Under the conditions of market economy, the purpose of the existence of enterprises is to make profits, and enterprises that cannot make profits for a long time have no need to survive.

However, this situation is less applicable in the context of the Internet economy.

Many investors are more concerned about the long-term development of the company.

In the previous life, Jingxi Mall also began to make a profit many years after its establishment.

In the case of good economic development and sufficient market funds, Internet companies continue to lose money, but if the long-term prospects are good, they can still maintain their development through continuous financing.

However, the market cannot always be that good.

At the end of November 2007, although it cannot be said that the market was already very short of funds, prescient investors began to slow down the pace of development and try to hold cash in their hands.

After all, the impact of the subprime mortgage crisis, after several months of fermentation, has not only not disappeared, but has become more and more serious.

On November 9, 2007, after nearly two months, Bank of America, Citibank and Morgan Stanley agreed to spend at least $75 billion to help the market out of the subprime mortgage crisis.

On November 26, 2007, Bank of America began to lead Citigroup and **** to raise $80 billion for the Superfund.

It seems that major institutions are vigorously trying to maintain market stability, but this just shows that the market is very unstable now.

Financial markets around the world are sometimes in a similar direction.

Just like when consumers in the Celestial Empire buy houses and stocks, they buy up and don't buy down.

When the financial market is very prosperous, all kinds of funds flock to it, and when the market is sluggish, everyone flees in a swarm.

At this time, the crisis will become more and more serious.

"Mr. Jiang, Jingxi Mall is now the fastest growing shopping site in the country, and our current valuation is at least quadruple compared to when you first became a shareholder, and the future is limitless," Liu Qiangxi said.

It is estimated that Jiang Hui is worried that he will lose confidence in Jingxi Mall after hearing the latest profitability, and Liu Qiangxi did not directly answer Jiang Hui's question.

"Do you feel that the subprime mortgage crisis originated in the United States?" Jiang Hui did not directly continue to ask, but changed the topic and said.

"Originally, I didn't feel anything, but judging from the recent situation in the venture capital circle, I heard that foreign venture capitals such as IDG and Sequoia Capital have shrunk the scale of investment, and new investment has fallen into a trough for many years, and I have become very cautious about additional investment, so I slowly feel the impact of this crisis," Liu Qiangxi said with a little loss.

Jingxi Mall is also building warehousing centers all over the country, advertising on major websites, and in order to attract new users, it has launched a variety of preferential activities, and this year, not only the funds invested by Guanghui Group have basically been used up, but also the purchase of the storage center land to the bank for mortgages.

It can be said that Jingxi Mall is now the weakest time since its establishment.

Originally, the weakest time of Jingxi Mall should have happened in 2008.

In that year, every entrepreneur felt the rejection of investors in the financing dilemma under the capital winter.

The same thing is more serious in Jingxi Mall, the most difficult time, Liu Qiangxi has heard 40 investment institutions say NO.

At that time, Liu Qiangxi tried his best to meet with investment institutions, sometimes two or three a day, sometimes five or six a day, and visited more than 40 companies, but still no one took a fancy to Jingxi.

Every investor asked him: How does Jingxi make money? What are the advantages of your model compared with a certain treasure network? What are the advantages of cost compared with Gome and Suning? There are also criticisms such as low gross profit margin and poor operational efficiency.

At the same time, BWI's valuation plummeted, and Liu Qiangxi talked with investors about financing, and the price fell from $200 million to $150 million, $120 million, $100 million, $80 million, $65 million, and $45 million...... In the end, it was reduced to $30 million.

Even, Jingxi Mall has to rely on bridge loans to survive, and it can be said that it has reached the stage of life and death.

Although the current situation in Jingxi is not so bad, there are some new situations.

The huge investment in the launch of all categories of products and the huge investment in the construction of warehousing centers, although the daily turnover has exceeded 100 million in recent times, the annual turnover in 2007 can exceed 10 billion.

However, having almost exhausted the last round of investment, and owing the bank a bunch of money, it needs more money than in the previous life in 2008.

With a financing of 120 million, there is no way to solve the dilemma of Jingxi Mall.

"This is just the beginning, the impact of the subprime mortgage crisis will be bigger and bigger, you have to be mentally prepared," Jiang Hui said.

"Mr. Jiang, there is something I want to discuss with you", Liu Qiangxi said after a while.

"What's the matter, you say".

"I want Jingxi Mall to have its own logistics."

"Own logistics? That's a lot of money."

"Do you think it takes a lot of money to build your own logistics?" Jiang Hui asked.

In the previous life, when Jingxi Mall was preparing to build its own logistics, the investor asked Liu Qiangxi to make a budget, and the result was one billion US dollars, which is definitely not a small number.

"The start-up capital does not need to be particularly large, and a $100 million is almost enough", Liu Qiangxi obviously did not want to talk to Jiang Hui about self-built logistics on a whim, but made full preparations.

"How much money do you think will be needed in the long run?"

"It depends on the extent of construction, but to roll out in major cities across the country, at least 500 million US dollars, or even 1 billion," Liu said.

Daily Fresh has only initially built its own logistics in a few first-tier cities, and has already spent almost 100 million US dollars.

At this pace, Liu Qiangxi's budget is actually relatively conservative.

After all, in addition to a few first-tier cities such as the imperial capital, there are also a large number of second- and third-tier cities in the country.

If you really want to roll it out in an all-round way, let alone 100 million, 500 million, even 1 billion US dollars is not enough.

"How much money does Jingxi have in his account now?", Jiang Hui asked.

"Less than fifty million".

"If I'm not mistaken, Jingxi Mall doesn't want to make money every month, at least it loses tens of millions, right?" Jiang Hui said.

The most attractive thing about online shopping is that the price is lower than that of a physical store, and then it is convenient.

The price should be lower than that of physical stores, in addition to the online store can save shop rent and reduce the labor cost of unit goods, that is, to see if you can get a lower ex-factory price.

Judging from the situation in 2007, although the online shopping market is developing rapidly, there is still a big gap compared with the physical market, which also leads to the fact that it is unrealistic for the website to get a very low exit price.

So what to do?

Subsidies.

What is full of 100 minus 20, full of 250 and so on, all kinds of discounts are overwhelming.

In this case, how can Jingxi Mall be so easy to make a profit?

(End of chapter)