Chapter 64: Deal Sealed
Anyone who's studied abroad in Europe or America knows: the food there is practically a diet plan for Chinese people.
For someone like George Smith — who came from a culture where "steamed vegetables with no flavor" was the norm — the richness of Chinese street food was a delight. With a variety of skewers and snacks, the three of them were full after just half an hour.
Back at the hotel, Elena brewed coffee for the three of them.
"Thank you," George Smith said politely to Elena. Then he turned to Yang Wendong. "Eric, I think it's time we talk business."
Elena continued serving as translator. After listening, Yang nodded and replied, "OK. Let's follow Hong Kong's standard export model.
I'll be responsible for production and shipping. I'll deliver the goods to British customs by sea freight, and you'll arrange for pickup on your side.
I'll handle everything before the goods reach the UK — after that, it's on you. We'll price everything in Hong Kong dollars."
"Sounds fair," George nodded. But instead of jumping into pricing, he asked, "Your product involves chemical components. Will there be any customs issues on the UK side?"
Yang explained, "There shouldn't be a problem. The main adhesive used in the glue boards is a Japanese product that's already being sold in the UK.
The flypaper has an additional ingredient — peanut oil. While that isn't commonly sold in the UK, it's a food-grade substance, and since it's used for a non-edible product, it shouldn't raise any flags.
I've already arranged for someone to apply for the necessary export permits to the UK. Hong Kong is part of the Commonwealth, and as long as there are no major issues, the approval should come through quickly."
When Elena first mentioned a potential British distributor, Yang had immediately instructed Zhang Weida to apply for export approval.
Back in this era, customs regulations weren't particularly strict — especially within the Commonwealth. As long as a product wasn't considered dangerous, approvals were generally straightforward.
And once a UK import permit was obtained, it was usually valid across other Commonwealth countries as well. That was one of the few real perks of being within the British Empire: internal trade was smooth, even if external markets were harder to crack.
Just a few years later, Japanese electronics companies would begin setting up factories in Hong Kong for the same reason — to use the territory as a springboard into the Commonwealth market. It was this very shift that would lay the foundation for Hong Kong's electronics industry.
George nodded after hearing the explanation. "Good. And what about the rest of Europe?"
Yang shook his head. "Let's not rush into that. We should first focus on building a solid presence in the UK."
The main issue, of course, was money. Applying for customs approvals across different countries in Europe wasn't just time-consuming — it was expensive. It didn't make sense to do so without at least some level of confirmed demand or a clear opportunity.
Unlike the later EU, Europe at this time was still a collection of independent states, each with its own language and regulations. The UK was far easier to handle — once the permit was approved, the rest of the Commonwealth would be open.
George agreed. "You're right. Once we've gained traction in the UK, it'll be much easier to sell the idea to others in Europe. Alright, let's discuss pricing."
Yang said, "Mr. Smith, including the sea freight costs, my price is 0.50 HKD per mouse glue board and 0.55 HKD per flypaper sheet. We'll calculate everything in Hong Kong dollars.
My suggestion is to review pricing every three months. But unless there's a significant change in exchange rates, shipping, or raw material costs, the price should stay relatively stable."
He had done his homework before this meeting, including checking the latest shipping rates.
At this time, containerized shipping wasn't yet the norm, so sea freight was relatively expensive — though it depended greatly on the product.
Fragile, bulky, oddly shaped, moisture-sensitive items were the most expensive to ship. These challenges were among the biggest barriers to global free trade.
But items like glue boards — flat, lightweight, and not particularly fragile — had a big advantage. They were cheap to ship.
Based on the quotes he got, Yang calculated that the cost of sending one glue board to the UK by fast cargo ship was just under 10 cents per unit — not exactly cheap by future standards, but reasonable for now.
Smith didn't rush to haggle. Instead, he said, "Personally, I think the mouse glue board has a fair chance in the UK market. But the flypaper… that one might be a harder sell, especially in commercial settings. People would find it off-putting."
Yang nodded. "I understand. Different cultures have different preferences. Let's try it and see. There's still the household market to consider."
Though flypaper worked effectively to eliminate flies, a board full of dead flies displayed in plain view was not something most people wanted to see — especially not in a restaurant.
That's just human nature. One or two flies buzzing around, no one minds. But a swarm all stuck in one place? Disgusting.
And this was the difference in nature between the two pests — mice were afraid of humans and stayed hidden. Flies? They flew around fearlessly in the open.
Smith nodded. "Alright. Still, I think the price is a bit high."
The two entered a lengthy negotiation, which went on for over an hour. In the end, Yang agreed to lower his original asking price by 5 cents.
This rate was slightly higher than the domestic selling price in Hong Kong, but for opening up a new market, giving distributors a good margin was necessary.
Later, once he had distributors in multiple countries, he could revisit the pricing strategy.
After all, there was no exclusive contract and no fixed pricing agreement — everything was still flexible.
If exports to multiple countries went well, the factory would have the upper hand. If not, the distributors would call the shots. That was the eternal rule of business.
"Eric, I'll be staying in Hong Kong for three more days," George said with a smile. "During that time, please prepare around fifty mouse glue boards for me. I'll take them back by plane."
Yang nodded. "No problem. I'll personally deliver them to you."
After they left the hotel, Yang pulled out a small envelope from his bag and handed it to Elena. "Elena, please take this."
"What's this?" Elena had a guess. She opened the envelope — inside were a few banknotes. She immediately frowned and said, "Eric, we've known each other long enough now. You should know I don't accept money for things like this."
"I know," Yang said, shaking his head. "But this time is different. In the past, you could say you were helping as part of your job — helping the poor or doing public work.
But today, you introduced me to a private client and helped with translation. This was a completely personal favor — nothing to do with your position. That means you deserve to be paid. It's proper compensation."
"Hmm... you have a point. But this is too much," Elena said, half-convinced.
Yang shook his head again. "It's not too much. You love helping others — but that takes money too, doesn't it?"
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