight thousand cell phones. That meant storing three thousand cell phones in the warehouse and wasting money!
Last, Pei Qian had summarized all the discussion and feedback online and concluded that only a few people would make a reservation.
After all, the cell phone was too expensive. It was more expensive than Shenhua or Pineapple's flagship models. Although the benefits looked good, most of them could only be enjoyed in Jingzhou. In other words, most people were still waiting to see how the cell phone would turn out.
The first few thousand cell phones had basically been sold to Tengda's fans that were living in Jingzhou. Pei Qian guessed that once those people got their cell phones, sales would drop drastically!
As for whether Boss Pei's judgment was right…
He had to see how the company was doing today.
Chang You had already instructed his subordinates to create a function for people to reserve a cell phone.
At 10 AM sharp, Pei Qian whipped out his cell phone and observed how many people were trying to reserve Otto E1.
Things didn't turn out as he had imagined; they did not sell out the moment they made stocks available. At first, the number of customers increased rapidly, but this slowed down after some time.
By now, many scalpers had already given up getting a cell phone because purchases were now linked to a Tengda Games account and an identity card. If they increased the price and sold it, buyers would have no way of enjoying the benefits of being Tengda's distinguished customers. Thus, scalpers saw no point in trying to snatch the cell phones.
Of course, scalpers could resort to harassment tactics like make orders and snatch the cell phones in place of others. Still, this was much better than giving them unrestricted access to the cell phones.
An hour later, there were still 1,100 cell phones left.
Pei Qian ate his lunch at Otto Technologies and watched as the cell phones slowly sold throughout the day until they sold out at about 2 PM!
Once the 'sold out' label appeared, Chang You and Pei Qian wiped the perspiration from their foreheads at the same time.
Chang You did that out of relief that the phones had finally sold out!
Boss Pei was here to supervise the process today. If they could not sell out all two thousand phones and nobody wanted the remaining, Chang You would be too embarrassed to explain himself to Boss Pei.
On the other hand, Pei Qian wiped his perspiration out of relief that they had lasted until 2 PM!
Selling out immediately would have signified a much bigger problem.
Now, Pei Qian could finally relax. The facts had shown that his judgment had been accurate. The cell phones were quite popular, but not many people could afford them.
Most consumers in Jingzhou would be limited by the speed of information transfer and their mistrust in the new brand. Those factors would have stopped them from buying a cell phone so early on.
The next step would be to wait and see how many people would reserve a cell phone over the weekend.
As long as the quantity was close to what Pei Qian estimated, he could decisively manufacture more stocks, spend as much money as possible, and aim to incur losses before settlement!
…
…
March 10th, Thursday…
In the afternoon…
Pei Qian picked up his cell phone and checked how many people had reserved an Otto E1.
Otto Technologies' programmers had worked overtime to include a reservation function on the website. Of course, Chang You had paid them full overtime allowance.
Until now, more than 1,800 people had reserved a cell phone. The number was still increasing but at an obviously slower pace.
They had four thousand cell phones prepared for Sunday.
Pei Qian began to think. It was a sure bet that the number of reservations would surpass four thousand by Sunday, but it would likely not pass five thousand.
In other words, if they manufactured more than five thousand phones, the extra phones would have to be left in the warehouse.
If they spent all the revenue they had earned from the sale of cell phones on manufacturing even more cell phones to be stored in the warehouse…
Wouldn't all of Otto Technologies' additional funds be dealt with?
That sounded like a good idea.
Pei Qian just had to count on the heavens to see things through for him.
Just as he was thinking about this, his cell phone vibrated. Pei Qian picked it up and saw that it was He Desheng. At once, he frowned.
What's happening?! Has the 'Top Student, Come Quick' application gotten into trouble again?!
That can't be. We only bought the shares a few days ago. Trouble shouldn't be occurring so soon, right?
Pei Qian quickly accepted the call.
"How's the 'Top Student, Come Quick' project?" Pei Qian asked as if faced with a powerful enemy.
He Desheng was stunned. "Er, Boss Pei… there's nothing wrong with 'Top Student, Come Quick'. Zhang Wang has something to report to you so he's here at Dream Realization Ventures. Do you have the time to meet him? If you don't, he can just give you a call."
Pei Qian frowned.
Zhang Wang? Isn't he the 'sharing maniac' and 'grassroots inventor' of the shared phone booths?
Just hearing his name infuriated Pei Qian.
You still have the cheek to meet me?! I agreed to invest in your shared phone booths back then, but what have you done in the end?
Yes, you can say that you created a phone booth because the booth contains a phone. That would make sense, but you're too good at generating profit!
Zhang Wang and Ruan Guangjian had collaborated to stab Pei Qian in the back, causing Pei Qian to completely lose confidence in Zhang Wang and his shared phone booths. Now, Pei Qian was leaving Zhang Wang to burn and perish.
After asking Zhang Wang to manufacture more shared phone booths with the money that he had earned, Pei Qian stopped checking in.
Ever since he was driven crazy by what happened with the movie, Pei Qian lost track of the shared phone booths project.
Pei Qian calmed himself down and asked, "Is he beside you now?"
He Desheng, "Yes, Boss Pei."
"Alright, pass the phone to him. I'll ask him about the shared phone booths," said Pei Qian.
"Alright."
A moment later, Zhang Wang's voice sounded at the other end of the line. He seemed excited as he greeted, "Boss Pei!"
Hearing this voice made Pei Qian feel sorrowful.
He and his project seemed so reliable in the beginning. Everything had been fine; how did they start generating profits?
Ai, what a pity!
"Yes, what's the matter?" Pei Qian asked.
Zhang Wang, "Boss Pei, the shared phone booths are no longer the focus of my work! This project can be sustained with some basic manpower. I'll let it develop at its own pace."
Pei Qian's eyes lit up when he heard this.
"Eh? What's the matter? Has something gone wrong with its management?"
Pei Qian sounded overjoyed.
Zhang Wang sniggered. "It's not that serious. I've already set up phone booths in all of Jingzhou's shopping malls. Even if I set up more, they wouldn't make money. The project has reached its peak in Jingzhou, and so I'm going to give it a rest and find something else that interests me."
Hearing this made Pei Qian more excited.
Alright, rest! That's a wise decision! Indeed, my judgment had been right all along!
The shared phone booths would only be able to generate profits if they were set up in places with high traffic such as shopping malls. What's more, there were only so many shopping malls in Jingzhou. Putting one or two shared phone booths in each one would be good enough.
Further, as more and more people tried out the shared phone booths, their interest would dissipate. That would be the end of the project in Jingzhou.
Of course, Pei Qian wanted to ask why they could not set up shared phone booths in Luzhou or Lincheng, or even Beijing or Shanghai. Weren't those markets available as well?
However, he held himself back.
All in all, Zhang Wang's timely repentance was worth celebrating!
Comforted, Pei Qian nodded. "Yes, that's good."
Zhang Wang asked, "Boss Pei, if I have other dreams to realize in the future, can I also approach you for investments?"
Pei Qian, "…Of course, but I will have to evaluate your proposals."
Pei Qian's first instinct had been to reject Zhang Wang, but he could not bring himself to do that. Thus, he had no choice but to be courteous.
Of course, Pei Qian found it highly unlikely that he would invest in Zhang Wang's projects ever again, given the latter's outstanding achievements.
That was unless he came up with a legendary project that looked like it could make Pei Qian lose everything. Then, Pei Qian would seriously consider making an investment.
"Alright, I won't keep you from working, then! Goodbye, Boss Pei!"
Zhang Wang handed the phone back to He Desheng.
"Is there anything else?" Pei Qian asked.
He Desheng answered, "Not really, Boss Pei. However… I have something to remind you. We still have twenty million yuan in our account. Have you thought about how we should spend it?"
Pei Qian recalled instructing He Desheng to remind him about the money in Dream Realization Ventures' bank account after some time.
He could not forget about that sum of money. If he didn't spend it before settlement, the consequences would be dire.
What should he spend the twenty million yuan on…?
Hm?
Twenty million yuan?!
All of a sudden, Pei Qian noticed that something was amiss!
Dream Realization Ventures had spent five million yuan buying back all the shares in 'Top Student, Come Quick'. There should be less than ten million yuan in its bank account now.
Why was there twenty million yuan?!
"Wait a moment. Where did we get the twenty million yuan?" Pei Qian had a bad feeling about the situation.
He Desheng answered matter-of-factly. "That's the profit generated by the shared phone booths."
Pei Qian's mind was filled with question marks.
What the hell?
Didn't Zhang Wang say that the shared phone booths had reached their peak in Jingzhou?
Didn't Zhang Wang himself have plans to stop working on the shared phone booths and take a break?
How did the project earn ten million yuan in such a short period?!
Pei Qian began to perspire, but he forced himself to calm down. "The shared phone booths could make ten million yuan in Jingzhou alone?"
He Desheng laughed. "Ah, Boss Pei, you didn't know yet?
"Of course, the project could not have made ten million yuan in Jingzhou alone, just like you said. Every shared phone booth could only make so much each day, and our initial investment was huge. The revenue we generated was then poured into manufacturing more shared phone booths. That's why we didn't profit much at the start.
"However, once we filled up Jingzhou City's shopping malls, Zhang Wang considered taking the project further. That's why he thought about finding franchisers to maximize profits.
"He didn't personally supervise the shared phone booths in other cities. Instead, he contacted other cities' shopping malls online and then presented to them our business model.
"Those shopping malls saw that the shared phone booths were profitable. Thus, we sold the shared phone booths to them as a package and put them in charge of maintenance and repair. All we had to do was lend them our name and take a cut of the shared phone booths' revenue.
"That helped to lower our costs since we no longer had to hire professionals for maintenance and repair or care about whether the shared phone booths were generating profits or not.
"We only had to remain seated, sell our shared phone booth packages, and take a cut of their revenue! From the current situation, it looks like this business model guarantees profits!
"That's why we only need to hire a few people for maintenance, cashiering, and managing the company's daily operations now. Zhang Wang doesn't have to be personally involved.
"We earned another ten million yuan from the sale of the shared phone booths so we're handing the funds up right away.
"How do you think we should spend the twenty million yuan, then, Boss Pei?"
"Boss Pei?"
"Boss Pei?"
