The Industrial Giant Reborn

Chapter 146 Long-term plan
"In that case, we can discuss the specific content of the cooperation." Phil Knight said.

"If the supply chain cooperation is not a problem, then the problem that you are troubled by, Phil, is the problem of our investment?" Chen Zhiwen said with a smile.

"Yes, Eric, you want 25% of Nike's shares at one time, which is too much. Not only can I not agree, but other shareholders are also reluctant." Phil Knight said after a pause.

"Then the bank should be fine." Chen Zhiwen said with a smile.

"It's really not a problem with the bank." Phil Knight nodded and said, not only did the bank not disagree, but they also wished for Chen Zhiwen to acquire more proportion. The more Chen Zhiwen invested, the more funds Nike would naturally get. , the risk of bank loans will be lower. Anyway, the bank only cares about your company's ability to repay the loan normally, and it doesn't care about the equity ratio.

"Based on Nike's current economic situation, if I own 25% of the shares, it can bring an investment of 500 million US dollars to the company. You are the boss of Nike, and you know that Nike's situation is difficult to solve without such a large amount of funds." Chen Zhiwen said with a smile .

"I want to know, if our board of directors has not reached an investment agreement with you, will you stop building a factory for us in Hong Kong?" Phil Knight did not answer directly, but asked another question.

"Of course, you also know some of my investments in the United States and the situation in Hong Kong. How could I build an OEM factory with very low profits for your company." Chen Zhiwen said formally.

With the help of Nike's ultra-high-speed development in the next 20 years, mastering the high-end shoe-making industry chain is one of the core business strategic plans that Chen Zhiwen set up as early as after he came to Hong Kong. He first started in Hong Kong and moved to the mainland in the 80s. , then the population size and cost performance of the mainland will completely swallow the massive orders of Nike, and then use its own capital and the mainland's own market to develop its own sports brand, which will naturally be extended to the entire clothing brand in the future, and even decades later Counterattack the European and American markets.

Although the goal is set far away and there may be many changes in the future, at least from the perspective of business logic, the idea of ​​this line is no problem. I got it in Hong Kong so that Hong Kong can have high-end textile materials to facilitate the needs of Nike OEM factories. After the opening of the mainland, I will either bring the Berkshire Hathaway factory there or invest in mainland companies. For this factory, since Berkshire Hathaway's factory came to Hong Kong, it is enough to train hundreds of relevant talents. Besides, the mainland will not be weak in textiles in the future.

All this effort was made to allow the local industry to have relevant industrial chains. Otherwise, raw materials would be purchased from overseas. The cost is one aspect, and the time difference is even more unbearable.

The core point of the whole plan is to ensure that Nike's orders can be obtained stably, but how to be stable?Naturally, like Wal-Mart, you have to buy enough stocks, have a certain influence, and the products you can supply yourself are also really high-quality and cheap, so that you can guarantee that there will be no problems in the future.

Although the market value of Wal-Mart is much higher, but because it is listed, it is still possible to buy stocks if you are willing to spend money. Nike is not listed, and it will have to wait until 1980, and it is naturally possible to copy Wal-Mart’s model when it is acquired. But this has delayed at least 5-7 years.

Moreover, Nike's supply chain was mature at that time, and shoemaking was not like the daily goods in supermarkets. It had a certain technical content. Even if I became a shareholder of Nike in the future, I did not have relevant technology and could not produce high-quality and cheap sports shoes. Even if he becomes the largest shareholder of Nike, there is no way for Nike to use his goods, right?

Therefore, this year is the only window. Nike is deeply in debt because of its huge losses in the US factory. While it is short of money, it also urgently needs to divest the production department. At this time, he will naturally take over, but he must also get Nike Otherwise, Nike will come back to life in the future, and the order will be transferred to others, what can I do?
As for technology, now that Nike has no suppliers, it will inevitably support itself. As long as it masters the relevant technology and becomes one of Nike's major shareholders, there will be no big problems with the order.

"But the idea of ​​the board of directors is that if Eric you can build a large shoe-making factory in Hong Kong, then Nike's economic problems will be alleviated on a large scale, so they are willing to accept you as a shareholder, but only willing to provide 15% of the stock Quota." Phil Knight said.

"15% is too little. I need to spend millions of dollars to build a factory for Nike in Hong Kong. What I need to ensure is that Nike's orders will always be given to me. If my factory is built, your orders will not be given to me again. What should I do? Who will be responsible for my losses? Or we can sign a long-term mandatory supply agreement." Chen Zhiwen said with a light smile.

"Eric, as long as your quality is up to standard and the price is right, we will naturally find you for a long-term cooperation." Phil Knight shook his head and said, once this kind of contract is signed, Nike will be controlled by this supplier. In the history of business, except for some top technology monopoly suppliers, other people have never heard of such a thing.

"So I should only take the risk of building a factory? Phil, do you think this is fair to me?" Chen Zhiwen said with a smile.

"This" Phil Knight is also a little embarrassed. He also knows that it is very unfair for others to invest millions of dollars to build a factory without any contract. In terms of business cooperation, he is nothing For super-large customers, there is no guarantee that people will not bird you.

"Well, let's make a compromise, 20% of the shares, I will inject 400 million US dollars in capital, and then sign a ten-year OEM contract. As long as my factory has no quality problems within ten years, then Nike will have to sell at least half of it. What about the factory that gave me the order? It’s only ten years, so it’s not a long time, right?” Chen Zhiwen continued.

However, any larger enterprise will not choose only one supplier when purchasing. This is a normal operation to avoid risks, and it is the same in any industry.

Long-term mandatory supply agreements only exist in a few special industries, and the general textile and footwear industry like this almost does not exist.Ten years is a time for both parties to accept.

"For ten years, we can discuss it. I think the board of directors will seriously consider this issue." Phil Knight said with some confidence.

"Okay, then after you go back to confirm, let me know as soon as possible. It will take a certain amount of time to prepare for the construction of a large-scale factory here in Hong Kong." Chen Zhiwen nodded and said.

Ten years is naturally not safe, but if the so-called long-term contract is too mandatory, then Nike will never sign it. Even if it can be negotiated in the end, it will delay too much time. Other investors can be found at other costs.

Nike's current problem is actually a matter of money. As long as there is enough money, all crises can be easily resolved. Chen Zhiwen only proposed the best solution to the problem, and it is definitely not the only choice. Nike's board of directors includes the immediate The founder, Mayfair Nike, basically doesn’t want outsiders to get too much equity.

And if the contract is not very mandatory, then Nike will be able to bypass it in the future, but it will lose its meaning.

Now we want a ten-year agreement, just to ensure that we can obtain a stable supply in the first ten years, and then obtain relevant technical background. If we want to stabilize it for a long time, the best way is to obtain more equity. Wait a few years, when Nike goes public, the stocks on the market can be traded, and you can easily continue to increase your own equity if you can. After all, a newly listed company will not cost much.

"No problem, I will arrange for the board of directors to confirm this matter as soon as possible." Phil Knight promised.

PS: To explain, a large investment actually requires a long period of negotiation, ranging from months to years, so some investments in the book will not end in several consecutive chapters, but will be done as much as possible Under reasonable circumstances, come back to the ending every few months.

However, in some cases, such as the real estate layout of non-strategic investment, etc., it will be negotiated in one chapter, but the premise will be that a professional team has negotiated for a long time before, and then the protagonist will come forward to negotiate with the other party's boss for the last point.

Relatively speaking, this should be a balance between unhydrological and realistic.

Follow up!
(End of this chapter)