Extraordinary Genius - Chapter 203 – Buying into Le Ha Ha Part 2
Tai Hua Trading actually did not have too many funds. Although the company earned a lot last year, it had also spent a lot on the shares. Feng Yu does not intend to cash out the share this year.
The shares cannot be sold, and Feng Yu still owed the bank. After the Lunar New Year, it will be the start of a new financial year. Feng Yu still needs to pay a large sum of interests. This will shrink the company’s account further. The increased of the advertising fees added to Feng Yu expenses.
But Feng Yu was not worried. When he returns to Bing City, he will split the advertising fees based on the products. Whichever company or factories’ products were advertised, they would have to share the advertising cost proportionally!
This was especially so for the Machinery Company.
Also, the Soviet Union’s technologies wanted by the Motor Factory will soon be brought over to Bing City. These technologies would bring a few million profits for Feng Yu and Kirilenko and Li Shiyou would settle all the taxes incurred.
There will also be the revenue from motorcycles sales. Based on the contract with Li Mingde, Tai Hua Trading would settle the payment at the end of the month. Feng Yu could still raise 10 million RMB easily. For instance, using the funds from Tai hu Food Processing Factory.
Zhong Qingxian had still not given Feng Yu a definite answer, but he promised Feng Yu that he would give him a reply within 3 days after he returns to Hangzhou. Feng Yu could tell that Zhong Qingxian was already moved by his offer.
Feng Yu did not say much and return back to his room to rest.
Early afternoon next day, Feng Yu returned to CCTV. To everybody’s surprised, Feng Yu bought 3 more expensive advertising slots.
The way Feng Yu spend his money shocked everybody again. Tai Hua Trading had outshined all other companies, bought the most advertising slots and paid the most.
The rest of the advertisers found out that Tai Hua Trading was the company that sold Wind and Rain humidifiers and Songjiang motorcycles. These products were all cash cows! They were more astonished to find out that this young man was the General Manager of Tai Hua Trading and not the boss’s son.
This resulted in Feng Yu leaving CCTV with his bag full of name cards. Some were private companies, and some were state-owned enterprises. There were even foreign companies. Feng Yu had brought 100 name cards with him, and it was not enough!
Feng Yu still had one more thing to do in Beijing. He wanted to visit Baldy Chen to look at the commercial he filmed for Wind and Rain bladeless fans.
At first, Baldy Chen does not want to take on this sort of jobs. But his investor for his movie backed out last minute and he was short of funds.
Feng Yu had paid him 50,000 RMB for him to film this commercial, which also includes the script. He then paid Baldy Chen another 300,000 RMB to endorse the product for 3 years. Baldy Chen gladly accepted it. An electric fan’s advertisement fees could not be compared to motorcycles.
A few days ago, Baldy Chen had gone to Bing City to film the commercial. It was the same as the motorcycle commercial. He rushed back to Beijing immediately after he completed the shoot. He had used his spare time to film this commercial and finish the editing.
Feng Yu watch the commercial on the TV. Even though he knew that this would be a funny commercial and had attended the filming at the scene, he still laughed when he watched the edited version.
Baldy Chen had put his bald head through the bladeless fan top, and with his exaggerated expressions and funny lines, the effect of the commercial was perfect.
The second commercial’s creativity was also thought out. Baldy Chen would wear a wig, and the wig was blown away by the bladeless fan. But this commercial would be filmed the following year.
With this commercial, it will increase the bladeless fans sales. It was the right choice to get Baldy Chen. The Chinese are always curious about new things, and there will be many wealthy people buying the fans to satisfy their curiosity.
The advertising slogan, “High-tech products, aristocratic style of enjoyment”, would fulfill the vanity of these wealthy people. Even if only 10,000 units were sold in China this year, Feng Yu would also get more than 10 million in profits!
Back at Bing City, Feng Yu looked for Li Mingde. The CCTV advertising contract would expire in May. Since they will recontract and continue to air the commercials, Li Mingde got to pay for it.
After Lunar New Year, the sales of the motorcycles increased again. 7,000 units were sold in January, and 8,100 units were sold in February. In March, 10,050 units were sold!
Feng Yu said that this was the effect of advertising. If they continue to advertise at CCTV, the sales will increase further after May 1st. There should be no problems achieving the 130,000 units target this year, and they might even hit 140,000 units!
Feng Yu had recontract the advertising slots, and even though the advertising fees had increased by a lot and he bought an additional 3 more slots, the duration of the contract was only about 7 to 8 months. The total advertising fees were not more than 7 million RMB. This amount was reimbursed by Li Mingde!
Hmmm… reselling CCTV advertising slots felt so good!
That evening, Feng Yu received a call from Zhong Qingxian when he was playing video games with Wen Dongjun.
Zhong Qingxian had returned to Hangzhou and discussed with his partners. Their factory needs to expand, the productivity needs to be increased, and they still needed to get new facilities. All these required monies.
They had not repaid their existing bank loans, and they were unable to get new loans as they had no more assets as collateral. Now, someone came to them to use 10 million RMB in exchange for 40% shares. This was an excellent opportunity for the debt-ridden Le Ha Ha.
Zhong Qingxian told his partners about the pros and cons of selling these shares to Feng Yu. He said to them that they would still be in control of the company and Feng Yu would not interfere with their operational decisions. He would only send a financial representative over to look over the accounts.
When the other partners heard this, they were overjoyed! They had suffered for a long time. At first, the company was doing well but later, their production could not keep up, and they suffered.
The company was making money, but they could not get a single cent as all the money were used to expand their facilities. Although the company has a bright future, at the same time, the risk is significant. If their sales had some hiccups and did not reach their forecast, they would have trouble paying the bank!
Now there will be one more person to share this risk and also inject funds into the company. They would be able to increase the factory’s output and increase the market share. This was a win-win situation!
The 2 partners always wanted Zhong Qingxian to look for an investor. The company was struggling to stay afloat, and even the supplier wanted to stop supplying raw materials to them!
Since all the partners agreed to Feng Yu buying a stake of Le Ha Ha Company, Zhong Qingxian called Feng Yu in front of his partners.
Feng Yu asked Zhong Qingxian to come over to Bing City for the contract signing. The money was ready, but Feng Yu could not leave Bing City.
Zhong Qingxian could not help but asked Feng Yu if there were some problems with his company. Feng Yu just replied that there was no problem with Tai Hua Trading. It was just that he still needs to attend school. He could not get any more leave!
Zhong Qingxian: “……”
He suddenly realized that Feng Yu was still a high school student!
A high school student running such a big company? What a monster!