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Liu Yonghao was not the decision maker . Although he was one of the founders who suggested this venture, it was still the government that has the final say .
Feng Yu was in no hurry . If this bank could wait until 1998, it would be best . It was not worthwhile to invest now . But after 1998, Feng Yu would have made a killing from the Asian Financial Crisis, and he will have lots of funds to invest .
Furthermore, Feng Yu knew that it was impossible for Minsheng bank to be set up next year . The earliest will be 1996 . He might as well let other people invest in the bank first, and he invests after 1998 . He wants to get bank loans from Minsheng Bank, but he knew this was not possible now .
Tai Hua Supermarket’s expansion still needs to get bank loans from other banks . Feng Yu in charge of contacting the China banks and Fu Guangzheng, and the rest will contact the Hong Kong banks . They will compare the interest rates and conditions before deciding to get the loan from which bank .
But Feng Yu remembered in his previous life, Li Zekai had gotten a considerable loan amount with just one project . Hong Kong side should not be a problem as Superman Li was one of the shareholders of Tai Hua Supermarket .
Feng Yu felt that funds were not the priority now . Suitable locations were their top priority . They must get it before any competitors appear .
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Currently, there were already some small supermarkets, like BHG, in China . They were registered earlier than Tai Hua Supermarket, but their scale was not significant . Their product variety, service, product display, marketing, sales strategy, etc . were far behind Tai Hua Supermarket . Although BHG also wanted to set up a hypermarket, their hypermarket was only a bigger supermarket .
Having a good location means a steady flow of customers . This was very important .
In Shanghai, BHG’s supermarket had affected Tai Hua Supermarket’s development . Although BHG only have two branches, their profits were high .
But after Tai Hua Supermarkets opened up two branches in Shanghai, BHG’s profits start to decline .
Feng Yu’s strategy was to snatch away the BHG market share . After all, BHG’s management model, product placement, supply chains, operational models could not be compared to Tai Hua Supermarket . Even their buildings were old, and wires could be seen everywhere . BHG supermarkets were messy, unlike Tai Hua Supermarkets .
The supermarket manager of the branches in Shanghai also starts to poach BHG staffs . Tai Hua Supermarket was paying better than BHG and had better benefits and prospects .
Those staff that joined Tai Hua Supermarket were told that Tai Hua Supermarket will continue to expand and there will be many more new branches set up . If they were picked to go to the new branches, they will have an increment and might even be promoted to the management staffs .
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The new branches might not be far from Shanghai . It might be in Suzhou or in Shanghai . The staffs will not need to work far from their home .
Tai Hua Supermarkets had a steady supply chain, and the products they got were much cheaper . Tai Hua Supermarket staffs will visit BHG supermarkets to check on their pricing and then set lower prices for the same products .
At first, Feng Yu thought the profits from supermarkets will not be high . It should be 20% of profits at most . But after the supermarkets were opened, the profits were much higher than expected .
A pair of stockings were sold for 10 RMB in the shopping malls . The cost of the stockings was only 3 RMB, and Tai Hua Supermarket sold it for 8 RMB . The profits almost doubled off the cost .
China’s Great Wall Red Wine was selling for over 20 RMB in most stores . But the cost price Tai Hua Supermarket got for this wine was less than 10 RMB, and it was sold for 18 RMB per bottle . Just this wine alone attracted many customers .
The profits for those imported products were even higher . These imported products were usually sold by some companies for several times profits .
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But for the same product, it was much cheaper at Tai Hua Supermarket . But the profits were still more than double the cost .
All the items in the Tai Hua Supermarket were selling cheaper than other places . Even the eggs were less expensive than the market .
Coupled with marketing, there was a constant flow of shoppers visiting the supermarkets every day . For example, the two branches in Shanghai attracted shoppers living far away . This was because the products in Tai Hua Supermarket were on average cheaper by 10% . Some items were even 20% less expensive than in other places .
The profits were not low, and the sales keep increasing . There were promotions daily, and Tai Hua Supermarkets total revenue was growing every week .
The success of Tai Hua Supermarket had a significant impact on BHG . This was what Fu Guangzheng wanted . Fu Guangzheng had set his sights on BHG supermarkets’ locations . If he could buy over those two BHG supermarkets, he can build a new shopping mall at the site . The business will surely be great . Although it will take a few months to build the new mall, the potential profits make it worthwhile, and it will eliminate one future competitor .
Not only in Shanghai . Many shopping malls in Beijing, Bing City, Tianjin, Shenzhen, Jinlin and many cities had been converted into Hypermarkets . They were trying to imitate Tai Hua Supermarkets .
For instance, two-stories of a shopping mall in Bing City was converted into a supermarket . Even the shelves, the space of the aisles, product placements were identical to Tai Hua Supermarket .
Feng Yu called Zhang Ruiqiang to ask him about this . He had wanted to buy this mall previously, and the City government refused to sell it because they wanted to have a shopping center . How come this supermarket suddenly appear?
Zhang Ruiqiang replied embarrassedly . It was his men who made this decision, and he was not aware of it . When he knew about this, the supermarket was almost set to open . All the shelves were built, and they could not remove it . Furthermore, this was only a small supermarket . It will not affect Tai Hua Supermarket at all .
Feng Yu does not mind . Tai Hua Supermarkets was able to catch up from behind even when the good locations were taken in cities like Shanghai, Shenzhen, and Guangzhou . What’s there to worry about that small supermarket?
Fu Guangzheng was also interested in the location of that mall in Bing City . He wanted to buy over the mall .
Tai Hua Supermarket had strong marketing, and many people had seen this supermarket on the news . They will want to visit this supermarket out of curiosity . Once people entered Tai Hua Supermarkets, they will realize how cheap the products were .
After the introduction of the membership and shopping cards, Tai Hua Supermarket was able to retain most of the shoppers . After Tai Hua Supermarket opened up, all the grocery shops, markets, shops, etc . nearby were affected . Their businesses were not as good as before .
The locations Fu Guangzheng and the rest scouted were mostly taken up by other supermarkets, and the solution they had was merger!