Sail across the sea

Chapter 380 has no shortage of manpower.

"Old Yin, aren't you in the department store wholesale business in Cangtang? How come you've expanded your business to Zeshan?"

Gao Fan changed the subject from Renqiao to Yin Xiaobiao's business.

Yin Xiaobiao didn't want to dwell on that topic either; some things are better left unsaid, as talking about them too much only makes them seem pretentious. He picked up a small fried fish from the table, popped it into his mouth, chewed it, swallowed it, and then said:

"I handed over the department store wholesale business to my younger brother. He graduated from high school this year. Like me, he wasn't academically inclined and didn't get into university. After two years in the department store business, I got a bit tired of it, so I came to Zeshan to do some new business."

"What kind of new business?" Gao Fan asked.

"I collect scrap," Yin Xiaobiao said.

"Collecting junk?" Gao Fan thought for a moment, nodded and said, "I have heard people say that you can make money by collecting junk. I think there was a man in some place who made ten thousand yuan. He was nicknamed the 'King of Junk'."

He said this simply to echo Yin Xiaobiao's words. He didn't know much about the scrap metal business. The legend of the "Scrap Metal King" was something he had heard in his later life, and he wasn't sure if such a saying still existed.

However, since Yin Xiaobiao was already doing this, he couldn't very well discourage him, so he could only casually agree with him.

Yin Xiaobiao sensed the perfunctory tone in Gao Fan's words and said with a smile, "Gao Fan, I know you're good at technical things, but you probably don't know much about businesses like selling small commodities or collecting scrap now, do you?"

Gao Fan laughed and admitted, "I really don't know. It's like being in a completely different world. So, is the profit margin for scrap metal recycling very high these days?"

Yin Xiaobiao said, "If you operate like a state-owned scrap metal recycling company, there's actually not much profit. Let me give you an example: do you know what the current purchase price of scrap copper is?"

Gao Fan thought for a moment and realized that he did not have such knowledge in his memory, so he shook his head to indicate that he did not know.

Yin Xiaobiao said, "Now, recycling one jin of scrap copper is worth 2 yuan; recycling one jin of brass is worth 1.5 yuan."

"and then?"

“Some factories sell their scrap wires and copper wires to scrap yards at this price. But if these wires and copper wires can be transported to Renqiao, the price can increase threefold.”

"Oh?"

Gao Fan was slightly taken aback, but then he understood the reason.

In fact, Yin Xiaobiao's narrative already contained many clues. He deliberately emphasized waste electrical wires and waste copper wires, which meant that these things were not waste copper, but could be used as industrial products.

For example, during factory equipment maintenance, some old electrical wires are replaced. These wires aren't necessarily unusable, but they've been used for too long, and the outer insulation has aged, posing a risk of electrical leakage. From a safety perspective, these wires need to be replaced. The factory doesn't reuse the old wires; they're usually sold as scrap to scrap metal yards. The scrap metal yards then strip the copper core from these old wires and sell it as scrap copper to smelters as raw material.

However, the situation was different in Renqiao. Renqiao had a large number of private enterprises, and under the planned economy, they had difficulty obtaining state supplies and could not buy electrical wires through normal channels.

At this time, if someone were to sell discarded old electrical wires from state-owned factories to Renqiao, they could at least earn much more than they would from selling scrap copper, even if they couldn't sell them at the price of new electrical wires.

As for whether using such old electrical wires poses any safety hazards, firstly, users would take some safety measures, such as using relatively intact parts in places where people might come into contact with them, and hiding damaged parts in concealed places, thus eliminating concerns about leakage. Secondly, in those days, the safety awareness of township enterprises was much weaker than that of state-owned enterprises, and people really didn't care about such risks.

To give a familiar example, in this day and age, many people live in houses, including some rural primary school buildings, which are considered dilapidated, but who cares? In one of our South Asian neighbors, trains allow passengers to hang on while standing, which has become a unique sight, hasn't it?
For the poor, concepts like safety and environmental protection are luxuries.

Yin Xiaobiao realized that Gao Fan had understood his meaning, so he continued, "Renqiao has a large supporting market, which mostly sells second-hand goods. Renqiao is short of everything, and anything that is still somewhat useful can be sold there."

"For example, you can see old nuts everywhere in the factory, the kind that are rusty. The scrap metal recycling station will recycle them as scrap iron, and they'll only get a penny per pound. But if you take them to Renqiao, you can sell them individually. The big ones will get three to five cents, and the small ones will get one or two cents. You can do the math and see how much money you can make from a pound of nuts."

"But sorting these nuts by size and removing the rust might be quite costly, right?" Gao Fan commented.

"What farmers have in abundance is manpower," Yin Xiaobiao said, revealing the secret.

One of the most important reasons why China's township and village enterprises were able to rise to prominence and defeat many long-established state-owned enterprises was their exceptionally low labor costs.

Farming is seasonal. During the busy season, they work from dawn till dusk, with the whole family pitching in. But during the off-season, they have nothing to do and spend their days squatting at the village entrance, chatting and joking, wasting time.

Someone once summarized a farmer's life throughout the year like this: one month for the New Year, three months for farming, and eight months for gambling.

In such situations, if someone offers them a job, even if they only earn a few cents a day, they would be willing to accept it.

Since I'm just idling around anyway, what's wrong with earning a few cents?
“Labor costs are already quite high in Renqiao,” Yin Xiaobiao said. “I’ve hired some people in my hometown to dismantle and clean scrap materials. Like you mentioned, I’m doing the old nut rust removal now. I’ve even set up a small workshop to remove rust using chemical methods. Although I’m not as good at studying as you guys, I at least went to high school, so I still remember this basic chemistry knowledge.”

Gao Fan said, "That's good. If you encounter any technical difficulties, you can come to Canghua Science and Trade Center for help. I'll tell you a few names later, and you can contact them. We at Canghua Science and Trade Center have engineers hired from the Provincial Chemical Engineering Design Institute, and professors from Peking University are also doing research there. Our technical strength is very strong."

"At that time, you just need to pay a small technical service fee. Ten or eight yuan is fine, three or five thousand is fine too. It all depends on how much you think the technology is worth."

"That's wonderful!" Yin Xiaobiao's eyes lit up. He picked up his wine bowl again and said, "I have to thank you again. You've done me a huge favor once more."

(End of this chapter)