Chapter 102 – Obsoleted Trucks
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It was almost the end of the semester, and Feng Yu was concentrating on his studies. Luckily for him, year 1 was not too difficult, and with the help of Li Na, Feng Yu caught up with the rest of his classmates.
Feng Yu received a call from Brother Ki when he reaches home at night.
“Brother Ki, what good news you have for me? Are you ordering more goods this month?” Every time Kirilenko called, Feng Yu would be in a good mood. Anyone would be happy if the god of fortune calls them.
“My dear Feng. I will be ordering more goods this month, but I got something more important. Do you want obsoleted trucks? 80% new trucks. I can sell it to you at half price.”
Trucks? Soviet Gaz trucks?
Feng Yu did think of purchasing a batch of trucks. His father’s factory had spent a lot on transportations, and the demand for delivery trucks in Bing City was rising. It would be profitable if he were to set up a delivery company.
“What’s the quantity? You sure these are 80% new?”
“At least 50 trucks. The maximum is 80 trucks. All were produced last year. There were manufactured for the military and were seldom used. They haven’t even passed the run-in period. But for some reason, these trucks will be obsolete after the New Year!”
Hah, these people were shameless. Manufactured in 1987 and not really been utilized. So fast obsoleted?
“Brother Ki, I want to work with you for the long term. Will it be risky if you do this? If you need money, I can lend it to you first. I won’t charge you interest.”
Feng Yu does not want Kirilenko to get into trouble. The next two years were the best time to import from the Soviet Union. For these measly profits, they might be risking more significant profits in future.
It was not easy to build up this relationship with Kirilenko, and it would be hard to look for someone else.
“Ha, ha, ha. Feng, what you said made me very happy. But this time it’s not me. It’s Ivanovic. He needed a sum of money and asked me to contact you. I can guarantee you that the mileage for these trucks were less than 50 KM. This condition is still good.”
Ivanovic was one of those that came to China the last time with Kirilenko. His father’s rank in the Soviet army was higher than Kirilenko’s father. Feng Yu was much relieved when he knew that it was not Kirilenko that was taking the risk. These trucks had traveled less than 50 KM and haven’t even completed the run-in period.
“Okay. I will take all the trucks. How about this? A few days later, when the river was frozen, just drive the truck over and this way, the trucks can complete the run-in period. Let me think if I need anything else so you can deliver it at the same time. You have anything good to recommend? I prefer those industrial products.”
“How about refrigeration compressor? These things are very cheap now. There is no market. You can sell it to the South. The quality is not bad.”
In his past life, Feng Yu had read in the papers that the Soviet Union produced refrigeration compressor was still in good working condition after 50 years. It had never broken down before.
“Are these compressors expensive?”
“Of course not. I will send you the quotation later. You can assemble these machines into refrigerators or small cold storage. You will not make a loss!”
Kirilenko was getting better at doing business. He knew which type of products would be favorite in the China market and what products from China would be popular in the Soviet Union.
“Fine. You give me the quotation, and I will decide how many units I need. Help me to search for the manufacturing machinery. After the New Year, there will be opportunities for us to earn from those.” Feng Yu kept painting beautiful pictures for Kirilenko to condition his mind. If he decided not to import these technologies or manufacturing machines now, then it would be more challenging to do this type of trades after the dissolution of the Soviet Union.
“Feng, I have a problem. If we were to drive the trucks across the river and into China, there might be problems with the paperwork. All this while, I am using the military’s carriage when I send goods to you. This time, it might be a bit troublesome for you.”
Feng Yu also felt that this was a bit troublesome. All this while, he had gotten used to Kirilenko arranging the transportation, and there was very few paperwork as they were using the military carriages to transport these goods. But this time it was a bit troublesome, especially the taxes. The taxes will not be a small sum.
“Let me think of a way. You send me the prices first.”
Back at the company, Feng Yu sat in his office in a daze. Wu Zhigang had just returned from another province. He had heard that one of the factories in Liao Province was looking for a high-temperature steel furnace.
High-temperature steel furnace? This thing was not cheap. This factory in Liao Province was really willing to spend. At least much better than the Machinery Factory in Bing City. The high-temperature steel furnace’s prices were based on the volume and temperature. It would cost from 5 million Rubles to 30 million Rubles. China cannot manufacture this type of furnace, and only the US or Europe had the technology.
“Zhigang, rest for a few days. You had worked hard. Tomorrow accompanies me to the City. We need to get the approval to import a fleet of vehicles.”
“A fleet? What fleet?” Wu Zhigang was curious. The company uses the railway typically to import stuff.
Feng Yu explained briefly to him, and he said: “Director Feng, I have an idea, but I am not sure if it will work.”
“Tell me about it.”
“We can ask Kirilenko to set up a logistics company to deliver our goods. This way, we only have to pay the taxes for the goods and not for the fleet. After the fleet reaches here, we ask Kirilenko to write us an IOU, stating that he owed us money and was unable to pay us. We can then keep his fleet of trucks as his payment for his debt. This way, we do not need to pay the taxes.”
Feng Yu’s mouth opened wide in astonishment. How come he did not think of this idea?
This method was commonly used in his previous life for the property market. All it takes was a few days of legal proceedings and still can avoid taxes!
“Zhigang, you are a great help! Once this thing is over, you will get a reward of 10,000 RMB!”
“No need so much.” Wu Zhigang was grinning from ear to ear.
“That settles it. You had saved so much for the company, and you deserve it! Okay. You can report off today.”
One cannot be stingy towards subordinates, especially subordinates who are able to think out of the box. This way, these subordinates will be willing to do their best for the company and help the company to achieve higher profits.
In the evenings, Li Shiqiang brought back the quotation for the refrigeration compressor faxed over by Kirilenko. Feng Yu looked at the quotation, and indeed, the prices quoted by Kirilenko was very low. If he was able to resell these compressors to the South or manufacture refrigerators, he should be able to make at least 30% profits.
Feng Yu immediately call up Kirilenko and told him to take note of how much load the frozen river can withstand. Feng Yu wanted the trucks to carry the maximum amount of compressors. He also wants all the trucks. After that, he told Kirilenko about his idea to avoid taxes and asked Kirilenko to register a logistics company. The money for the compressors will be transferred over first, and the payments for the trucks will be transferred to another account or use other types of goods to barter.
After they had finished discussing their plans, Feng Yu asked Li Shiqiang about the procedures to set up a logistics company.
Logistic company? Li Shiqiang felt that it was weird. It should not be profitable to run a logistics company. Just the vehicles, it would be a considerable investment.
Feng Yu told him that Kirilenko wanted to sell them a fleet of obsoleted trucks which were manufactured last year, and as expected, Li Shiqiang was shocked.
Feng Yu had not expected the second generation of the Soviet Union Army would dare to do this, let alone Li Zhiqiang. But who cares. The more daring they are, the better it was for Feng Yu. If they dare to sell planes or cannons, Feng Yu will dare to buy!
Remember there used to be a lot of Gaz trucks in the Longjiang Province which was used to transport goods and ferry people.
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