Chapter 49

Part two: The Allure of Business - Chapter 49: Success within easy reach

Granted, agents needed a certain amount of capital to stock their markets, as well as distribution channels to control the retail market, but their most important quality was still their ability to promote products.

The presentation of this advertisement alone, and the results it achieved, made Ye Xiaotong take notice of Zhang Ke's planning ability. If she truly suspected Haiyu Company of attempting fraud, why would she have walked into the office?

Haiyu Company's Haizhou office had neither funds nor distribution channels, but its excellent market planning had neatly solved this problem, naturally inspiring confidence that its promotional capabilities could not be far behind.

Ye Xiaotong spent the entire afternoon at the office, watching Zhang Ke lead Liu Minghui and the others in using their silver tongues to paint the vast prospects of digital communications for the telecommunications equipment merchants who came after hearing the news. They urged the merchants to put up funds so that Haiyu Company could secure Ericsson's agency rights in the Haizhou area. In just half a day, prospective funding from those willing to cooperate with the office reached six hundred thousand yuan. Quite a few others remained undecided, not because they doubted the prospects of the digital mobile phone market, but because they had reservations about the form of cooperation the office proposed.

Agency networks were established level by level from the top down. Haiyu Company had gone against convention: before even obtaining the agency rights, it had boldly begun developing the retail market, binding together the retailers it had lured in with the news before going after the agency rights.

This was an extraordinary measure Zhang Ke had been forced to take because the office had neither funds nor distribution channels. All he could rely on were Haiyu Company's resources as an empty shell and his silver-tongued descriptions of the digital mobile phone market's prospects.

Even Xu Si was dumbfounded by these results. She had never imagined that the advertisement would achieve such an excellent effect.

Before the dinner specially arranged by the office, Ye Xiaotong reported to her superior, Shengxin Trading's marketing director, on what she had seen and heard during her day in Haizhou City, including the lively discussion of digital mobile phones among its residents.

The problem-solving and market planning capabilities demonstrated by Haiyu Company's Haizhou office were precisely what domestic agents generally lacked at present. Over the phone, Ye Xiaotong made her position clear: she believed the office would make an excellent partner. As it happened, her cousin Ye Jianbin, the president of Shengxin Trading, was also there.

What interested Ye Jianbin most was Zhang Ke's strong confidence in digital communications technology. At the beginning of the year, it had likewise been his own insight into the telecommunications market, and his conviction that digital communications systems would soon replace analog systems, that had persuaded his family members to take a near all-or-nothing gamble on securing Ericsson's exclusive agency rights for East China.

Digital communications networks had begun trial operations in major and medium-sized cities along the southeastern coast in the middle of the year. Only two or three months had passed, and their technological advantages over analog systems had yet to become fully apparent. Not everyone within the company had sufficient confidence in him. Moreover, Ericsson's GH388 digital mobile phone, released in 1994, had an English-language interface (the GH398 Ericsson released in 1995 was the Chinese-language version of the GH388), which greatly restricted promotion. Hearing his cousin Ye Xiaotong describe what she had seen and heard in Haizhou gave him quite the sense of having found a kindred spirit, and he immediately decided to make Haiyu Company a specially appointed agent.

Shengxin Company was Ericsson's exclusive agent for East China and had already appointed a provincial agent in Donghai Province. By rights, that provincial agent should select the regional agents below it. This was a relatively strict hierarchical agency system. In practice, exclusive agents for major regions usually kept direct control of markets in first-tier cities within their territories, developing specially appointed agents alongside provincial agents to form a hybrid hierarchical network that allowed them a better grip on the market.

Becoming a specially appointed agent removed the provincial-agent tier, leaving both the major regional agent and the local agent with much larger shares of the profits. Ye Jianbin had also made this decision because he was very dissatisfied with the extremely slow progress of market promotion by Donghai Province's provincial agent.

When Zhang Ke first met Ye Xiaotong, he thought she was a formidable character. When she told him of Ye Jianbin's decision before the dinner began, he found her an exceedingly lovely woman instead.

Ye Xiaotong did not forget to add, "You're the first business partner we've decided to work with at our very first meeting. We're even willing to relax the funding requirements for initial stock. If possible, we can begin discussing a detailed cooperation plan tomorrow morning. As you know, I can't stay in Haizhou City for very long..."

Xu Si found it somewhat unbelievable. It had been less than half a month since Xie Wanqing handed the office over to her and Zhang Ke, yet they had already achieved results like these. Before this, she had still been worrying about this month's utility bills, property management fees, and staff wages.

Once they secured Ericsson's agency rights in Haizhou, the cooperation intentions agreed upon today could quickly be realized. Several hundred thousand yuan in prospective funds would flow through their hands to Shengxin Company, and they could skim off tens of thousands just by handling it.

The key was that this could set a good example. With the agency rights successfully secured as well, those who had been optimistic about the digital mobile phone market today but had reservations about Haiyu Company's approach to cooperation would probably put those doubts aside too.

Jiang Wei, Yang Yun, and the others were somewhat stunned. Only now did they learn that this was the office's first formal contact with Shengxin Company. Until then, they had always thought Haiyu Company had already reached a preliminary understanding with Shengxin Company over the agency rights.

Faced with this outcome, they exchanged looks. When they looked at Zhang Ke, they no longer had any doubts about his age. The psychological fortitude to dare deceive his own employees, and make them believe him completely, was truly not something an ordinary person possessed.

Jiang Wei had entered government service at twenty-two. Over the past seven or eight years, she had not accumulated much to take particular pride in, but she was confident that her judgment was no worse than anyone else's. She glanced at Zhang Ke. His lean, handsome face looked very young, but his sharp eyes were confident and composed, and his bearing in every gesture made him seem quite mature. She could not help thinking, If I'd known earlier that the office hadn't even contacted Shengxin Company yet, I probably wouldn't have had much confidence in a lot of the work we did.

Less than a week had passed since her interview, and Zhang Ke had not appeared very often during that week, yet Jiang Wei had to admit that he was someone with considerable charisma and influence.

Zhang Ke did not dwell on what Yang Yun, Jiang Wei, and the others were thinking. He had assumed that even if they became Ericsson's agent in Haizhou, they would come under the provincial agent, so becoming a specially appointed Ericsson agent surprised him. Haizhou's economy ranked fourth in the province at the time, and its market capacity was limited. Zhang Ke estimated that the entire Haizhou area would add around five thousand mobile phone users in 1994, a very small number compared with its total population of 6.5 million, and the overwhelming majority of that market belonged to analog mobile phones. In the Provincial Capital, however, mobile phone users made up a much higher proportion of the population. Within a hierarchical agency system, Haizhou City should have fallen outside the first-tier cities.

Zhang Ke guessed that Shengxin Company might be dissatisfied with the Donghai provincial agent, but Ye Xiaotong was tight-lipped and revealed no such dissatisfaction. He ventured a question: "Xintai City to the north doesn't have an agent yet, and the provincial agent has no branch there either. If we supply dealers in Xintai City, that wouldn't count as crossing territorial boundaries, would it?"

Market promotion in second- and third-tier cities was the provincial agent's responsibility. Strictly following the hierarchical agency system, even if the major regional agent appointed an agent directly in Haizhou, it would still have to count toward the provincial agent's market share. The boundaries between local territories were also clearly defined.

But the Donghai provincial agent's promotional work was very unsatisfactory, and even now large stretches of the market remained untapped. Ye Xiaotong neither agreed nor disagreed with Zhang Ke's question.

Zhang Ke smiled. It was simply a tacit understanding.