Chapter 41: The Purchase Channel
Translator: Nyoi-Bo Studio Editor: Nyoi-Bo Studio
At Jin Ling West Road, No. 188, there was a store called “Forever Jewels.” This was the name of the jewelry shop that Chen Jin opened. He did not name it himself, as he had no ability to give it a good name. It was He Li who came up with the name after a round of discussions.
On Chiu Wan-Ting’s side, her renovation process was rapidly progressing. After all, that shop used to be a jewelry store before, and it had facilities that were ready for use. She knew that Chen Jin was eager for the shop’s opening, and she wanted the renovations to be completed within half a month. Therefore she had decided to do some minor repairs and add-ons. The basic set-up of the shop remained unchanged. She would replace a portion of the counter, redo the floor tiles, and re-sand the walls. The hanging lamp fixture need not be replaced, only cleaned. Finally, she would install the plaque that had already been ordered and was being manufactured in the factory. The renovations would certainly be completed within half a month, and would only cost a maximum of about $200,000. It was both time- and money-saving.
Chen Jin was very satisfied and thought it was an awesome plan.
Unknown to him, Chiu Wan-Ting’s real intention was to help him save money. The young boss had put her in such an important position and trusted her so much. One had to know that the annual rent of the shop was nearly $5,000,000 and the profit margin was already very slim. If she did not try her best to help the boss save some money, his startup would fail not long after the jewelry shop opened. She would feel terrible if he had to pay such a steep learning cost. Therefore, she would try her best to save costs anywhere she could.
The jewelry shop was scheduled to be opened either at the end of this month or the start of next month. However, the sourcing of the goods remained a question. There was no sign of a single gemstone or jewelry. Without proper stock, how would they open the shop at the end of this month?
Therefore, she had to discuss with the boss and constantly remind him to confirm the purchase channel in advance. Otherwise, there would be no time. She called the boss and asked him to come over. The two of them discussed this issue in the office located on the third story.
“Boss, do you have any purchase channels for the jewelry? Or an agreement with the jewelry manufacturers to collaborate, or signed the contract for them to be your suppliers?
“Purchase? Collaborate?” Chen Jin was stumped by all of these questions. He shook his head. “Nope, I didn’t really organize any of this stuff yet.” He was so busy recently. How would he have the time for that?
Wan Ting said, “It’s urgent that you go and discuss it. Boss, if the stocks are insufficient, we definitely can’t launch our opening this month. And it may not even be possible to do it by next month.”
Chen Jin shook and his and said honestly, “I’m not too familiar with this.” He knew nothing of the jewelry business. He was a total idiot regarding things like purchasing, collaboration with jewelry manufacturers, pricing, and the industry outlook. He could only say, “Auntie Chiu, don’t be like that. I’ll transfer the money to you and you go talk to the jewelry manufacturer about the purchase channel. I’ll hand over this entire matter to you, how about that?” He planned to task all matters to the professionals and only delegate.
“You want me to go for negotiations on the purchase channels?” Chiu Wan-Ting was shocked. The boss actually tasked her with such an important matter? It was supplies that could involve millions of dollars and he had no worries about her character? She was slightly touched, and found it slightly funny. The young boss really was like a blank sheet of paper. He lacked working and social experience, and he was not mature or seasoned. Overall, he seemed a little innocent and pure.
However, it was certainly possible for her to do the negotiations for the purchase channels. After all, she had been in this business for over 20 years and knew every business link and channel like the back of her hand. No one knew the contacts and know-how to access the industry, its dirty laundry, and its unwritten rules like she did. It would be much better for her to attend the negotiations than the young boss. There would be countless landmines and traps avoided, not to mention the steep “learning price.”
However, there were some things that she had to declare in advance. “Boss, if you truly trust my character, I can help you attend the negotiations for the purchase channels. However, I hope that you have absolute trust in me. Of course, I will give you detailed accounts of every bill of items and every invoice. I can confirm that every expenditure will be backed by hard evidence. I hope that I can get your complete trust. Only then can I rest assured and boldly negotiate on your behalf for the purchase channels.” She meant that she hoped Chen Jin would give her as much power as he could so that she had the freedom to exercise a greater range of motion during the negotiations. Only then could she have the guts to go and negotiate.
Chen Jin understood her unspoken demands and nodded. “No problem. Auntie Chiu, I trust your character. I’ll entrust you with the entire matter of the purchase channel!”
After some consideration, he said, “How about this, is $5,000,000 enough? Is $5,000,000 worth of stocks enough to support the opening of the shop?”
“Um… Our shop is too big. $5,000,000 worth of stocks may not be ample. But there’s about $800,000 left from the renovation budget. We can adjust our supply items. It should be more or less sufficient.” For example, reducing the proportion of gold jewelry and increasing the display counters for the silver jewelry. Simply put, she just had to purchase less gold jewelry.
“Ok, Auntie Chiu. I’ll transfer $5,000,000 to you. If the stocks are still insufficient, then I’ll think of something!” Chen Jin wanted to say that the gold beside the pile of riches in the camping ground weighed a total of 1.55 tons. He could not wait to liquidate them.
“All right, thank you Boss!” Her face was full of smiles, and she felt physically invigorated! She first entered the jewelry business more than 20 years ago and had much experience participating in many sales. Her numerous firsthand contacts with countless clients had given her many precious and rich experiences.
Today was also the first time that she had gotten the ultimate authority to direct the operations of a large-scale jewelry shop. She could do things according to her own ideas and implement her own methods, which she could not do in the past. All in all, she could now make changes to what used to be unchangeable. At this point, her mind was filled with countless ideas and her body was full of energy. With overflowing excitement, she could not help but reveal many industry secrets to the young boss.
“The so-called 9999 gold is only a speculative concept. There is no gold on the market with a 99.99% purity. Even if there was, the price would be astronomical. Jewelry shops would tinker with the 999 gold to make it appear brighter. Essentially, this is a low trick to bamboozle the people. Now, it’s more profitable to be a lesser known unbranded jewelry store than one that is highly branded. As an unbranded store, we have many choices regarding our supplies and greater pricing power. A branded jewelry store is primarily selling their brand names, they can only purchase supplies from selected jewelry manufacturers. For example, the previous Liu Fu jewelry store here purchased gold at a price that was $3 to $5 more expensive per gram as compared to the typical unbranded store. Yet, it’s gold quality was similar. This caused us to have no advantage when it came to pricing. The brand was not as good as Long Feng Xiang or Zhou Chang Sheng. The store was neither here nor there; not dead or alive, why not just become a totally unbranded store? In recent years, as people’s aesthetic tastes changed, it is now much more profitable to be involved in silver jewelry. The cost of silver is low. Industrial silver cost about $3 per gram, but one piece of silver jewelry can sell for $200 to $300 with added value. The material cost is now merely loose change and the profits are higher than gold!”
Chiu Wan-Ting rambled on happily. She imparted almost everything from her knowledge, including all the industry secrets, to Chen Jin. Chen Jin could only repeatedly nod in speechless amazement. He never imagined that the jewelry industry could have such deep waters! At the same time, he felt extremely lucky to have hired a very knowledgeable professional to manage the shop. If he were to rush in and act blindly, it was certain that he would have to foot a steep learning price at every stage. As compared to the potential losses that he would incur were he to act on his own, the monthly salary of $60,000 that he paid Auntie Chiu was nothing.
Everyone knew that the most important thing in the 21st century was talent. He had also heard of the saying, “buying a dead horse for a thousand pieces of gold.” However, when the time came to discuss compensation and benefits, people always thought of how to save money first; how to get the most while spending the least. They would talk about passion and striving hard but not about practical stuff. With this attitude and style, they would not achieve big goals!
Chen Jin had a hunch: even if he did not take the gemstones and jewelry from the campground to sell in the shop, with Auntie Chiu’s experience and ability, the shop would be able to make a profit. It would not make a loss. But, he also felt skeptical. Why did she not open her own jewelry store when she was so capable?
“For 12 years when the economy was booming, I earned more than $300,000. But that year, my husband demanded that I make three meals for him daily, and my workplace was 10 kilometers from my home.” As she explained, her gaze became empty and depressed.
Chen Jin stopped asking.