novelnext Chapter 1128 - 1130
Chapter 1128 - 1130
Zhao Gang looked sullen as he went over the documents in his hand.
Shaking his head repeatedly, "Look at this contract you prepared; it’s so simple it can’t get any simpler."
"This is a partnership agreement, after all."
"Even our current procurement contracts are better than this."
Gong Ruini pursed her lips, "We’re just starting out, and no matter how pretty the contract looks, it depends on execution."
Otherwise, why are triangular debts on the rise now? "If the goods are sent out and the money can’t be recovered, what’s the point?"
Bringing this up was a sore point, and Zhao Gang and the others had plenty to say.
"They won’t agree to bring money for collection, or they won’t do business with us."
"But doing business with them without getting paid is quite frustrating as well."
"Isn’t that the truth? I was looking at the accounts receivable the other day and was shocked to find it accounted for half of the income." Cai Ming was also troubled.
"If we can’t receive payment, what’s the point in doing business?" Gong Ruini understood they were worried about losing long-time clients.
Once a client gets snatched away, winning them back takes considerable effort.
"Let those eager to grab business do so. Even if they grow their business, if they can’t recover payments, how will they restock?" Eventually, with fewer competitors, business will be easier.
The idea is nice, but unfortunately, "They can owe goods too."
"Triangular debts are exceedingly common now."
These days, from what Zhao Gang has investigated, it’s genuinely terrifying.
"Is it really that bad?" Lately, Cai Ming had been busy with various things and hadn’t inquired about this; Zhao Gang’s findings truly startled him.
Zhao Gang nodded, "I think Ni Zi’s suggestion is good. I’d rather open my own store and sell the items myself."
"Although the cash flow would be slower, at least it would eventually come back."
"Selling to them looks good, but if payments don’t come back, it’s as if we have nothing." Zhao Gang wasn’t foolish; by opening branches in various locations, they could at least buy property locally.
Perhaps the money earned from selling goods wouldn’t be as much, but with real estate prices rising continuously, this might bring them a pleasant surprise.
"Actually, we can ask the other party to pay a deposit. For instance, the deposit could cover our cost of goods."
"Then we can tell the person in charge that if they pay us within a certain period, we’d offer them some benefits." Offering discounts to clients might not catch the person in charge’s attention.
Either way, whether they pay or not is company money and doesn’t affect them personally, better to directly offer it to the person in charge.
To secure this benefit, wouldn’t they vigilantly push for financial payments?
Gong Ruini’s idea was stolen; she had considered suggesting this approach earlier. Though over time, as everyone begins doing this, money’s influence might diminish, it could at least help recover some of their accounts receivable.
"We can also propose that they delay one shipment payment, but they must clear previous dues when picking up the next." Although Zhao Xuran felt clients might be reluctant to accept this suggestion.
But offering clients some gap for adjustments might touch them to some degree.
Zhao Gang found the idea good but wanted to hear Gong Tao and Cai Ming’s opinions.
"I think it’s feasible, as long as the current payments are collected." Cai Ming felt even more pressure, as to expand sales, the factory’s products had to cooperate with many distributors.
"In the future, I plan to buy stores near bus or train stations to sell our products. I don’t believe property prices in those areas won’t rise, nor that business there won’t flourish."
"Yes, yes, I also plan to open my own furniture store." Gong Tao initially aimed to sell their quality furniture to private customers, thus avoiding inventory backlog issues.
Unexpectedly, as products earned a reputation and returning customers brought in new business, many furniture distributors took notice.
"Going forward, for them to get goods, there’s no such thing as old or new clients; discounts will be based on the volume of goods taken."
"If they pay upfront, we’ll offer them additional discounts." Gong Tao jotted these down in his notebook.
"Otherwise, I won’t have money to continue doing business." Gong Tao wasn’t keen on investing so much in facilities and capital to open a factory, only to keep pouring money in.
If the investment was to expand the plant, he had no complaints, but to constantly invest money due to issues wasn’t feasible unless he owned a bank.
"Yes, this proposal is good." Zhao Gang’s eyes lit up, "Previously, I considered small trades as not worth my while."
"Now I see I was foolish; these involve actual cash."
After all, small and large trades, whether in the range of thousands or tens of thousands, require similar effort, but their profit margins differ significantly.
As a veteran in large trades, Zhao Gang didn’t value such small transactions, perceiving them as time-consuming, keeping subordinates busy.
Now realizing it’s a major mistake, Zhao Gang recorded this insight.
Though Wan Qiweng and Cai Meina’s factories had recently started, engaging in insufficient credit trades, they both began taking notes of these ideas.
With just a couple of years in operation, the factories were vulnerable to these issues.
While Wan Qiweng worried about rude treatment driving clients to other factories, recalling the product quality assured her of the need for monitoring business volume alongside cash flow.
Cai Ming was no exception, "Looking around, Ni Zi and Xuran’s business seems to be thriving."
"Indeed, with no debt involved."
Despite outwardly expressing envy towards Gong Ruini’s flourishing business, they were undoubtedly reluctant to abandon factory management to solely oversee a tutoring center.
However, as they sat down for discussion, their views on Gong Ruini shifted significantly.
"Seems like I should set a rule against credit business," proposed Cai Ming, promptly dismissing the idea himself.
"If I proposed that, the factory would soon shut down."
Unable to go against the trend while others allow credit dealings unless having unmatched products or cost advantage, no one would approach.
Unless they lowered profits, yielding a pricing advantage.
Cai Ming recognized that meticulous calculations wouldn’t result in losses, but having grown accustomed to substantial profits, seeing reduced earnings on the same goods wouldn’t sit well.
Feelings of dissatisfaction would naturally arise, "We must have distinct offerings."
"Products others can’t match."
"Even if imitated, they wouldn’t replicate effectively."
The idea is compelling, but is it truly feasible?
Without research and development direction, it’s all speculative.
Gong Ruini wasn’t particularly optimistic about Cai Ming, but refrained from disheartening comments, hoping that hope might inspire him towards improved initiatives.