Beicang District, located in the northeastern corner of Yongcheng City, is roughly the size of a certain slope country in Southeast Asia.
The district is renowned for Beicang Port, and leveraging its high-quality port resources, Beicang District's manufacturing industry has developed rapidly.
The industrial chain is very complete.
For a single product, all processes from sample to design, production, and shipment can be completed within the regional scope, and large and small factories are numerous within the district.
Textile and apparel, plastic presses, molds, stationery, and port logistics, among others, are all advantageous industries in Beicang District.
Over the past few months, Tan Jincheng has also met some big and small bosses and visited factories in different industries.
Some are in his current primary industry, apparel and textiles, and some are concentrated in mechanical processing mainly for auto parts and mold manufacturing, introduced by Cheng Yongjun.
Through observation, factory workers, especially assembly line workers, generally have wages below the average wage level.
To earn more money, there is no other way besides endless overtime.
Larger factories provide food and accommodation, using such benefits to attract workers.
The food and accommodation conditions are very average, or even poor.
As for smaller factories, which cannot provide food and accommodation, they use slightly higher wages to attract workers.
Taking Zhang Haiping's garment factory as an example, they calculate wages on a piece-rate basis, belonging to the "more work, more pay" type.
Therefore, workers generally work extremely long hours, starting at 7:30 AM, with the earliest knocking off time usually at 9 PM.
During busy periods, they even work past 10 PM, with little rest at noon.
The low-rise bungalows and illegally built rental houses near the factory are their shelters.
The extremely long working hours did not bring them high incomes; their monthly income was also below 5,000 yuan.
All of this was gathered by Zhang Xupeng.
The piece-rate system, which seemingly offers higher income the longer one works, is not true in practice.
When you exceed a certain amount, the boss will find ways to lower the piece rate.
Young people in later generations often mention "involution," but little do they know that involution has existed in every era.
When exploitation is too severe, worker stability naturally decreases.
In Zhang Haiping's garment factory, employees with more than two years of service are considered old employees; most workers typically change jobs after a year.
Unstable employees lead to unstable quality, and expanding the scale naturally becomes more difficult.
This is also why Tan Jincheng suggested Zhang Haiping improve employee benefits.
He didn't ask for a huge increase, but at least a little more humane treatment, and to ensure that when order volumes are sufficient, the unit price of clothing is not deliberately suppressed.
If he wants to secure large export orders, Zhang Haiping's current operating model is definitely not viable.
For now, it's acceptable as the foreign trade industry has only recently boomed, and everyone lacks standardization, which foreigners also tacitly accept.
In the future, when competition intensifies, various factory inspections, qualifications, and worker benefits will be crucial test points; failing any of these will result in direct disqualification.
"Tan Laoban, how could I not know all that you've said? But increasing production capacity and improving worker benefits are not so easy; these all require money."
"Investment is definitely necessary; there's no industry that doesn't require investment. Moreover, future competition will certainly become more intense, and quality must be stable. If the defect rate is too high, it will be a loss for you as well."
"I understand everything Tan Laoban said. I'll think about it. However, it's definitely not possible this year; any expansion would have to wait until after the New Year."
"Understood. For things like machines, you can actually consider some used machinery, which would significantly reduce investment. As for labor, I still suggest you improve benefits.
If you at least provide one meal at noon, employees' morale will be better. Also, for example, giving some travel allowance for going home, and a few hundred yuan as a bonus for returning next year."
Currently, there's no shortage of workers anywhere, and it's indeed easy to recruit.
But this won't be the case in the future.
In a labor-scarce environment, a factory's reputation is often very important.
In his previous life, Tan Jincheng once heard a factory's HR manager say that when their factory recruited workers, they dared not state their factory name, only the address, to trick people into coming.
Because their reputation was ruined and they were famous throughout the district, any worker who knew a little would directly refuse once the factory name was mentioned, making recruitment incredibly difficult.
Tan Jincheng also didn't want his OEM suppliers to have such a reputation in the future.
The two chatted for a while longer.
After all, Tan Jincheng had run his own business in his later life; although he hadn't managed such small factories, he had seen and heard a lot about them, and knew some more advanced management experiences from later generations.
After some persuasion, Zhang Haiping, who already had plans to expand production capacity, was greatly moved.
Seeing this, Tan Jincheng decided to reassure Zhang Haiping:
"Zhang Laoban, I can't guarantee anything else next year, but I can guarantee 400,000 orders every month, totaling 5 million orders for the whole year."
Over the past three months, Tan Jincheng's main energy has been devoted to customer maintenance, contacting business cards collected at the Canton Fair one by one.
Currently, besides James, who placed the first order and became a stable partner, there are also three others with long-term cooperation intentions.
The four long-term potential partners are from the United States and Northern Europe, both high-profit and low-risk regions.
There is also a Japanese client being negotiated with; if successful, they could also become a long-term stable customer source.
Tan Jincheng doesn't lack national sentiment, but he also has no psychological burden about earning money from the Japanese.
With four or five stable client sources, another push at the Canton Fair in March will continue to expand stable clients, striving to reach an annual export volume of 2 million US dollars this year, aiming for 5 million US dollars.
This goal is not aggressive for Jinpeng Trade's current momentum; on the contrary, it's somewhat conservative.
James once said that if Tan's production capacity could keep up, he could place orders worth 100,000 US dollars every month.
In an era of rapid industry growth, it's common for a company that has established itself to achieve annual turnover growth of over 100%.
Listed companies on the A-share market often report revenue increases of 100% to 300% in their annual reports, mostly occurring during periods of industry dividends.
If others can do it, Jinpeng Trade can too.
Just as James painted a rosy picture for Tan Jincheng, Tan Jincheng also painted a rosy picture for Zhang Haiping.
A guarantee of nearly 5 million yuan in orders from a single client for the entire year is an irresistible temptation for anyone, even if it's just a verbal promise.
"No problem. I'll start preparations right after the New Year and guarantee that I won't delay Tan Laoban's orders."
"Alright, then let's call it a day. I'll head back now."
"Today is Sunday, and there's nothing much to do. Tan Laoban, why don't you stay for dinner before leaving? I'll make arrangements for tonight and invite a few friends over."
It's barely three o'clock, what dinner?
But this old guy's attitude is getting better day by day; he hasn't called me Xiao Tan recently.
"Next time, I'll host. I still have some things to do today."
"Alright then, let's meet again next time. You can rest assured that I will seriously consider what Tan Laoban said."
"I trust Zhang Laoban. Also, perhaps we could have an even better mode of cooperation, for example, jointly setting up a new factory. Zhang Laoban can consider it."
Completely transferring the risk seems a bit unrealistic; these small bosses are very shrewd.
Signing an agreement with suppliers by taking a stake and independently setting up a new factory would make the supply system more secure and stable.
The words Tan Jincheng left when he departed made Zhang Haiping fall into deep thought, and also opened up some new ideas.
(End of Chapter)
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