Chapter 060: Choose One of the Two
The cooperation is mainly based on the licensing price, profit margin, and future prospects. The exclusive partnership means that there will be at least $2 billion in profits, and if it is traded overseas, it can successfully avoid corporate income tax. Wells Fargo Energy has been planning to do so for a long time, and they have offshore subsidiaries.
As for the profit margin, it is not that the higher the demand, the better, for example, if the high-end model needs 100 million batteries, the net profit of Fuguo Energy can reach 35%; The low-end model needs 200 million batteries, but the net profit is only 10%. It's like Apple sells less than Samsung, but the profit is outstanding.
In terms of profits, Samsung is at a disadvantage unless they are willing to buy Wells Fargo Energy's batteries at a premium price or work licensing fees. Apple, which is in the advantage of cooperation, has deep pockets, and once the price negotiation is agreed, they can sign an agreement in minutes.
From the perspective of the future, the downhill road of Samsung Electronics also makes the company pay attention to the fact that the current high demand is virtual, in case it doesn't work in the future, fans have shifted, can it still be high? What's more, there aren't many tricks on Samsung's high-end models. On the contrary, it is apples, and the faith of fruit fans is very strong.
Listening to these analyses, Meng Qian also pondered in his heart.
Regardless of his preferences, his goal is to choose the most suitable partner for the two companies, that is, the one that can bring the most profit to the company. Therefore, all verbal analysis and prospect prediction are also auxiliary means, and it depends on how the two sides talk and how the details are discussed.
The company's top management, department heads are busy.
Meng Qian himself has not yet started in person, as the big boss of the company, it is impossible to do everything himself, but it is about "money", and he has to keep a close eye on it. Assistant Liang Tao would report on the progress of the negotiations every day, the price of both sides, etc., and usually Meng Qian would talk to Zong Yan.
A few days later, the Samsung people invited for another interview.
The venue of the meeting was located in a business club, and the high-level executives and interpreters of both sides were present, and a large group of people were dressed in suits and leather shoes, which was very grand and grand. First, they introduced each other politely, and then they sat down, and the waiters in cheongsams served tea to warm up for the opening.
Samsung's Mr. Zhang said: "I am very happy that Mr. Meng can be invited to meet, and we hope that a win-win situation can be achieved in this high-level negotiation." ”
The translator paraphrased the words of the Korean.
After hearing this, Meng Qian smiled: "Yes, win-win." ”
Mr. Zhang looked at the young man and smiled: "To be honest, in terms of battery demand, Samsung is definitely the highest in the world, and the sum of the two and three is not as good as ours." If we join forces, the demand will definitely exceed 350 million in the future. ”
Behind Meng Qian's smile is a quick calculation, according to the company's estimated cost of a single piece, the average price of 25 US dollars to supply 350 million yuan, which means that at least 8.7 billion US dollars of annual turnover will be generated, which is almost 54 billion yuan in exchange, which is a very considerable income.
But Meng Qian was not carried away by the numbers, he said bluntly: "I know Samsung's high demand for batteries, but the problem is still the same, your pricing for the mid-to-high-end does not meet our company's psychological expectations, compared to Apple, their quotations are very satisfactory to us." ”
Mr. Zhang smiled: "It is true that because of the difference in product positioning, our average price will be lower than Apple, but on the contrary, Samsung's high-end model development space is huge, if you add your company's battery technology, take away Apple's high-end market, wouldn't it be easy?" ”
"In terms of high-end mobile phone batteries, we are willing to purchase them at the same price as Apple or even higher, and guarantee that we will need as many models as we produce in the future. Gentlemen, Apple's sales in China are huge, but the small screen and short standby have always been criticized, and users will get tired of it sooner or later. ”
After Meng Qian exchanged a few words with Zong Yan beside him, he said solemnly: "Our positioning for high-end models is 35 US dollars, with an annual demand of at least 100 million yuan, and the average price of other models must reach more than 25 US dollars, which is the bottom line of our company, gentlemen?" ”
According to the discussion between Meng Qian and Zong Yan, the deal is expected to exceed $8.5 billion, and the offer is reasonable on the high-end, but the low-end will make Samsung lose a lot...... As soon as this psychological price came out, the other party immediately talked about it, there were too many controversies, and the translation could not keep up.
Meng Qian took a sip of tea, and then said to his side: "Have you calculated the profit?" ”
Zong Yan said: "Only the profitability of high-end models is relatively high, and the low-end will lower the price, but we can't lower the quality, otherwise we will smash our own brand." ”
"Understood." Meng Qian doesn't like to be low-end, just like that, you have to ensure the quality and take into account the price, and the result can only reduce your profits.
A few minutes later, Mr. Zhang seemed to have an idea: "In terms of the average price, we will truthfully report to the Samsung headquarters for further discussion." ”
"No problem." Meng Qian didn't expect to negotiate all at once.
"Back to the second question, we have an objection to the exclusive price that your company wants." Mr. Zhang said again.
This is the company's net profit, and Meng Qian attaches great importance to it: "Let's put it this way, the bottom line we can accept is 2.5 billion US dollars, and it is not appropriate to go any lower." ”
Mr. Zhang didn't dwell on the issue of price: "I can understand the cost of exclusive cooperation, but I want to confirm that your company gives three years, right?" ”
"Three years after production stabilized, to be exact." Meng Qian said.
"According to our internal sources, Apple is conducting research on new batteries, and after getting your technical inspiration, it may be able to achieve new breakthroughs in three years, and in the long run, if you cooperate with Apple, it will be short-term."
And what's going on? Meng Qian's gaze turned to his think tank, and Zong Yan muttered: "I don't know. ”
Mr. Zhang saw the other party's doubts, and immediately said: "And we, Samsung, are willing to extend the cooperation period with a legal contract, more than five years, and a fixed demand to ensure the profitability of both of us. ”
Meng Qian asked directly: "So you plan to?" ”
Mr. Zhang said: "We are willing to cooperate exclusively for 5 years at a cooperation price of 2.5 billion US dollars, and the annual demand is at least 300 million batteries." ”
Meng Qian thought for a moment and did not reply exactly: "We will consider it." ”
Mr. Zhang smiled: "Looking forward to Mr.'s response." ”
……
The initial outcome of the negotiations was an estimated $8.5 billion a year in business, plus $2.5 billion for five years, under the previous agreement. If agreed, a large sum of cash arrived, and a huge annual income would be generated, making it easy to become one of the world's battery giants.
But Meng Qian was still skeptical.
In terms of operating income, cooperation with Samsung will definitely surpass Apple's, but the question is still the same: what about profits?
Profits in high-end batteries can be guaranteed, but in the middle and low end, because of the nature of polymer batteries, it is very difficult for Wells Fargo Energy to reduce costs, otherwise it is not a new type of battery. The cost of a single block is 60, and after counting the tariffs, the profit is limited.
On the other hand, Zong Yan also began to investigate Apple's new battery.
He brought the answer: "Not only Apple, but Samsung, Panasonic and some other companies are working on new batteries, and we can say that we work with any of them, and they will not stop working on their own new technologies to get rid of our products that are too expensive." ”
"It's all the same cunning." Meng Qian had experienced it before.
"Business dictates." Zong Yan is not surprised at all, "Samsung itself is also developing graphene batteries and graphene-coated lithium batteries, and it is not easy to break through." ”
Meng Qian understood: "It's all wolf ambitions, and it is estimated that patent lawsuits will be indispensable in the future." ”
Zong Yan said: "Tomorrow afternoon, Samsung's Korean CEO will talk to us by phone. ”
"I know." Meng Qian wrote it down, and he still had to talk to a higher official.
In the afternoon of the next day, Meng Qian chatted with the other party about international calls.
But the actual business discussion was still very different from what Meng Qian expected. Stick, both parties must obediently bow their heads, and then take a win-win situation that everyone is happy with, that is, both parties will collect protection money, and then cooperate to achieve the most perfect ending.
It's a pity that business is rarely perfect, Samsung may accept this kind of "peace talks", but Apple will not agree, they just want to be exclusive, its strong capital reserves, can always be maintained at a higher level than Samsung, so that it is difficult for rich country energy to abandon them.
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