Chapter 183 – Distributors Part 2
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When Feng Yu stood up, everybody kept quiet. A few newcomers still wanted to say something, but they saw their friends signaling to them to shut up.
Feng Yu was pleased with their attitude. Those newcomers still do not know the person-in-charge here!
“There are some of you who had arrived early and saw what happened at Bing City’s sales location. All of you can tell that the motorcycles are selling like hotcakes. Songjiang Motorcycles are 125 CC, and it is the most powerful bike allowed in China currently. We have the abilities to manufacture bigger bikes. When the government relaxes the regulations, we will launch the bigger bikes immediately. We have all the related the technologies and machines to produce them now. From the technologies to the exterior designs and the marketing strategies to the pricing. These are all our capabilities. What else are you all worrying?”
“Manager Feng, when the motorcycles are newly launched, we would not have any problems hitting the quota of 400 units per province. But as time passes, the market would be full. It is just like the electric fans. The sales are good at the start but slowly decline as time passes. We tried our best, but the market is just so big. Furthermore, motorcycles are not like electric fans and not every family can afford.” Someone shouted.
“Fine, then I will offer all of you another contract. The quota will be 300 units per month, but the commissions will also be lowered according to the proportions. The percentage of the commissions will be lowered by 1% for every 100 units. Will you all accept it?” Feng Yu smilingly asked.
The person who had shouted kept quiet. 1% less commission would mean lesser profits. Now the commissions were already not high and if it wasn’t for the base earnings were slightly higher, they could not attract any agents.
“Manager Feng, we had worked together multiple times. From the electric fans to the not so popular fridges, we had been working with you. Can the deposits be lesser? 100,000 RMB should be enough to show our sincerity?” A longtime customer asked.
“You can buy the bikes straight from us, and if you are willing to buy from us, I will earn lesser and sell it to you at 14,000 RMB per unit, and it will be in multiples of 100 units.”
This person also kept quiet. Even if Feng Yu let them get more profits, 100 units will also cost 1.4 million. If they could fork out so much cash, then would they be bargaining about the 500,000 RMB deposits?
“All of you do not want to buy the bikes up front. Do you know how much cash flow pressure my company is facing? Have all of you calculated? There are over a dozen people here and if each of you is the distributors for a province, every month will be over ** units. How much must I pay the Machinery Company? All of you think carefully. I am only collecting 500,000 deposits from each of you. Is it really a lot?”
Feng Yu was talking crap again. He does not need to fork out a single cent when he gets the bikes from the Machinery Company and only needs to pay them at the end of the month. Deposits for the bikes? Every province’s deposit was 500,000 RMB and after paying the Machinery Company, what about the remaining?
Tai Hua Trading was the main distributors for Songjiang Motorcycles, and Feng Yu had signed a contract with Li Mingde. He could get the bikes at 11,000 RMB per unit, and anything extra would be Tai Hua Trading’s profits.
Of course, if Tai Hua Trading could not achieve the target set, Tai Hua Trading got to repay the Machinery Company 500 EMB for every unsold bike and the all the advertising fees which included the CCTV advertising slots and the payment for the commercials.
To Li Mingde, Feng Yu was digging his own grave, and he wanted to teach Feng Yu a lesson. This was to prevent Feng Yu from interfering with the management of the Machinery Company. You want the distribution rights of the motorcycles? Dream on!
At first, Li Mingde had wanted to wait for Feng Yu to fail and see if the Feng father and son would still dare to go against him in the company. But after he saw Bing City’s sales figures, he knew that Feng Yu might really succeed. Li Mingde was now thinking of ways to stop Feng Yu. It would be best if the number of units sold stayed at 129,000 units.
“Anyone else has questions?” Feng Yu looked at everyone in the room. All of them were looking down.
“No more questions? Then I will add some conditions. I don’t care if any of you are doing wholesales to agents or use the commission structure to develop your downline. Within this month, there must be at least a showroom set up in your province city, and by year-end, every city must have a showroom. You will be fined if you are unable to do it!”
Fine? Everybody’s expressions changed. They too wanted to sell more bikes but if getting a fine for not selling well was too much!
“Secondly, the retail price must not be higher than 19,800 RMB. This price is lower than the imported 125 CC bikes, the distributors would still have profits and would not affect our motorcycle sales. We had already aired advertisements on CCTV and later, we have a series of promotional activities. I guarantee our brand awareness will increase. If any of you dares to increase the retail price, don’t blame me for removing you as the provincial distributor and still fine you!”
The distributors’ brows were knitted even more. Fine again?
Manager Wu should be doing the talking. All the things he said were all excellent, reward systems, benefits, etc. How come everything this Manager Feng says was all involving fines?
Wu Zhigang saw the distributors’ face changes color and he was anxious. However, he dares not to voice out. In his heart, he was pleading Feng Yu to stop talking about fines. If he carries on, there would be no distributors left. Do Feng Yu really want them to set up sales locations in every province? Where would they get the energy to do that?
“Thirdly, every province will be rated according to the economic status and population and the province with the lowest sales for that year will also be fined!”
The distributors’ faces were all blacked. Other than fines, can’t you say something else?
“Why? All of you can’t accept getting fines?” Feng Yu smiled and asked.
All the distributors nodded. Who can accept so many conditions and fines?
“Fine. Those that can’t accept those conditions can leave, and we will carry on the discussions with the ones remaining.”
Damn. This again. All the distributors were speechless. But this method was still very useful. At their respective provinces, many people were asking for Songjiang motorcycles, and the distributors had already contacted their agents and downlines. When they receive the bikes, they will distribute to their agents at different cities.
If they leave now, then the preparations efforts they did would be wasted. Furthermore, all of them knew that being the distributor for Songjiang Motorcycles would be profitable.
Even if they sold only 400 units per month and the commissions were 5%, they would also get at least 750 RMB per unit, and if they sell more, they will get more profits.
All of them had calculated and was clear that this was a profitable business. One province, 4,800 bikes was something achievable!
“No one wants to leave? Then Southern Guangzhou, Beijing, Shanghai…… provinces can go to Manager Wu to sing the contract. The other provinces come to me one by one to discuss the terms.”
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