Chapter 434 – Taking a step too far
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“I shall trouble you with this, Master Lu. We shall have a chat when I am back in Beijing.” Feng Yu hanged up the phone with a smile.
Just the exhibition alone was not enough. The exhibition had given those foreign brands a chance to showcase their latest technologies. For China companies, other than The Little Tyrant and Wind and Rain brand, no other companies could stand out.
Feng Yu had wanted to see if he had missed out any gems. But China’s consumer electronics were too far behind other countries.
The closing ceremony’s performances were canceled. Those foreign companies had taken all the limelight, and we still must perform for them?
During the exhibition, the VCD, regardless of Wind and Rain brand or Aiwa brand, had attracted the attention of all the foreign companies. Feng Yu hired someone to write an article about this VCD.
This article was handed over to Master Lu for him to send to all the mainstream newspapers, like
Feng Yu had also sought the help of Kirilenko and Fu Guangzheng to use their connections with the overseas media to report on this VCD and China’s consumer electronics.
After these articles were published, lots of media paid close attention to this exhibition. Some of the foreign media had not attended this exhibition but had also written some articles regarding this exhibition.
The reports were divided into 3 perspectives. One faction said that the article that was published earlier was fake. China had been closed off to the world for so long, and their consumer electronics technologies could not be the best in the world. China must have used Aiwa’s technology and claimed to be theirs. This technology was invented by the Japanese.
These types of reports were mainly from England, Japan, Europe, and Southeast Asia’s media.
There was another faction that agreed with the earlier article. It states that China was up and rising, and China had a huge population. It would be a matter of time before China will take over the world. These articles were mainly talking about China’s threat to the world. These reports were primarily from the US media.
The last group of reports was congratulating China catching up with the rest of the world. These media were from those former Soviet Union countries and other countries that had good relationships with China. Of course, the Chinese press were the most supportive.
The strategy of using media to market their products was thought up by Feng Yu and Fu Guangzheng. They want people to believe that VCD technology will bring the world to the next era.
Coupled with aggressive advertising, they will be able to open up a market for VCD.
Fu Guangzheng told Feng Yu that advertising might help their products’ sales in the in the initial phase, but it will not let the sales grow steadily. The Fu Family had lots of experience in this area.
For example, the Learning Machine. Although the sales might seem fine for now, the overseas market’s sales were starting to shrink after the initial spike.
The Chinese market might still be growing, but there were talks that this Learning Machine was only a video game console disguised as a computer.
The Fu Family had conducted market research. If the VCD were to replace video cassette players and LD players to become the consumer’s family movie systems, it might take 2 to 3 years.
This was why Fu Guangzheng warned Feng Yu to not increase the production of the VCD players. If things were not going well, their products would fill up their warehouses in no time with the current production rate.
But luckily for them, although the sales of the VCD was not as good as they expected, it was still enough for them to break even and occupy the market. This was also a good thing.
Feng Yu knew that he was not a sales genius. He was able to come up with so many sales ideas and knew which products could make money, was because of his memories from his previous life.
Feng Yu’s memories do not include the process of how those people make money. He only knew which products would be popular and can make money. This was why he tried his best to keep all the founders of the companies, whenever he takeover or invest in those companies.
It seems that Feng Yu was conceited. He had believed too much on his memories from his previous life and had been changing history. He kept introducing products earlier than it was supposed to be. He had forgotten about the timings and the consumer’s spending power.
This resulted in Feng Yu got to think of ways to market and push the sales of these supposedly popular products.
The exhibition had ended. Wind and Rain and Aiwa VCD players’ sales were much lower than what Feng Yu had expected.
Those companies’ representatives knew that the VCD technologies patent were in the hands of Tai Hua Trading and had authorized Aiwa to use the patents. Japanese media had also found out that Aiwa and Wind and Rain’s major shareholder were the same people!
That means the VCD technologies were in the hands of one person. Many people went up to Feng Yu, wanting to get the patent authorization to develop this market together.
But Feng Yu rejected them without any hesitation!
Although with more brands, this market will be developed faster. But it will also lower his profits. Those companies’ technologies were more advanced than Wind and Rain, and Aiwa. Their brands were also more well-known than Wind and Rain. If these companies were able to develop better products, like DVD, then VCD will be replaced by DVD before it was able to flourish. This was not something Feng Yu wanted to see.
Because Feng Yu did not want to authorize other companies and had established the sales distribution channels, he cannot let those companies be the distributors for Wind and Rain VCD or Aiwa VCD. If he did that, he would breach the contract with the Fu family. Tai Hua Trading was in-charge of China’s internal distribution, while the Fu Family was in-charge of the overseas distribution.
The Fu Family was very grateful that Feng Yu did this. The was the opportunity for Feng Yu to kick the Fu Family aside, but Feng Yu did not do that.
Fu Rongjing was the only one that did not think this way. He felt that his son, Fu Guangzheng had helped Feng Yu too much. The Motor Company’s new factory construction, Aiwa electronics, Wind and Rain electronics factories were all taken care of by Fu Guangzheng. Feng Yu was the one that needed Fu Guangzheng and cannot do without the Fu family’s management team.
Fu Rongjing had hinted to Fu Guangzheng that Feng Yu needed him, and he should have asked for more shares several times. He does not need to take the shares for free. He can pay for those shares. Fu Rongjing was willing to pay the market rate.
But Fu Guangzheng rejected this suggestion. He understands Feng Yu’s character well. Feng Yu looks like he was a generous person, but in reality, he was very stingy. If he made this request to Feng Yu, it would be best if Feng Yu agrees. But what would he do if Feng Yu disagree? Withdraw from all these companies?
Although Feng Yu would suffer huge losses if Fu Guangzheng withdraws from those companies. But it will not hurt Feng Yu. Feng Yu can just let the middle management staffs take over the crucial roles in the company, while he poaches people from other companies with high salaries. Fu Guangzheng will be the one that will lose the opportunity to follow Feng Yu to make money. He will be at the losing end.
Fu Rongqi also felt this way. He reminded Fu Guangzheng to try and build a closer relationship with Feng Yu.
Feng Yu looked at the August VCD sales report. It was not up to his expectation. He can’t help but sigh. He had taken a step too big…. He had shot himself in his foot!