Chapter 54: Rising Costs
The news of the new continent certainly whetted the appetite of almost all the countries on the continent, but they also understood that it was pointless to talk about it when they did not have the conditions for ocean navigation.
In contrast, it is more important to stabilize one's own development first, because only in this way can there be hope to successfully seize the opportunity to develop the new continent when it presents itself.
If you have fallen behind before this, it will naturally be a matter of course.
As a result, as the news of the New World was made public by the New Flying Chamber of Commerce, other countries on the Sainz Continent became more and more invested in the development of the magic industry.
The chambers of commerce under the Xinfei Chamber of Commerce receive applications for cooperation from various chambers of commerce, countries and other forces on the mainland almost every day, which makes almost everyone up and down the Xinfei Chamber of Commerce very busy.
In fact, the busiest and most popular is undoubtedly the Xinfei Home Magic Machinery Chamber of Commerce led by Ankato.
Now on the continent of Sainz, household magic machinery has been deeply rooted in the hearts of the people, and everyone understands that household magic machinery can bring great convenience and comfort to life, so more and more chambers of commerce have invested in the household magic machinery industry.
In the first four months of this year alone, more than 100 chambers of commerce have applied to the Xinfei Chamber of Commerce to purchase technology related to household magic machinery, and the technology purchased covers all the technologies that the Xinfei Chamber of Commerce has officially sold and transferred.
In order to meet the huge demand from the outside world, the Xinfei Chamber of Commerce announced at the beginning of this year that it would open an additional 37 household magic machinery-related technologies in response to the appeals of countless people, including the manufacturing technology of high-end products such as magic air conditioners and magic refrigerators that have not been announced by the Xinfei Chamber of Commerce.
In this way, virtually all the technology related to household magic machinery that the New Flying Chamber is currently able to produce will be sold and transferred. As a result, some of the household magic machines that were unique to the Xinfei Chamber of Commerce in the past now have the ability to be produced by other chambers of commerce. The new flying chamber of commerce has lost its exclusivity.
Of course. The new flying chamber of commerce is still far ahead of other chambers of commerce in terms of technology and technology, even if it is the same thing, the products of the new flying chamber of commerce are still significantly stronger than the products of other chambers of commerce in terms of quality and performance.
In addition, the Xinfei Chamber of Commerce has become a symbol of magic machinery in the minds of everyone in the Sainz continent, and has a high reputation and prestige, so no matter which country it is in, Xinfei household magic machinery is still the most popular product, and it is definitely not sold.
As we enter June, this advantage is once again manifested as in previous years.
According to the report of the Xinfei Household Magic Machinery Chamber of Commerce. This year, the sales of Xinfei brand household magic machinery have once again increased significantly compared to last year, and the total sales in May alone reached 1.7 million gold coins.
However, after accurate statistics, it was found that compared with last year, the net profit of the Xinfei Household Magic Machinery Chamber of Commerce was significantly lower than the increase in sales, although it also had a large increase.
The reason for this phenomenon is that with the increasing number of chambers of commerce that can manufacture household magic machinery, the prices of various raw materials are also rising, coupled with the increase in labor costs, the manufacturing cost of household magic machinery has increased significantly. This leads to lower profit margins.
A few years before the establishment of the Xinfei Chamber of Commerce, the profit margin of the Xinfei brand household magic machinery could be at least more than 50%. It can even reach a staggering 80%.
And in recent years, with the popularity of household magic machinery, the profit margin of Xinfei brand household magic machinery has been declining.
According to statistics this year, among the new flying brand household magic machines, the magic air conditioner with the highest profit margin is only less than 30% of the profit margin, and the lowest magic lamp has a profit margin of less than 10%.
Judging from this phenomenon, it can even be said that the era of profiteering of domestic magic machinery has passed.
Although Xu Yi expected this, he didn't expect it to appear so soon.
You know, on the earth, the home appliance industry has only appeared after decades of development.
And on the continent of Sainz, it has only been more than sixteen years since the appearance of domestic magic machinery.
However, after thinking about it carefully, Xu Yi could only reluctantly admit that this situation was actually caused by himself.
Because he has always had the intention of vigorously promoting the magic industry, he has almost no reservations about the technology of household magic machinery, so that now many chambers of commerce have the ability to manufacture household magic machinery, which directly shares the sales of Xinfei brand household magic machinery, triggers competition, and thus reduces the profit of Xinfei brand household magic machinery.
The increase in the cost of raw materials and labor is also inseparable from him.
Let's start with the manual aspect.
Before the Xinfei Chamber of Commerce, although the chambers of commerce on the Sainz continent did not have a fixed value for the salary level of the employees they hired, for ordinary employees, no chamber of commerce would give much salary.
Seventeen years ago, when the Xinfei Chamber of Commerce was just established, for example, the highest salary offered by the Chamber of Commerce in Bangta City was only ten gold coins per year.
As soon as the Xinfei Chamber of Commerce was established, it actually offered a high salary of five gold coins per month to its ordinary employees.
That's 60 gold coins a year!
This salary was an extremely exaggerated amount for Bangta City, where most people could barely go hungry at that time, and even the entire Lampari Kingdom, so much so that almost everyone in the entire Bangta City felt that Xinfei Chamber of Commerce and Xu Yi were crazy.
However, it is precisely because of this that the Xinfei Chamber of Commerce was able to quickly hire enough people to quickly meet the needs of mass production, so that at the beginning, the Xinfei Chamber of Commerce was not even bothered by the output.
At the same time, this also made the reputation of the Xinfei Chamber of Commerce soar, which indirectly helped the Xinfei Chamber of Commerce to develop rapidly.
From this point of view, for the Xinfei Chamber of Commerce, this is more beneficial than disadvantageous.
But for other chambers of commerce that also entered this industry after the Xinfei Chamber of Commerce, the salary standard set by Xu Yi at the beginning was undoubtedly a heinous crime.
Because the Xinfei Chamber of Commerce has been in front of the pearl and jade, the standard has been set. If other chambers of commerce want to enter the magic industry in the future. It would not be possible to offer lower salaries. Otherwise, it will be impossible to recruit people, and it is even more impossible to poach skilled workers from the Xinfei Chamber of Commerce.
So over the years, because of the competition and poaching of various chambers of commerce, the salary standard has risen again and again.
Until now, the salary of the Xinfei Chamber of Commerce does not seem to be high, and it can even be regarded as low among all the chambers related to the magic industry industry, while the salary standard of other chambers of commerce is much higher.
This, in turn, affected the New Flying Chamber of Commerce.
Previously, when Xinfei's household magic machinery department had not been separated, it still stuck to the salary standard set by Xu Yi. No one complained.
After the establishment of the Xinfei Household Magic Machinery Chamber of Commerce, Ankato reformulated this salary standard in order to improve the morale of the chamber of commerce personnel and establish his own prestige, so that the salary standard of the Xinfei Household Magic Machinery Chamber of Commerce was raised to a higher level in the entire magic industry related chambers of commerce.
As a result, the labor cost of the Xinfei Household Magic Machinery Chamber of Commerce immediately rose, just in May alone, the salary and various welfare expenses were as high as 630,000 gold coins, which was a great increase compared to before, thus greatly increasing the cost of the Xinfei brand household magic machinery.
Then there's the raw material aspect.
When the New Flying Chamber of Commerce was first established, the people of the Sainz continent did not pay much attention to the various raw materials needed to produce magic machinery. Therefore, among all the raw material costs of the Xinfei Chamber of Commerce, the largest cost is the part of the magic materials needed to draw the magic array.
As for the iron ore with the highest consumption, although it is controlled by the Falcao Chamber of Commerce. But the price is not high.
And the magic crystal, which is also very important, can be said to be as worthless as giving it away for nothing because it is almost everywhere.
Since then, as the magic industry has become more and more important, all countries on the mainland have also paid more and more attention to the raw materials related to the magic industry in their own countries.
Naturally, the price of these raw materials is also increasing.
Taking the iron ore with the highest demand as an example, the price of iron ore purchased from the Falcao Chamber of Commerce in the first few years was only about two gold coins per ton, and the pig iron that had been smelted was only about ten gold coins a ton.
And this year, according to the latest prices published by the Falcau Chamber of Commerce in June.
Iron ore has risen to six gold coins per tonne, and pig iron has skyrocketed to twenty-seven gold coins per tonne.
It's more than double the amount it used to be!
Even the magic crystals, which were completely worthless in the past, except for the particularly pure high-end goods, were thrown on the ground and no one looked at them, but now they have become an energy source that all magic machines must use, so the price has skyrocketed.
For example, the price of the magic crystals that the New Flying Chamber of Commerce purchased from the Candela Empire that could only meet the medium standard had already reached ninety-three silver coins per ton.
Moreover, because the demand for magic crystals is huge, the price is increasing rapidly.
At this time last year, it was only seventy-six silver coins per tonne, but a year later, it has risen to ninety-three silver coins per ton.
At this rate, there is no pressure to break through one gold coin per ton this year.
The demand for raw materials has been accompanied by a crazy rise in prices, which naturally leads to a series of problems.
First of all, all the countries on the continent of Sainz have strengthened their control over various raw material resources in their own countries, led by the two major empires of the Candela Empire and the Maro Empire, and a large number of countries do not export raw materials at all.
Even the only person in the Candela Empire who can trade raw materials is the Xinfei Chamber of Commerce, because the Xinfei Chamber of Commerce is the only one that has mastered the technology of steel smelting, non-ferrous metal smelting, and magic crystal concentration and refining.
In addition, the Candela Empire and the New Flying Chamber of Commerce have a number of cooperation projects, so the New Flying Chamber of Commerce can continue to purchase all kinds of raw materials from the Candela Empire without restrictions.
However, no matter how much they are discounted, the price of these raw materials still increases dramatically, which leads to an increase in the cost of manufacturing magical machines.
If this is the case with the Xinfei Chamber of Commerce, the situation of other chambers of commerce and other countries on the mainland is even more conceivable.
Countries with sufficient raw material resources in their countries can say that countries that are not rich in resources themselves will naturally have to think of other ways to solve this problem.
And one of the most common and prone to these methods is war. (To be continued......)