Journey 1995:Non-Stop

Chapter 361 The First Sword After Reaching the Shore

Research and development in the chemical industry is extremely complex. It's not just new products that require research and development; even current polyurethane adhesives require continuous research and development.

Yan Hui's customers are now all over the country, and his product is glue. The climate varies in different regions of China, and the temperature and humidity vary in different seasons.

The effectiveness and bonding properties of glue vary depending on the humidity and temperature environment. Therefore, the R&D team needs to constantly adjust the formula and make some fine-tuning to meet the needs of various customers.

In some arid regions, it's necessary to appropriately reduce the evaporation coefficient of the adhesive to ensure it has sufficient time to set. Conversely, in some humid regions, it's crucial to find ways to ensure the adhesive sets as quickly as possible.

Nowadays, whenever the R&D department encounters a new customer, they send people to collect local climate data and then provide product data for different seasons for the customer's reference.

This plan has only been implemented gradually in the last few months. Although the experiment cost several hundred thousand yuan, the customer feedback has been quite good so far. Fortunately, the R&D department has been expanded on a large scale, otherwise it would definitely not have been possible.

The optimal shelf life of polyurethane adhesive is about 6 months, and the longest shelf life is more than a year. Because the adhesive does not take up much space, Yan Hui also built a temperature-controlled storage system to store some polyurethane products appropriately, so that business operations can be more flexible.

Of course, my brother-in-law also bought a few more large air conditioners.

After leaving Mr. Yuan's place, Yan Hui went to properly handle the Heng Hui Chemical matter, pointing out some paths for future development. Everyone else just needed to focus on their own work.

After a year of development, the company's operations are now on track.

On the supply side, Yan Hui has established a deep partnership with the suppliers, allowing them to communicate directly with the lab to manage inventory. This has resulted in the suppliers being highly dependent on Yan Hui. Currently, they receive several million yuan worth of goods from Dongda and Wanhua every month, making them significant clients. Therefore, when they encounter routine problems, Dongda and Wanhua will definitely step in to help them resolve them.

On the sales side, Song Zhiyuan is a graduate of a prestigious university, so his management skills are quite good. He has earned a lot of commissions this year, and buying a house in Jinan is no longer a problem for him.

With Heng Hui Chemical on track, Yan Hui's workload increased significantly. He only needed five or six hours a day to handle most of the work at Heng Hui. This gave him the energy and time to prepare to devote himself to the steel industry.

Yan Hui has been dealing with steel for many years, and don't forget that he has been in the steel formwork rental business for several years.

Back then, he bought steel formwork for only 2300 yuan per ton. Later, when the price of steel formwork rose, he even made a profit. Yan Hui has been involved in the steel industry for eight years, from his first contact with it in 1999 to preparing to enter the market at the end of 2007.

In this situation, Yan Hui still chose the transaction method with the lowest risk: not to lock in a price with the bidding party.

As long as the price isn't locked in, the steel price will be calculated based on the price on the day of delivery, meaning Yan Hui will face no risk and will simply follow the market price.

The payment cycle for steel is one month. Yan Hui currently has about 1000 million yuan in available funds, which will increase by three to four million yuan every month thereafter. In addition, he can use the entire company as collateral for a bank loan.

The company's land is currently secured by a mortgage, but it has no other loans. The company's factory buildings, equipment, and other assets, as a whole, can be mortgaged to a bank for a substantial sum.

The company is currently in a very healthy position, and the bank is well aware of its cash flow, so Yan Hui can easily obtain a loan of over 2000 million.

Compared to the 3% monthly return on steel, the interest on bank loans can be ignored for the time being.

Therefore, Yan Hui now has ample funds to become an agent. Don't worry about where my money comes from; as long as I have money, that's enough.

Late November is the "off-season" for steel mills, and few people usually choose to become primary agents at this time. Therefore, when Yan Hui went to communicate, he was offered many preferential terms.

The first change is that the evaluation period has been extended from 3 months to 4 months. If a total of 15000 tons of steel can be sold within 4 months, the evaluation will be considered passed.

Secondly, during the evaluation period, as long as the monthly sales volume reaches 5000 tons, the "commission" will be settled according to the price of 3600 yuan for a first-level agent. If the sales volume does not reach 5000 tons but exceeds 3000 tons, the commission will be settled according to 3620 yuan.

If Yan Hui's performance is exceptionally good and monthly sales exceed 1 tons, then the price per ton can be reduced by another 20 yuan. It doesn't matter if this isn't achieved now; it will be the same in the future.

Thirdly, during the evaluation period, no second person is allowed to enter for the evaluation. Yan Hui is now authorized to conduct business as a Level 1 agent. Conversely, if Yan Hui fails to meet this sales target, he will no longer be able to enjoy this preferential treatment, and may even be permanently barred from applying for Level 1 agency status.

Fourth, after the investigation, the requirement of monthly sales of 5000 tons and annual sales of 10 tons cannot be lowered.

Fifth, if Yan Hui completes the sales of 1.5 tons ahead of schedule, he will secure a first-level agency position in advance.

"Mr. Yan, it's been a pleasure doing business with you. I'm pretty good at judging people, and I think we'll see each other again soon," Mr. Yuan said with a smile. "You're willing to sign this contract, so you must already have orders, right?"

“No, not really, but I’m quite familiar with the bidding for three construction sites. Mr. Yuan, I’m not lying, I really have no experience in steel trading before. I only got to know you through Mr. Li’s connections,” Yan Hui said politely. “So, I need to be a first-level agent here to be able to bid.”

"Is President Yan planning to use open bidding?" President Yuan was taken aback.

"With so many problems in the industry, someone needs to clean it up," Yan Hui said righteously.

He didn't consider himself a good person, but no matter what, his public image had to be presentable.

Nowadays, when bidding is held at every construction site, a large number of people participate. During the bidding, they usually prefer to bid on a total price, which makes it easy for unqualified bidders to slip through the cracks.

In reality, the normal bidding process should be based on the unit price. Steel mills have guidance prices, so the bidding should be based on the steel mill's unit price. In this case, some middlemen who are not primary agents can be eliminated.

The primary distributors bear enormous financial pressure and are core partners of the steel mills; they should be the ones making the money.

Conversely, middlemen don't tie up a single penny of capital. They act as intermediaries between primary agents and construction sites, making a fortune by taking 20 yuan per ton of water. Therefore, some primary agents are willing to cooperate with them.

When Yan Hui first started doing "business" in Fengtian, he worked as an "intermediary," facilitating connections between clients and timber mills in exchange for "information fees." Intermediaries didn't require any upfront costs or capital investment, and Yan Hui was initially happy to earn even a few dozen yuan.

Now, he has plenty of money and has made it back to shore.

The first sword strike after reaching the shore is to kill those below.

(End of this chapter)