1988: Back to the human world for a few years

Chapter 354 The second time

Unlike foreign trade projects in other regions, China's trade with the Bear Country at this time existed in both the form of "cash settlement" and "barter".

To put it simply, if you are an ordinary trader and your trade volume is not large, then if you are lucky, you can use the cash-for-goods settlement model and get a fairly substantial amount of rubles or dollars... Of course, in view of the serious depreciation of the ruble in recent years, traders often ask the other party to pay in US dollars. If the other party insists on paying a mixture of US dollars and rubles, they will also exchange the payment for some popular domestic products, and then pull them back to make another profit.

But if the trade volume is relatively large, and the partner you are dealing with is relatively long-term, then I'm sorry, unless you are an official, or the materials are particularly sensitive and important, barter is basically the only option for you.

Thus, within the scope of large-scale trade, a clear value circulation route has emerged: collect or produce light industrial products such as alcohol, food, medicine, clothing, consumer electronics, etc. that are in short supply in the Bear Country from the domestic market - the Bear Country will exchange them with you in rubles, US dollars, and almost all materials and goods including heavy industrial products that you like but are within the tolerance range - after these materials are shipped back to the country, they will either be directly distributed to various places, or the total price of the materials will be settled to you after unified pricing through certain channels.

Given Miss Mu's family background, the goods exchanged in trade with the Bear Country would naturally be handed over to certain channels for unified pricing and settlement, rather than being like some big traders who play both sides and make several times the profit in one go.

In other words, the actual gross profit margin of Miss Mu's trade line is only about 150% to 200%, which is far from the 500% or more gross profit margin of double-ended trading.

This is also an important reason why the purple candy project was not explained to foreign investors as a production project prepared for foreign trade with Russia... Due to the characteristics of its taste, the sales channel for this thing is extremely narrow. Currently, there is almost only one sales channel, which is Russia. The characteristics of the project have many similarities with those of "hidden champion enterprises". In order to ensure sufficient profits, the company has almost no other choice but to raise prices.

If an outside investor invested in this project without knowing the truth, and with Miss Mu holding them hostage, it would be wishful thinking for you to raise the price after knowing the real situation. You would not even be able to develop other distributors and could only supply directly to the designated foreign trade companies.

The reason is very simple. At that time, the range of goods used for exchange by the Bear Country was very wide, and there were some things that were not suitable for public announcement. Otherwise, why do you think Dongying was "not doing its job" and using its own seaport to create several northern trade routes, and then let Mu Liya, the second-generation eldest lady, be responsible for one of them?
Say hello to the relevant units and issue a notice... I'm sorry, from now on, your food factory, which produces purple candy as its main product, will have to be subject to supervision.

Anyway, in the eyes of Yang Mo and Miss Mu, this is something that is beneficial to China. As long as you are given enough profit, even if you are tricked at the beginning, there will be no psychological burden at all... After all, you are a Chinese businessman, and the motherland needs you now?

But if this project is raised internally through incubation, it will be completely different.

You have to know that if this project is carried out according to the model of the previous edible rose planting project, then the responsible parties of this food factory will be the villagers, and the upstream supply units of this food factory will also be the villagers... This is completely different from the purely commercial operation model of a factory built by foreign investors.

Since we are copying the internal incubation model of the edible rose planting project, these villagers have to organize production spontaneously, right?
Since the previous internal incubation model is copied, the cooperative spontaneously formed upstream of the purple sugar factory to be responsible for processing raw materials such as peanuts and maltose must supply them to the food factory at the internal cost price, right?
In this way, the selling price and gross profit margin of purple sugar are not only related to the profits of the food factory itself, but also the profits of each unit in the entire chain... This is originally a model where everyone suffers when one suffers and everyone prospers when one prospers.

A self-financing model like this, which is somewhat retro, will be sufficiently competitive if it encounters a product with a broad market space and a good organizational manager, even if the product is in a red ocean market. After all, this model has, in a sense, reduced various costs to the lowest level.

But success and failure are both due to the same person. When this model was applied to Miss Mu's barter foreign trade project against the Bear Country, the drawbacks became apparent.

It's very simple. In order to prevent some chaos from occurring, Miss Mu's foreign trade line has an independent supervision team and an audit team. There are also strict standards for the cost review of various self-supplied foreign trade goods.

These standards are very simple and crude... Simply put, foods like purple candy can only leave a gross profit margin of 30% for the company.

Do you see the difference?

This one-size-fits-all rule actually takes care of those tertiary industry enterprises with low levels of production cost control so that they won't starve to death; but it is not friendly at all to the enterprises that can truly control costs.

For purple candy, the cost of producing a box of purple candy for an ordinary tertiary industry enterprise is 80 yuan. If a 30% gross profit margin is to be retained, the internal purchase price must be 125 yuan.
If it is a self-funded sugar factory, the cost of producing a box of purple sugar may be only 50 yuan. After retaining a 30% gross profit margin, the internal purchase price is only 71 yuan.

Purchase price difference of more than 40%!
This is a typical case of failing the harder you try!
How do you expect Yang Mo to explain to the villagers that the actual profit should have been twice that of ordinary tertiary industry enterprises, but the actual net profit was only half of that of them?
Farmers are already owed a lot in this era. Now, because they trust you, they are willing to invest their land, savings, manpower and other assets into the project at a transaction cost that is close to zero, regardless of the cost. But in the end, they get such a result... Is this what people should do?
Of course, there is another reason that is not known to outsiders...

If purple candy can really open up the market in the Bear Country, Dongying does not want to see any changes in such designated products.

If the investor is an ordinary investor, then there is nothing to say. There are a series of restrictions and rules. If you are asked to increase production, you increase production; if you are asked to reduce production, you reduce production. The internal purchase price is set at that price. You have no room for resistance. Otherwise, you will suffer the consequences.

But if it becomes a self-raised project, the main responsible parties will be a large number of rural people. Not only will it be difficult for Dongying to be too strong, but if any conflicts really arise, Dongying may get into trouble if it is not careful.

To sum it up in one sentence…it’s easy to get out of control!

But Yang Mo did not say anything about this.

………………

After hearing Yang Mo's explanation, Tugou couldn't help but frown.

Due to the nature of her work, she has actually always been on the edge of the state-owned enterprise system, and is closer to the market and the countryside.

She knew that many units had problems with rigid thinking and snap decisions; she also knew that those well-behaved guys in the office always liked to be lazy and take a one-size-fits-all approach;
And everyone’s point of view is... no matter whether these decisions are made with good intentions, when they are implemented, there will definitely be a lot of messy things.

But only after she experienced it herself did she realize how bad this one-size-fits-all approach was.

However, she was unwilling to give up such a good opportunity.

This was a project with an estimated total investment of 740 million yuan!

This number might be just an insignificant small number to those who are used to hearing about hundreds of millions of dollars all day long, but she knows that in this day and age, an investment of more than 7 million is already a very large project.

She herself was born in the countryside and knows the situation in the rural areas of Qi and Lu very well.

Although from last year to now, under Yang Shidan's management, the lives of many villages and villagers have gradually improved... but that is far from enough.

Qilu is a populous province. The population found in the census alone is 8500 million. If someone told her that the actual population of Qilu has exceeded million, she would not feel strange at all.

Among these 8500 million people, at least 6000 million live in rural areas... In this era when the total GDP of Shandong is only a little over 1500 billion, one can imagine the enormous pressure in rural areas and how difficult it is to make a living.

Although the project is worth 740 million yuan, and it is also targeted production, it can only drive employment for one or two thousand people in the upstream and downstream industries. Compared with the rural population base of tens of millions, it is not even a drop in the bucket, but...

After quickly calculating the approximate cost of purple candy in his mind, Tugou suddenly raised his head and said, "Sister Mu, after this purple candy project goes into production, can we achieve an internal output value of 500 million per year?"

Mu Liya hesitated for a moment and said, "It depends on whether this substitute product will be accepted in the market of the Bear Country. If everything goes well... at least the internal output value of about 600 million can be achieved."

Although Yang Mo is optimistic about the market prospects of this purple candy, she has been in charge of foreign trade business for more than a year and now maintains a cautious attitude towards any export project, so the reported figures are not high.

"600..."

Tugou, whose math grades were not very good, struggled to calculate in his mind: "That means I can get at least 50 yuan in net profit a year?"

Mu Liya moved her lips, and she really wanted to say that if she followed your model, a net profit of 50 per year was just an ideal value. After all, the price fluctuations of raw materials are still relatively large. In addition, at the beginning of the factory construction, some uncontrollable small changes are inevitable in the production and management process. In fact, an annual net profit of around 38 to 42 is a more reliable range. However, for some reason, she couldn't say this number, and finally just nodded slightly.

Seeing Mu Liya nod in approval of the figure he had come up with, Tu Gou became somewhat happy: "50 yuan a year, based on 2000 workers, then... everyone can get 20 yuan a month, right?"

If we follow the model of the edible rose planting project, every village and every villager will be a small shareholder, with only dividends but no salary. Therefore, based on 50 yuan per year, the income is indeed only 20 yuan per month.

Hearing this horrible figure, Mu Liya turned her head away in embarrassment, and then added: "If Yang Mo's guess is true, and purple candy will be very popular in the Mao Xiong country market, the income will definitely be more than this."

Tugou nodded: "I believe in Yangshidan's judgment, but... even if it's 20 yuan per month, I think those fellow villagers will definitely be willing to do it... Sister Mu, I still want to get your consent to turn this project into a self-funded project!"

!!!

Mu Liya looked at her in disbelief: "Why? Don't you realize that the policy in Dongying is not conducive to this self-financing model?"

What she actually wanted to say was, what can you do with 20 yuan a month these days? Even if you ask a dog to do the job, even the dog would think it’s too little… These 20 yuan are your entire monthly income, with no benefits or bonuses. Even if there is a production safety problem, you may not even be able to afford medical expenses.

After thinking for a while, she added: "If you really want to try to raise funds for the project yourself, why not split up the upstream raw material production cooperative and supply you with goods at the market price? Then reduce the scale of employment in the food factory to 800~1000 people? Anyway, it's only 600 million internal annual output value. 800 people are basically enough for such a small task... Moreover, this will not only raise the internal purchase price, but this series connection model will also increase the per capita income to more than 40 yuan/month. Although it is still not much, it is better than 20 yuan/month." Tugou classmate certainly knew what Miss Mu meant by "series connection model" and shook his head: "I know very well that as long as the accounting staff in Dongying are not so poor in business, such a superficial related transaction cannot be concealed from them, and it will also cause trouble for you, Sister Mu... No need."

At this point, Lu Yingying raised her head and looked at Miss Mu seriously: "I know Sister Mu is doing this for my own good, but... Sister Mu, after all, you have never lived in the countryside, and you don't know what an income of 20 yuan per month means to the current rural areas of Qilu."

"Perhaps for those of us who have worked in state-owned enterprises for a long time, there are no holiday benefits, no labor insurance, no quarterly bonuses, no year-end bonuses, and only 20 yuan a month. It is really a job that no one would even look at. But for rural people today... this is already a very good income, so I believe that if we raise funds on our own, this project can still be started!"

Upon hearing this, Mu Liya exclaimed: "How is this possible!?"

Tugou smiled and said, "Is it impossible? No, it is very possible!"

At this point, Lv Yingying sighed, "Sister Mu, the villages in Linyi County are close to drilling companies and Linpan Oil Production Plant, or there are often well crews digging wells near their villages, so they have some messy income and livelihoods to supplement their income. So if you say that they don't value this 20 yuan a month, it's basically true."

“But what about rural areas in other regions?”

"Do you know how much the real income of a normal family in the current rural areas of Qi and Lu, who works hard all year round on their two mu of thin land, would be after paying the public grain tax and the three unified five levies? ... Don't look at the data in the documents, as they are not truly useful for reference."

Mu Liya shook her head and guessed, "I know the real situation is lower than the figure, so... 1000 yuan a year? Or... 800?"

Tugou shook his head calmly: "Too high. In fact, depending on the region, some rural areas with good conditions can indeed reach an annual income of 700 to 800 yuan per household, but in most areas, the annual income of each household is actually only around 400 yuan... Even in some poorer areas, the annual income of each household is less than 200 yuan!"

Tugou emphasized: "Remember, it's per household, not per person... Based on the size of a household with four adults, the per capita income of adult labor in most rural areas is actually only a little over 100... and the per capita income of adult labor in poor areas is even only 50!"

hiss~!

Mu Liya couldn't help but gasp. She knew that there was a huge income gap between urban and rural residents nowadays, and the income gap between central enterprises and rural areas was even more huge. But she really didn't expect that after experiencing a sudden rise in prices, there are still places in rural areas where the average annual income per capita is only a few dozen yuan.

She wanted to say that it was impossible.

But when I thought that Qilu is one of the important staple grain producing areas, and grain is extremely sensitive, the three words I was about to say were choked in my mouth.

Is this... another form of "low grain prices hurting farmers"?

Thinking of the prices on those old rice certificates that the drilling company had obtained from various grain bureaus in order to secretly speculate on the project, Miss Mu could not help but smile bitterly.

But she couldn't say that this was wrong. After all, stabilizing the price of daily necessities was the top priority for all countries, and the price of staple food was undoubtedly the foundation of all this.

Tugou saw what Miss Mu was thinking, but did not go into the issue any further. He just sighed and said, "So, Sister Mu, you see the key to this, right?"

"At a time when most rural households have an annual income of only 20 yuan and the average per capita income is just over yuan, a monthly income of yuan is already a good job that almost doubles their income!"

"More importantly, Sister Mu, you haven't lived in the countryside, so you don't know some situations... With the actual situation of two mu of arable land per capita in Qilu, if it is just to ensure the production of staple food, then it is not necessary for a family to work around it all day... In other words, if a family of four are all healthy adults, they can squeeze out about two abundant laborers!"

"So, now you know what this 20 yuan/month income means to the people in most rural areas of the Central Plains?"

"This means that the real income of each household may increase from 400 yuan per year to 600 yuan or even 800 yuan per year!"

"It means that the surplus disposable income of each household has gone from 0 or negative to 200 yuan or 400 yuan... Sister Mu has learned relevant knowledge and should understand that on the basis that 20 yuan can guarantee the minimum living expenses per month, the difference between a monthly salary of 40 yuan and a monthly salary of 80 yuan is far from being as simple as doubling, but should be calculated as three times."

"Of course, more importantly, this means that the number of idlers in the countryside will decrease rapidly, and the social atmosphere will be effectively improved... As the saying goes, there is always trouble out of nothing. Although this may seem like a trivial matter at first glance, Sister Mu should know that it is very important for Yang Shidan's plan!"

Mu Liya nodded. The countryside is not a pure land. Even in Qi and Lu, there are many messy things. Yang Mo had selectively helped those villages before, and promoted the so-called comprehensive scoring system under great pressure. This shows that he attaches great importance to the cultural atmosphere of each village and believes that this thing is crucial to his future plans.

After hesitating for a moment, even though Tugou gave a lot of reasons, Miss Mu was still a little hesitant. After all, if this matter was really implemented, if someone was not careful and exaggerated it by someone with ulterior motives, it might cause a very big negative impact on the reputation of Dongying and even Yang Mo's department... After more than a year of training, Miss Mu knew very well that for Yang Mo, goodwill was his most valuable asset.

Seeing Miss Mu staring at Yang Mo in silence, obviously letting him make the decision, Tugou also shifted his gaze to this man.

Yang Mo looked at the two girls staring at him and smiled slightly: "Girl, if I'm not mistaken, you want to use this project as an experiment... If it goes well, I'm afraid that Xialiu Sales Agency will pop up a lot of self-funded projects from time to time in the future, right?"

It is obvious that Yan Laoxi is behind this matter, and Tugou was also instigated by that guy, so he is determined to raise funds for this purple candy project on his own... Only that guy would be so superstitious about the things from decades ago and would want to mobilize the masses in everything.

Tugou didn't hide anything: "Old Yan did some work on my mind, but more importantly, I also wanted to try it myself."

Yang Mo frowned slightly: "Why? You should know that business matters are not that simple. Often times, you can't get things done just because you have passion."

If it is a project that Yang Mo has selected with his foresight, and if there are drilling companies and Dahua Company coordinating resources to protect against the wind and rain, then when funds are tight, this self-financing model can naturally be tried;
But it is obvious that with the precedent, the self-raised projects that pop up in the future may not be what Yang Mo likes, or even projects that are spontaneously organized by villages and directly bypass Yang Mo's projects. The outcomes of these projects may not be so beautiful.

Tugou shook his head. "Since the end of last year, I have often followed the people from Xialiu Sales Agency to visit various villages. The conditions in many villages make me feel sad...very sad!"

"Besides, no matter how rich the drilling company is, it is still limited. There are so many fellow villagers here. Even if you work yourself to death, you can't help everyone... It's better to teach people how to fish than to give them fish. Only when everyone helps each other can everyone's life really get better."

Yang Mo nodded. Although his words were full of Xia Liu's style, they were in line with the girl's personality. "But have you ever thought about the consequences of doing this? If this model succeeds, everyone will be happy, but if it fails... the consequences will be tantamount to making hundreds or thousands of people completely bankrupt."

Seeing that Tugou was about to speak, Yang Mo stopped her: "I am not emphasizing that the education level in rural areas is low and talent is scarce... This reason is actually quite nonsense. It may make sense in high-tech industries, but if it is only involved in primary agricultural products, food processing, and industrial primary processing, it is not convincing at all... Knowledge does not mean ability, and learning a lot does not mean understanding a lot. I see this more clearly than most people... Besides, the domestic economy as a whole is in an upward period, and the dividends of the times are here. Educational qualifications are not the key to the success or failure of a project."

Based on their familiarity, Yang Mo took the lead in saying what Tugou wanted to say, and then looked at her seriously: "But the problem is... human hearts are the most complicated things in the world. The more technical barriers there are in an industry, the more likely people are to change their minds and even crush each other out of selfish desires. In the end, the project is completely messed up due to constant internal friction."

"The reason why I have been selectively helping those villages and executive teams is based on this consideration... I can't guarantee that everyone will not degenerate, but no matter what, people who grow up in an environment with a good atmosphere are less likely to have dirty thoughts, or their shelf life may be slightly shorter... Anyway, my psychological bottom line is that I have done my best to help them get through the most difficult period in the early stage, and as for what happens in the future, it's up to fate... You should understand the difference between the two."

Tugou naturally knew that the reason why Yang Mo helped those villages so much was, firstly, out of a mentality of repaying favors, and secondly, because he adhered to the principle of cause and effect replacement... The more you deserve help, the more I will help you; when you are not worthy of help, I will not help you.

Although the standard of this logic is not measured by interests but by character and atmosphere, as far as Tugou is concerned, Yang Mo's approach clearly reveals his distrust of human nature and emotional entanglement.

Thinking of this, Tugou looked at him seriously: "Yangshidan, I don't know why you are so pessimistic about human nature. I also know that there are indeed many shitty things that make people want to beat people up. "

"But as far as I am concerned, as far as Old Yan is concerned, as far as Old Sun is concerned, we are willing to believe that people are made of flesh and blood, and we are also willing to believe that most of our fellow countrymen in Qilu are kind-hearted and righteous men;"

"Didn't you always say that in life one does not seek wealth, but only a pure mind and clear thoughts?"

"We're not starving to death anyway. So... Lao Yan, Lao Sun, and I are willing to give it a try and see if we can, through our efforts and this self-financing model, try to give our fellow villagers more motivation!"

After a slight pause, Lu Yingying smiled bitterly: "I know you are very capable. Since you have concerns about this model, there must be hidden dangers in it... But there is no way, I am a person with no future. What I have seen in those villages in the past few months really makes me feel uneasy. If I am not allowed to try... I think I will never be able to sleep well for the rest of my life."

Yang Mo knew that although this girl was an emotional person at heart, she was not completely without sense of propriety in many cases.

Since she could say that she would never be able to sleep well for the rest of her life, it was obvious that what she had seen and heard in certain villages in the past few months must have been extremely unbearable to watch.

It seemed as if the time and space vision overlapped again. Yang Mo looked at Tugou classmate steadily, as if two faces appeared before his eyes.

"Okay...as you wish!"

This was the second time Yang Mo said this after his rebirth, and his expression was as gentle as ever...

(End of this chapter)