industrial lord

Chapter 570 Please come and build a factory

While Adly was watching several big men helping Shi Tou put on his armor, Frederick was attending a banquet at the residence of the Grand Duke of Milan.

This is an informal buffet-style banquet, which is becoming more and more acceptable in high society as everyone has a chance to talk.

Before the banquet began, Frederick and Archduke Edwards of Milan had a private chat in the study.

After talking about the weather and local customs, Edwards asked Frederick: "Do you think Milan is a suitable place to make a fortune?"

Frederick replied: "I only have a superficial understanding of Milan, but I have already felt the enthusiasm of the people here."

He was talking about the responses he got after asking the businessmen in the pub last night if they were willing to invest in some industry, but Edwards thought it was the girls who ran to his place last night and came out at noon today, with smiles on their faces that could only be understood but not expressed in words.

Frederick pretended not to see it and continued, "The most profitable industries are always those that people cannot live without, such as clothing, food, travel, and daily necessities."

Edwards agreed, saying, "That's true. These businesses are open to everyone, so many people do them. Although each person may not make much money, the profits of the entire industry are terrifying."

Frederick added: "The introduction of a new industry will lead to a new problem. Have you heard about the burning of Wessenbowl?"

Edwards nodded and said, "I heard that cheap and high-quality Wessen cloth and clothes have bankrupted weavers and many tailors in the Rhine River Basin. This has also happened in Milan. Now no one in the coastal and riverside areas of the Kingdom of Sardinia weaves their own cloth, and ordinary clothing tailors are having a hard time."

“There were some disturbances at the time, but they were quickly suppressed.”

The gap in strength between ordinary people and the landlords' armed forces is huge, so there is no possibility of rebellion at all. If a rebellion gets out of hand, it is basically because someone is pushing it from behind.

In traditional feudal manors, the homespun cloth woven by serfs and tenant farmers was part of the tax revenue and an important source of income for small landowners. The emergence of Wessen cloth damaged the economic interests of small landowners.

But the people selling Wessen cloth were big landowners, and they had bigger fists, so the situation soon calmed down.

Frederick had learned about this aspect and said, "My philosophy is that everyone can get rich together in harmony."

"The root cause of this kind of unrest is economic problems, and to solve it thoroughly we need to start with the economy."

Edwards asked seriously, "How can I solve this problem? Please teach me."

Frederick said: "Goods must be sold to generate profits."

Edwards nodded. Milan was a city with developed business, and there were many cases where companies suffered huge losses due to transportation problems.

Frederick continued: “The buyers are not just the wealthy people, such as nobles and merchants, nor are they just the citizens and gentry in the cities who have more money, but also the farmers, who make up 90% of the population.”

"The farmers were very poor. There was a family in our area whose quilt was hundreds of years old. It had become a pile of rags, but they still used it to keep warm in the winter."

“If farmers’ incomes were higher, and even a family could afford to buy a new piece of clothing a year, how big do you think the clothing market would be?”

Edwards immediately began to calculate in his mind.

The Kingdom of Sardinia had a population of about 1000 million. Assuming 900% of the population was agricultural, there were 5 million people. Assuming each household had five people, there were 180 million households. Even if only one in ten households bought a new piece of clothing every year, that would mean 18 pieces of clothing would be sold each year.

Edwards rang the bell at hand, and the butler rushed in with the servants and gave him a bottle of blood pressure-lowering medicine.

Frederick also wanted to have a piece of this meat, but there was no way. The huge market in the north had made the garment factories run in three shifts. Many families bought sewing machines, and housewives took on piecemeal work at home. The prisoners in the prison who could not repair the roads worked in two shifts every day and their sewing machines were burned out, but ready-made clothes were still in short supply.

So he has been dividing up the garment factories, while holding on to upstream materials such as cloth and thread, as well as machines. He really doesn't have the energy to earn the money from operating the sewing machines.

According to Frederick's plan, once the railway is completed, the cotton from the south can be transported to the Duchy of Wessen via the railway of Porto Ferdinand in the Osmaga Empire. After being woven into cloth, it can be transported by railway through the White Mountains to be made into clothes in the Kingdom of Sardinia. Some of these clothes will be produced locally, and some will be sold to the southern continent.

Edwards sat in a chair with his eyes closed, waiting for his blood pressure to drop. At this time, his butler came to report that it was time for the banquet to begin.

"No time." Edwards waved his hand. "We are negotiating a business worth tens of thousands of ore a year. If they are hungry, they can eat first. They don't have to wait."

Frederick smiled and took a sip of tea. He hadn't agreed to anything yet, but he had released the news. Edwards was smart and quickly asked the key question: "How can we get farmers to buy clothes?"

Frederick smiled, put down his teacup, and replied, "Just now we said that the cloth woven by farmers at home cannot be sold. Why do they weave cloth? The key is that it is difficult to make a living by relying solely on the output of the land."

Edwards said: "It is true. This problem is more obvious in the mountains in the south. Many people come out to work as mercenaries."

The mercenaries of the Kingdom of Sardinia were quite famous. They were good at using crossbows and defending.

Frederick knew them well because the Black Claw Gang had successfully opened up this market and had forced them to replace their crossbows with double-barreled shotguns.

"Increasing farmers' income is a big issue," Frederick said. "I won't talk about the tax issue. It's beyond my control."

"In addition to tax reforms to increase farmers' income, I also vigorously developed magical fertilizers, improved seeds, intensive farming, and magical pest control to increase crop yields."

Edwards said somewhat depressedly: "I originally had a lover who was a necromancer. Although she was not very beautiful, she was very gentle and spoke well."

"As a result, she received a letter from a classmate three years ago, and then she came to you to study magic that kills insects but not plants."

"I heard that she got married there recently."

Frederick didn't expect him to bring this up and just smiled.

It is rumored that there is one stone for all necromancers in the world, and the Principality of Wessen has eight of them, with two more on the way to the Principality of Wessen.

Frederick said: "I can sell improved seeds, fertilizers and farming machines to the Kingdom of Sardinia to increase the output of agricultural products."

"Our practice has shown that the first thing farmers buy when they have money is clothes."

While promoting the garment factory, he also further promoted seeds, fertilizers and agricultural machinery, which are all high-tech and high-profit industries.

Edwards is no stranger to farm machinery such as tractors, and has purchased several of his own.

However, due to the transportation costs, the final increased profits from improved seeds and fertilizers were limited and were not very popular in the Kingdom of Sardinia.

Things will be easy once the railway is opened. Transportation costs will decrease and profits will increase, and the final profit will be quite considerable.

Edwards thought for a long time and finally said sincerely: "I invite you to build a clothing factory in Milan."

"I think it makes sense to increase farmers' income, and I will be responsible for this."

Frederick replied: "There is no problem in principle with building a garment factory, but the specific form of cooperation needs to be discussed."

"There are many kinds of clothing. My suggestion is to build different factories, each producing one kind of clothing, to avoid unnecessary competition."

Edwards agreed.

Frederick continued, "In the first cooperation model, investors from the Duchy of Milan go directly to the Duchy of Wessen to purchase equipment and build their own factories. I have no involvement except for providing discounts."

"The second cooperation model is that the Duchy of Milan provides the land, and I come here to build a factory and recruit workers with full capital. However, there is no income here except for the land use fee, taxes, and the workers' wages and taxes."

"In the third cooperation model, I will invest 30% of the value of the machinery and equipment, and the rest of the investors can invest in land, funds, etc., and eventually we will get dividends according to our shares."

"If it's the third mode, I have a condition. A foolish general can destroy an elite army. The same is true for a factory, so the factory managers must pass the industrial manager qualification certification exam of the Principality of Wessen."

Edwards did not give an immediate answer, saying the matter needed to be discussed with others.

Frederick is not in a hurry, so let's go to the banquet first.

(End of this chapter)