bookrandom Chapter 653 It's settled then.
Chapter 653 It's settled then.
“Earning 20 million in five years does sound tempting. But what if the market in East China changes? What if we can’t capture the market?” Li Xiangyang asked cautiously.
Tian Guoqiang was puzzled: "Xiangyang, what's wrong with you? You weren't this conservative before."
Li Xiangyang gave a wry smile. He was certainly not conservative, but he knew the dangers of blind expansion.
“Guoqiang, think about this,” Li Xiangyang said, sitting back in his chair. “Our current factory is operating well, making a stable profit of three million every year. If we invest ten million to build a new base, and it fails, not only will our initial investment be wasted, but we might even lose our current factory.”
Lin Yajing nodded: "Mr. Li is right. Every investment carries risk, and we do need to consider it carefully."
"So you mean we're not going to vote?" Tian Guoqiang asked anxiously. "This is a once-in-a-lifetime opportunity!"
“It’s not that we won’t invest,” Li Xiangyang thought for a moment, “I suggest we take a step-by-step approach.”
"How should it be broken down into steps?"
"Our first step is to utilize our existing factory capacity to meet the demand in East China as much as possible," Li Xiangyang said. "If sales are as good as General Manager Lin expects, then we'll consider expanding production."
“But the existing production capacity is simply not enough,” Wang Ergou reminded him.
“So the second step,” Li Xiangyang continued, “is to build a small production base first, with an investment kept under three million. If this small base operates well, we can gradually expand the scale.”
Lin Yajing considered it for a moment: "This approach is relatively safe, but it might cause us to miss the best market opportunity."
“Then we need to find a balance between caution and opportunity,” Li Xiangyang said. “President Lin, could Hualian Supermarket give us six months? If our small base operates smoothly after six months, we can then invest in building a large base.”
Lin Yajing frowned: "Six months...that's a bit tight, but not impossible. I need to go back and discuss it with headquarters."
Just then, the sound of a car came from outside the door.
Wang Ergou walked to the window and looked out: "It's Manager Chen from the Science and Technology Development Bank again."
Li Xiangyang was somewhat surprised: "Didn't he say he'd give me an answer tomorrow? Why is he asking again?"
Soon, Chen Ming was brought into the office.
"Mr. Li, I'm sorry to bother you again." Chen seemed a little impatient. "I just received a notification from head office saying that other banks are also in contact with you, so I came here specifically to confirm."
Li Xiangyang was taken aback: "Other banks? We didn't contact any other banks."
“That’s right,” Chen Ming explained, “From what I understand, the Industrial and Commercial Bank of China in the provincial capital also sent people to the county this morning, apparently specifically for loan services targeting agricultural product processing enterprises.”
This news surprised several people present.
"Manager Chen," Li Xiangyang asked, "can your bank further optimize its loan terms?"
Chen Ming thought for a moment: "The interest rate is already the most favorable, but regarding the credit line, if Mr. Li really needs it, we can consider increasing it to fifteen million."
Fifteen million!
This figure made Tian Guoqiang's eyes light up: "Xiangyang, now we can invest in a large-scale base with peace of mind!"
But Li Xiangyang remained calm: "Manager Chen, what is the loan term?"
"A ten-year term, with interest payments only for the first three years, and principal repayments starting from the fourth year."
This offer is indeed very tempting.
Li Xiangyang glanced at the people present, weighing the pros and cons in his mind.
A loan of 15 million is enough to build a large production base. However, the debt burden will also increase accordingly.
“Manager Chen,” Li Xiangyang finally said, “we need time to consider it. Can we give you an answer in a week?”
"A week?" Chen Ming hesitated. "Mr. Li, bank policies change very quickly. I'm worried that if it drags on, the conditions might change."
“Those three days,” Li Xiangyang conceded. “We’ll give you a definite answer in three days.”
“Okay, three days it is then.” Chen Ming put away the documents. “President Li, this is a rare opportunity, I hope you will consider it carefully.”
After Chen Ming left, the office fell silent.
“Xiangyang,” Tian Guoqiang couldn’t help but say, “what are you worried about? The orders from Hualian Supermarket are there, and the bank’s loan terms are so favorable, what’s there to hesitate about?”
Li Xiangyang did not answer directly, but walked to the window and looked at the busy workers in the factory area.
Some of these workers were recruited from the village, while others came from other places. They trusted the factory and Li Xiangyang, entrusting their lives to it.
If blind expansion fails, it won't just be him who suffers, but also the workers who depend on the factory for their livelihood.
"Guoqiang," Li Xiangyang turned around, "do you still remember Ma Qingfu?"
"That fat guy who buys mountain produce? I remember him." Tian Guoqiang didn't understand why Li Xiangyang suddenly brought him up.
"Back then, he almost lost all his capital due to reckless expansion," Li Xiangyang said. "In the end, we had to give him a hand, and he finally recovered."
Tian Guoqiang seemed to be thinking: "You mean..."
“What I mean is, in business, you can’t just look at immediate profits; you also have to consider long-term risks,” Li Xiangyang said. “Our factory is operating very well now, and our employees have stable lives. Why risk everything on an uncertain future?”
Lin Yajing listened quietly without saying a word.
After a moment, she spoke up: "Mr. Li, I understand your concerns. But I feel that sometimes not taking any risks is the biggest risk itself."
"How to say?"
“The agricultural product processing industry is becoming increasingly competitive. If we don’t expand our scale and maintain our competitive advantage, we are likely to be overtaken by other companies,” Lin Yajing said. “At that point, we won’t even be able to maintain our current market share.”
These words made Li Xiangyang fall into deep thought.
Indeed, in fierce market competition, stagnation often means regression.
“Alright,” Li Xiangyang finally said, “let’s first resolve the immediate Hualian order, and at the same time carefully study the market research report. If the data indeed supports building a large-scale base, then we’ll make a decision.”
"What about the plan for a small base?" Wang Ergou asked.
“We can start with a small-scale facility,” Li Xiangyang said. “Invest three million to build a highly automated production line. This will both increase production capacity and allow us to accumulate experience in large-scale production.”
Tian Guoqiang and Lin Yajing exchanged a glance and nodded.
"Then it's settled," Tian Guoqiang said. "I've already found a good location for the small base in the county; the price is reasonable."