Chapter 38 Identifying Business Opportunities
As one of the three pillar industries of the traditional economy in the United States, the steel industry plays a core role in economic development.
The second half of the 19th century
With the development of the western United States and the construction of the Central Pacific Railroad across the east and west coasts of North America, the American steel industry has made great progress, accelerating to catch up with the world-leading industrial powers such as Britain, Germany and France.
In 1877, U.S. steel production climbed to the level of 1.57 million tons, with an output value of more than 40 million US dollars, ranking fourth in the world, second only to Britain, Germany and France, the three traditional powers.
American entrepreneur Andrew Carnegie introduced six sets of state-of-the-art open-hearth steelmaking methods, and became one of the four steel giants in the entire American steel industry.
The Fischer family, located in San Francisco, is the supplier of steelmaking equipment to Andrew Carnegie American Steel, which is imported from industrial powerhouses such as Britain, Germany, Italy and France, which is among the top in the world today.
The next day, the San Francisco Bay Area.
Accompanied by Congressman Fischer, Li Fushou visited Fischer International Trading Company and saw the brand-new converter equipment imported from Germany in the warehouse area, as well as hundreds of other sets of equipment, covering a wide range.
This visit had a great impact on Li Fushou and his entourage.
The tall warehouses are stacked with shiny machinery and equipment, which are the essence of science and technology since the steam industrial revolution in Britain, Germany and France, showing the infinite power of heavy industry and driving the rapid development of the entire country's economy.
The most advanced steelmaking equipment comes from Germany, which is the latest invention of open-hearth steelmaking equipment by Mr. F-Siemens, a German-British, which is improved and innovated on the basis of the British blowing converter, and a special flame furnace is added to increase the furnace temperature, and the output of high-quality steel has been greatly increased.
"Look, Mr. Li, the machinery and equipment you see now show the highest industrial level in Europe, the main equipment comes from Britain and Germany, and this set of equipment alone can produce 150,000 tons of high-quality steel per year, which is a very staggering number."
Mr. Fischer Sr. is a Jewish-German who has run the family business for 10 years and knows the inside scoop of international bulk trade, and he is proud to demonstrate the strength of the family business.
150,000 tons?
It's a surprising number, not because it's more, it's because it's less.
Li Fushou's expression on his face was not shocked, it was quite novel at first, but later he felt that it was like this.
Four words to sum it up; Stupid, big black coarse
Siemens, a German manufacturer of open-hearth steel-making equipment, seems to be preparing to make this set of open-hearth steelmaking equipment last for 10,000 years.
With an annual output of 150,000 tons of steel, it was disliked by rural workshops in Greater China in later generations, and the output was too low.
In today's world, it is amazing, you must know that the annual steel output of Fuso is less than 10,000 tons, the Qing Dynasty is a little more limited, Russia and Austria-Hungary are only tens of thousands of tons of level, all of them are handmade iron workshops on the local law.
Walking down in a circle, Li Fushou's calm performance was secretly surprised in the eyes of old Fisher;
Sure enough, he is a royal descendant who has seen the world, and he can't pretend to be calm and calm.
"Is the price only 166,000 pounds? You must know that we not only order a complete set of steelmaking equipment, but also order rolling mill production equipment, pressure water hammer and steel forging equipment, and even a set of drawing and drilling equipment, which should be a very large list. ”
Fischer International Trading Co., Ltd. has a wide range of channels and has been working in the field of steel machinery and equipment for decades, Li Fushou wisely chooses to cooperate comprehensively, rather than going around blindly and losing time and money in vain.
Jews are the most credible in doing business, and they will not smash their own signboards.
Old Fischer laughed twice, raised three fingers, and said; "Dear Mr. Lee, I have three reasons to satisfy you.
First, according to your requirements, almost all the extension of the steel product industry line, after completion, it not only has an annual production capacity of 150,000 tons of steel, but also has the production capacity of thick steel plates, steel beams, billets, steel pipes, steel bars and thin iron sheets of marine specifications, forming a complete steel production base.
Fisher International has tested the high-quality iron ore and coal samples you brought, and the high-quality iron ore grade reached 67%, and the coal is also a high-quality deposit, so we are very recognizable to your strength and have confidence in the in-depth cooperation.
Our equipment is world-class, with impeccable quality and performance to bring you maximum benefits.
The total equipment is priced at 227,660 pounds, including the entire process of equipment installation and commissioning by Fischer International from the installation and commissioning of the equipment to the successful trial production, and to teach your workers step by step to provide the perfect solution.
It's very difficult to do that, and we are the only company on the West Coast of North America.
Second, Fisher International can accept half of the cash delivery, and then pay off the remaining 30% of the remaining half of the payment, and the remaining 70% can be paid with agricultural and animal husbandry products and iron ore.
We have calculated that this is a £83,181 deal in agricultural and animal products, including leather goods, canned goods, flour, smoked ham, pure wool yarn and toffee, and iron ore, which is believed to be a great boost to the Red River Valley ranch.
This is our way of honoring you and hope that there will be opportunities to deepen our cooperation in the future.
Third, through the mature channel of Fischer International Trading Company, we are willing to contribute to the entry of Red River Valley ranch products into the United States and even the European market, and facilitate the education and further education of Red River Valley ranch personnel.
If your steel products are good enough and the price is right, it can also facilitate the return of goods to the U.S. market.
Your Excellency, this is the sincerity we have shown, and we hope to be recognized by you. ”
Speaking of which, what else could you not be satisfied with?
I have to admire the talent of the Jews to do business, after a business is done, people feel like they have eaten ginseng fruit, and the 365 pores are full of comfort.
A full set of steel equipment and extended industrial equipment, because it is a world-class product, the price is of course also world-class, which is nothing to say.
Wanting good things but not willing to pay is not the right posture to do business for a long time, this is to play others as big fools, and in the end it is yourself who plays to death.
You get what you pay for.
Trying to keep prices down will only make suppliers look for cheap second-hand equipment or outdated old equipment, and in the end it will be you who will suffer.
The sincerity shown by the key Fisher International Trading Company, especially the full set of high-quality services coupled with the sincerity of barter trade, is enough to make Li Fushou resolutely determined.
"Very good, I am very satisfied with this cooperation, the full set of steelmaking equipment will be loaded and shipped immediately after the commissioning of our ocean-going freighter is completed."
Li Fushou waved his hand and decisively decided;
"In addition, we need to order a complete set of equipment for coal mining and coking plants, flour mills, meat processing plants, canneries, woollen mills, tanneries and slaughterhouses, please arrange them as soon as possible."
"Please rest assured, I will contact the relevant manufacturers as soon as possible, be sure to provide the best quality service, and make every effort to promote the successful completion of this major cooperation."
"Thank you very much!"
Li Fushou smiled and nodded, and then threw a bombshell; "If the equipment of the steel plant is running well and achieves the expected purpose, we will continue to order 2~3 sets of open-hearth steelmaking facilities no later than three years, and I hope to continue to cooperate at that time, which is my commitment."
It was really pie in the sky, and the smashed old Mr. Fischer was dizzy, and every fold on his face bloomed, not to mention how happy he laughed.
Needless to say, Congressman Fischer did his best to escort this major cooperation and eliminate all unnecessary interference.
No one can earn too much pounds of real money.
The Fisher Trading Company will not work day labor, and the agricultural and animal husbandry products imported through barter trade must have a large profit margin, which is a win-win result.
Li Fushou is very satisfied with this cooperation, why did he suddenly propose to buy coking coal plant equipment?
Through the investigation, Li Fushou found a huge business opportunity.
In today's world, high-quality coking coal is expensive and has huge profit margins.
The high-quality coking coal imported by U.S. Steel from Germany is worth $22.5 per ton, which is simply a money grab!
To know
In the world market, high-quality steel is only 24 US dollars a ton, and the fluctuation is no more than 0.5 US dollars, which is almost the same.
Although it is incredible, it is determined by supply and demand, and existence is reasonable.
The North American continent lacks high-quality coking coal, and high-quality coking coal must be used to make some high-performance ship plates.
For example; Today's thriving steam high-speed cruise industry on the Atlantic route requires high-performance steel products, including ironclad ships, heavy artillery, gun barrels, heavy-duty railroad tracks, and large steam engines.
It is correspondingly more expensive and can afford the high cost of high-quality coking coal in Germany.
Every month, U.S. steel companies alone import 2~3 ships of high-quality coking coal, with a total amount of more than 10,000 tons.
How much is there demand in the United States?
Li Fushou inadvertently discovered this great business opportunity, and he was overjoyed.
What I didn't say,!
Even if you can mine your own coal mine, even if you use your own electricity, even if your coking plant is running at full capacity, high-quality coking coal can be produced, and your own ocean-going ships can be vigorously transported, and all you earn is green dollars.
Li Fushou is now in a hot fight with Congressman Fischer, and the two sides have a close relationship, and now they live in the Fisher family's vacation villa in the Bay Area.
When it comes to entering the North American market, it is necessary to have its own spokesperson, and Congressman Fischer is a good choice.
The two sides hit it off, and the tacit understanding is all in self-evident.
The Fischer family has deep roots in California, and their status as a senator of Congress has given them considerable influence over the capitalists.
If coking coal wants to enter the North American market, sales are an unavoidable difficulty, and Mr. Senator comes in handy.
We can use all aspects of our relationships to bring Australia's high-quality coking coal to market.
The result?
Li Fushou also has no bottom in his heart, today's American capitalists are very bullish, they can only take one step at a time, at least many times stronger than the Chinese.
U.S. Steel for example;
Carnegie was a very influential big capitalist in China, known as the steel king by the newspapers, and it was difficult for him to influence this big man with the rank of Senator Fischer.
The average little person can't even get into the office door.
U.S. Steel imports high-quality coking coal from the Ruhr region in Germany, and the cooperation between the two sides is smooth, so why buy coking coal from the Red River Valley in Australia?
With Carnegie's arrogant and stubborn character, it was difficult, almost impossible, to move him.
The steel industry in Detroit and Philadelphia is very developed and is in full development, and the amount of high-quality coking coal required is definitely increasing year by year.
And this ...... It's the opportunity for the Red River Valley.