"Guangzheng, it's been hard on you. I didn't expect you to enter the European market." Feng Yu and Fu Guangzheng were celebrating with a glass of champagne in their hands.
Regardless of Europe or the US, all the sales of Hua Xia beverages were entrusted to a company called Beverage Alliance (BML). Of course, the owner of this company was Feng Yu.
This company was not a company that focused on making profits. It was a company that was helping Hua Xia beverages to enter the US and Europe. That's why Feng Yu did not let Fu Guangzheng invest in this company.
But Feng Yu had acquired 5 bottling factories in the US and Canada, and Fu Guangzheng had acquired a few bottling factories in Europe. He felt these beverages would be able to gain a foothold in Europe.
If these dairy beverages could gain a foothold in the US and Europe, then they will continue to acquire dairy beverage factories.
"Hard work is secondary. But can those Hua Xia beverage factories survive? They will suffer losses this year and might even suffer losses next year." Fu Guangzheng reminded Feng Yu.
They had to pay a high price to expand the market. Not only the advertising fees, but they also had to pay to enter the supermarkets, high transportation, storage, promotions, etc.
There was always a price to pay for new products to enter the market. But this price might not be reciprocated. In Feng Yu's previous life, Coca-Cola had failed to market their tea beverages in Hua Xia. Coca-Cola had spent a lot on advertising and had strong distribution channels, but they were still no match for Kang Shifu, Tongyi, and the other tea beverage companies.
"My BML company is not making any money from them, and they are already very generous. If they are not willing to continue, then I will not force them. At least Jianlibao, Qi Li, and tea beverages are doing well. If these brands can survive, all our efforts will be worth it. "
A loose alliance could easily cause problems. Those companies had gotten the upper hand, but they still felt they had suffered losses.
"The mistake is that you don't make money. The more you don't make money, the more they'll take advantage of you. They don't care what you think. After all, you are a shareholder of Wahaha and Jianlibao. If you say that you are promoting Hua Xia, they will think that you are using their brands to enhance the competitiveness of Wahaha and Jianlibao. If not, why can't they get electrical appliances and cars during this promotion? "Fu Guangzheng shook his head.
"Those appliances and cars were all privately sponsored by me. I didn't spend a single cent from anyone. It's up to me who I want to sponsor. I have nothing to do with them, so why should I do so much for them? "
Feng Yu finally understood what it meant to be grateful for a raise of rice, but an enmity for a bucket of rice. Although it was true that they had the intention of using those brands to enhance their competitiveness, it was obvious that those brands would get more benefits.
However, those companies did not pay much attention to the development of the European and American markets. They thought that they could make money by selling their products. The more they sold, the more they earned.
But now, the more they sold, the more they lost. Although their brand awareness is increasing, it's useless if they don't make money!
Feng Yu was helpless against such short-sighted people. Luckily, Zong Qingxian and Li Jingwei are supporting Feng Yu. They know the importance of the market and brand.
It's fine if they lose money at the start, as they are prepared to lose money for one, two, or even three years. As long as they can gain a foothold in the European and US markets, they will get their money back sooner or later.
Also, their profits in China are enough to ensure their cash flow will not be affected. Kang Shifu and Tongyi from Taiwan were the ones making the biggest fuss. They felt their tea beverages were not marketed well, and Feng Yu had purposely treated them differently because they were from Taiwan.
Treated differently? If it wasn't for the differential treatment, Tongyi and Kang Shifu will not be listed in the Beverage Alliance.
Both companies were successful in their instant noodles business, and Tongyi was the world's biggest instant noodle company. But in the beverage industry, both companies were not doing well, and Kang Shifu was a newcomer.
These two companies only had tea beverages, and their products were not as good as Wahaha, Le Bashi, and Jianlibao. These two companies did not spend a lot of money, and it was good enough for them to promote their products in supermarkets. Why do they want to use newspapers to promote their products? Why didn't they do the One More Bottle promotion?
These two companies did not want to do this promotion, and Wahaha, Le Bashi, and the rest should not do it too. If not, they will be fighting among themselves.
At the same time, these two companies increased their production and started to seize the domestic market share. They used the strategy of surrounding the cities from the rural areas to sell their products to the towns and counties. They did not care about the cities. As for the price, it was 50 cents cheaper than Wahaha and Le Bashi's tea beverages. You are selling it for 2 RMB, and we will sell it for 1.5 RMB!
Of course, Feng Yu does not care about these sales tactics. It's a good thing for everyone to have a higher standard. But the problem was when the US asked for their products, these two companies reduced their deliveries!
Their reason was also very simple. Didn't they need to supply the European supermarkets? Their domestic sales had suddenly increased, and their production capacity could not keep up. However, they guaranteed that they would be able to recover by next month.
The US side was not making money, and Hua Xia's products might be selling at a lower price, but there were still profits. Their products were selling at a lower price than Wahaha and Le Bashi in the US.
One side was making money, and the other side was not making money. Anyone who was not stupid would know which to choose. Furthermore, these two companies had gained the upper hand in the European and US markets, and their sales had increased by a lot.
They were waiting for the US market to have such sales without the need for advertising fees. That way, they would be able to make profits.
If their sales can increase again, it would be better.
Their solution now was to drag on. They will continue to maintain their brand exposure and refuse to pay advertising fees. They will also reduce the supply of their products to reduce their losses and increase their brand awareness.
Being next to a popular product, their brand awareness would definitely increase.
As for the terms in the agreement, if they could not meet the supply requirements, they will withdraw from the European and US markets. These two companies did not abide by it and refused to withdraw from the US market.
Feng Yu was furious with these two companies for their shameless behavior. Seems like he needs to give these two companies a warning. There are many types of tea beverages in China, and these two companies' products are not a problem. Since these two companies are not willing to abide by the agreement, then don't blame me for cracking down on your tea beverages in China!
Feng Yu called Zong Qingxian and Li Jingwei to discuss with them and asked them to give these two companies an ultimatum. If not, these two companies must comply with the agreement and deliver their products as soon as possible. If not, these two companies must withdraw from the European and US markets and pay the penalty fees.
Before Feng Yu and the rest could punish these two companies, the two companies started to take action.
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