Into Unscientific

Chapter 370 – Pricing And Price Wars! (Down)

Chapter 370 Pricing and price wars! (Down)

The great man has a good saying.

Hit with one punch to avoid a hundred punches.

In addition to the diplomatic field, this sentence also applies to shopping malls.

What Huadun Biotechnology Institute is about to face right now is a fierce punch from many foreign companies united together.

be honest.

Xu Yun and the others are not unable to withdraw.

But if you give up at this time, the situation facing “One Mantis Extinction” will be even more difficult in the future.

Because the product of cockroach medicine has an upper limit of audience, every time a customer is robbed by other brands, it means that there is one less “passer-by” left for Huadun Biotech.

And if you can win.

Then Huadun Biotech will consume more than half of the sales of as much as 40 million in this cycle-this is not a one-time sales. In terms of the effect of “killing one beetle”, at least 90% of consumers will choose to return. purchase!

This means that “One Mantis” will gain a firm foothold, and the offensive and defensive momentum will change accordingly.

At that time, Xu Yun and the others only need to press F2A to leave the keyboard with both hands.

In the meeting room.

Zheng Zu communicated with several people around him, then turned to look at Gu Qunqing, and asked:

“Manager Gu, I don’t know if the operation department has estimated or discussed the situation of the price war?”

Gu Qunqing nodded, affirming:

“Of course, according to our pre-discussion, if we want to fight a price war, we must first make two preparations.”

“Which two aspects of preparation?”

“The first is the reserve link of the source of goods.”

Gu Qunqing raised a finger, and at the same time changed the slide to another page:

“According to our previous analysis and simulation, before the price war starts, the finished product reserves of ‘One Mantis’ should be at least 800,000 pieces, which means a total price of 16 million.”

“Director Qian, you are fully responsible for this matter, is it okay?”

When it comes to his own job, Qian Guanglin is no longer so cautious, only to see him sticking out his chest confidently:

“No problem, Manager Gu, there is still about a month before the Chinese New Year. Calculated based on the fact that the price war started 15 days before the festival, we still have more than ten days for production.”

“When the equipment is fully used, it is not a big problem to produce 800,000 products-our raw materials are mainly from Henan, and now the order can be shipped to Luzhou in about two days, and our existing material reserves are enough to support until then gone.”

But soon, Qian Guanglin’s expression hesitated again:

“It’s just Manager Gu. In this way, our financial problem.”

Qian Guanglin did not finish the second half of his sentence, but everyone present could understand what he meant:

Currently, the factory can produce 45,000 units of products by working overtime all day. Based on the price war from the first 15 days, the factory can produce 700,000 units of finished products.

but

Currently, the production cost of “One Mantis” is still very high. Calculated at 6.5/piece, the production investment alone needs to be close to 5 million Huaxia coins.

Huadun Biological Sciences can take out the money, but what about other publicity and distribution links?

Is it impossible not to advertise?

To know.

Internet sales are not just a matter of the production side, the list of online shopping platforms and big data promotion are also big.

For example, the charge for the carousel section of a certain Baodatu is 250,000 yuan per day, that is, 250,000 yuan.

Another example is the diamond booth of a treasure.

Diamond booths are charged per thousand impressions, and the unit is CPM, that is, 1CPM=1000 impressions.

There are many kinds of diamond booths of a certain treasure, but the principle is that the higher the click-through rate, the more expensive the price.

For example, the transaction price of a position with a click-through rate of 2% is generally 5 yuan for 1,000 times, and the budget cost of 1,000 yuan can be displayed for 200,000 times.

Multiplied by 2% of the clicks, the total number of clicks that can eventually be generated is 4000.

So, each click will cost you $0.25.

More critically.

This position requires bidding.

That is, the platform gives an initial price—for example, 0.1/click, and then others start to increase the price, and the one with the highest price wins.

It’s okay to say something about the normal time period.

Generally, except for Lengtouqing, veterans will have a psychological price ceiling, because it will be difficult to pay back if the price exceeds the ceiling.

But now that there is a price war going on, those foreign companies will inevitably raise the cost of these booths through bidding, even if they lose money.

If Huadun Biotechnology does not follow, the booth will fall into their hands.

However, if the price is raised accordingly, the cost of publicity and distribution will be greatly increased, which will put a lot of pressure on the company’s funds.

In the meeting room.

Hearing what Qian Guanglin said, Gu Qunqing sighed, nodded, and readily admitted the current financial dilemma:

“That’s right, according to the estimates of the operation department, once this price war starts, our promotion costs may reach 1.5-2 million a day—after all, we need to take into account the malicious bidding of multiple platforms and competitors.”

“The average input cost for each location is estimated to be 50% or more higher than normal.”

“That is to say. Within seven days, I am afraid that about 13 million will be burned.”

“hiss”

Hearing the number that came out of Gu Qunqing’s mouth, Rao was prepared in his heart, and the hearts of everyone present were still heavy.

Seven days to burn 13 million, plus product discounts.

That is to say, in this price war, the company basically does not need to consider the issue of profitability, and will inevitably lose money.

But this is also normal.

After all, this is a life-and-death struggle involving the future pattern of cockroach medicine, which is far different from ordinary commercial competition in nature.

The magnitude of profit is far from the forefront of the target.

Throughout the history of Internet business, there are many more exciting price wars than this one.

For example, the Meituan Ele.me subsidy war in 2014 should be one of the most representative Internet price wars in the history of Chinese business.

From May 8, 2014 to April 30, 2015, Ele.me burned a total of 455 million US dollars, a total of 2.8 billion yuan.

On average, more than 200 million will be burned in a month, 3 million per day.

In this case, the competition is who has the best ability to continue blood.

“Boil the others to death” and survive, and you will be able to become the king.

Think here.

Gu Qunqing could not help but take a deep breath, and said to everyone:

“Everyone, as I said just now, since we are going to fight a price war right now, we must first make preparations in two aspects.”

“The first preparation is the source of goods that Director Qian is responsible for, and the second preparation is.”

“I hope everyone will work together to solve the financial problem.”

After Gu Qunqing finished speaking, the expressions of everyone in the meeting room did not change much.

Those who can sit here are all smart people. As early as when Gu Qunqing assigned the task to Qian Guanglin, they had already seen some clues:

Gu Qunqing is about to ask for money.

No wonder it is Gu Qunqing and not Xu Yun who presided over the meeting today. From the face of it, Gu Qunqing is obviously much thicker than Xu Yun

Then Zheng Zu pondered for a moment, then turned to look at a middle-aged man on the left of Gu Qunqing, and asked him:

“Accountant Ma, how much money is still on the company’s books?”

The Accountant Ma that Zheng Zu was talking about was a bald man with a bitter face and a deep hatred. After hearing this, he clicked the mouse a few times and quickly replied:

“Chairman Zheng, since Hanhua Heavy Industry has just settled the final payment for equipment, the company still has about 4 million funds in its account.”

“There are two other repayments totaling more than 3 million yuan that have not yet been settled during the deposit cycle, and they will probably arrive next Thursday.”

“Four million plus three million”

Zheng Zu’s eyes flickered a few times, and he calculated:

“That’s more than 7 million yuan in cash reserves. After deducting 5 million yuan in product costs, there are still more than 2 million yuan.”

“And if we count promotion expenses and other expenses, as well as the ‘small treasury’ to prevent special circumstances, the cash we have prepared this time must be at least around 15 million.”

The 13 million operating expenses that Gu Qunqing mentioned earlier are just the promotion expenses of multiple online business platforms. In the price war, the proportion of social platforms cannot be ignored.

Toutiao, Station B, Public Account, Douyin.

The money in these places is thrown into a terrible bottomless pit.

Then Zheng Zu hesitated for a moment, then raised his hand again:

“Manager Gu, what do you think of this? The Xinchuang Fund will borrow another 800, let’s say 10 million. I will lend 10 million to the company, but the interest will be 3.5 million per day, and the money must be paid back within a month.”

Xu Yun in the audience couldn’t help showing a hint of joy when he heard the words.

When the company introduced the FOERDA-T632 production line, Zheng Zu once borrowed a flexible loan of 20 million yuan, and the interest was ten thousand percent.

Just after the FOERDA-T632 production line entered the Wassenaar agreement, Xu Yun turned to buy several production lines from Hanhua Group, which greatly reduced the cost, so the money was not actually spent.

Not long ago, with the arrival of a new batch of product payments, Xu Yun returned the 20 million together with interest to Xinchuang Fund.

Now that the company is facing a crisis, Zheng Zu really thought of the funds again.

This is also one of Xu Yun’s and Gu Qunqing’s main goals today.

Again.

Zheng Zu is a very typical businessman thinking, but this does not mean that he is mercenary or does not know how to adapt, he is still a good person.

To know.

Although the money is called a flexible loan, the approval process is actually quite troublesome. Zheng Zu actually has to bear certain risks if he wants the money to arrive quickly.

As for the interest of 3.5 ten thousandths.

Although it is a bit higher than 2/10,000, in the current situation, no one will care about these details.

New Venture Fund is not Zheng Zu’s one-word hall or private small treasury, and some rules must be followed.

Then Zheng Zu thought about it, and said:

“In addition, I will ask the people on the e-commerce platform to see if they can temporarily open a back door for us, such as returning the payment immediately after the logistics information is released-this should also squeeze out about two to three million.”

As soon as Zheng Zu said this, the atmosphere in the conference room became more lively immediately visible to the naked eye.

Well known.

For most merchants, the settlement method of a certain treasure is generally to pay after receiving the goods, which is about 7 to 15 days before and after.

At the same time, a certain treasure also issued a loan with instant settlement, that is, the logistics information is entered in the background and settled immediately, and the interest is about 1/10,000.

However, for large manufacturers, the settlement of certain treasure and other platforms will not be so casual.

Those large enterprises generally have a settlement and payment collection cycle, such as once a month or even three months.

That is to say, the manufacturer will always have a sum of money on the online shopping platform, instead of settling once every seven to fifteen days.

Predictably yes.

Once the price war starts, the amount of the pledge will definitely not be too small—at least it will not be lower than the three million that has not been paid yet.

If Zheng Zu can release this part of the funds, the help to the price war will obviously be very considerable.

Seeing Zheng Zu’s effort, Tian Liangwei at the side hesitated for a moment, and then said:

“Manager Gu, on behalf of the School of Life Sciences of the University of Science and Technology, I will borrow 2 million, but the process may be more complicated, and it will take about a week to arrive.”

2 million.

Although this amount is not as high as Zheng Zu’s 10 million, for Tian Liangwei, this is already the limit he can afford.

And unlike Zheng Zu.

Tian Liangwei’s doing so may also cause some criticism, and it is easy to be distorted to bring rhythm.

For example, some people deliberately did not talk about the lending and restitution, and smeared this matter as a personal “capital injection” behavior, and a draft of black material came out.

This is not Xu Yun’s imagining. A certain academician of Nantah University was blackmailed in this way.

Think here.

Xu Yun couldn’t help but sighed.

no way.

Who makes less money in his pocket?

Huadun Biotech is currently in a stage of rapid development, basically repeating the routine of selling-paying back-buying materials-increasing production-paying back.

Due to the continuous increase in investment, the profit is actually not much.

Currently counting dividends, Xu Yun, the chairman, only has about 480,000 yuan in his bank card—of which there are more than 200,000 yuan in his original savings.

He who sees it is sad, and he who hears it weeps.

So this case.

It is obviously impossible for Xu Yun to wave a check like a rich father.

Of course.

If there are no accidents, by this time next year, Xu Yun should have more money in his card.

The line of sight returns to reality.

After Tian Liangwei borrowed a sum of money, the agent of the School of Physics who attended the meeting on behalf of Academician Pan also borrowed 2 million in cash.

Including Zheng Zu, everyone had a tacit understanding and did not propose the idea of using it as equity.

After all, Xu Yun doesn’t have much money at the moment. If he raises funds now, Xu Yun’s shares will inevitably be diluted.

This kind of approach is a bit too unethical—although the word “eat phase” is a bit pretentious in the shopping malls, Huadun Biotechnology is a company of the University of Science and Technology after all, so we still need to pay attention to this aspect.

If you switch to other venture capital institutions, at this time 100% will ask to start the B round of financing to dilute the founder’s shares, otherwise no penny will be invested.

This is the cruelty of shopping malls, and it is also the reason why many newly hatched companies want to get an XX-type identity.

all in all.

With the arrival of 1000+200+200, and Zheng Zu’s promise to contact the platform to ensure real-time payment.

The funding problem of this price war has been somewhat resolved.

after an hour.

The meeting adjourned.

Xu Yun accompanied Tian Liangwei and Zhou Shan down the stairs, and bid farewell to the two bosses in the parking lot.

Looking at the passing vehicle, Xu Yun frowned slightly.

Do not know why.

He always feels that the price war this time seems to be far more simple than it seems.

Note:

This chapter says it should resume on the 25th

(end of this chapter)