Chapter 130 - The Crazy Expansion of Aimeigao Company
With huge capital in hand, Lin Haoran felt full of confidence. Judging from the recent trends in international gold prices, it was obvious that the pace of increase had accelerated, and the longer he delayed entering the market, the higher the gold entry price would become. Therefore, he needed to head to the United States as soon as possible to secure his position in the gold futures market. His departure time was set: on the morning of June 3rd, at 9:38 AM, he would fly from Hong Kong's Kai Tak International Airport to New York, USA. Traveling with him would be two bodyguards and Su Zhixue. Su Zhixue was familiar with all aspects of investment operations, and having him along would be very convenient.
On the morning of June 2nd, Lin Haoran first dealt with the affairs of Wan'an Group and Qingzhou Cement Company. In the afternoon, he made a rare visit to Aimeigao Company. Since securing that massive order last year, Aimeigao's fan orders had been quite average during the winter and spring seasons. Nevertheless, they still made four to five million Hong Kong dollars in monthly profits because many of the American distributors sold not only in the U.S. but also expanded their markets into Central and South America. These regions, being close to the equator, needed fans year-round. Even in the U.S. and Canada, despite winter and spring, there was still demand, especially for new buildings or renovated properties where ceiling fans were installed in advance.
However, since late April, Aimeigao's orders had surged again. Although Lin Haoran didn't yet know exactly how much profit had been made last month, he knew the company was overwhelmed and had to continue expanding the factory and increasing its workforce. Leaving Qingzhou Cement Company, Lin Haoran headed straight to Kwun Tong. Half an hour later, he arrived at Aimeigao's factory.
It was worth noting that at the beginning of last month, due to the surge in orders, Liu Luanxiong decided to rent the entire industrial building. He had called Lin Haoran about it, and for such a small matter, Lin Haoran readily agreed. After all, with summer approaching, orders would skyrocket, and these two years, this summer and the next would likely be the most profitable periods for the fan industry. Originally, the fourth floor was occupied by another tenant, but due to poor management, they closed down hastily at the end of December last year, forfeiting even their deposit. That's business: not everyone wins; more people lose than succeed.
Thus, Aimeigao could rent the entire building, and the industrial park's management even offered a significant discount. After more than half a year, the park's occupancy had only increased from about 20% to 30%, meaning rental competition was still fierce. Renting the whole building was highly welcomed by the owner.
When Lin Haoran last visited Aimeigao in mid-May, it had been more than ten days ago. He noticed immediately that there were even more employees now. On the first and second floors, the factory was bustling. On the third floor, passing through the warehouse and employee rest area, he arrived at Aimeigao's newly expanded office area. Initially, Aimeigao's offices had been on the second floor, quite small. But with the expansion of middle and senior management, more space was needed.
Departments such as quality control, marketing, R&D, accounting, procurement, and human resources had all been established early in the year, leading to a more streamlined and efficient organization. Thus, when they rented the first and third floors, they designated part of the third floor as a new office area. Entering the executive office area, Lin Haoran saw several department heads busy at work, including Financial Director Lai Meihui.
"Good afternoon, President Lin," greeted the staff warmly as he passed.
Lin Haoran smiled and greeted them in return. "Director Lai, where's General Manager Liu?" he asked, noticing Liu Luanxiong's office was empty.
"General Manager Liu went to Kwai Chung this morning. We have a shipment going to the United States today. He insisted on overseeing it personally and should be back soon," Lai Meihui explained.
Lin Haoran nodded. "Please get me last month's financial report," he said as he walked into the reception lounge and sat down.
Soon, Lai Meihui brought the financial report to Lin Haoran. Even though he had anticipated good results, Lin Haoran was still shocked by the numbers. Last month's order total reached 11.09 million US dollars, with profits of 3.4389 million US dollars. That meant a monthly profit of 18.22 million Hong Kong dollars.
And due to risk management, Aimeigao now required deposits before production and full payment upon delivery. In other words, there were no accounts receivable. Thinking back to what he had read in his previous life, Aimeigao started as a small workshop and, in less than three years, had earned Liu Luanxiong more than 100 million Hong Kong dollars. Liu Luanxiong owned only half the company yet had accumulated such wealth, despite spending much time operating out of a tiny workshop with modest profits. Thus, the real big money had been made during just two years, mostly in summer. Given that, it was no wonder a good month now could rake in tens of millions.
Compared to other markets, orders from the Americas were indeed more straightforward. Since the oil crisis had dragged on, rising oil prices meant that government slogans promoting energy saving were now internalized by the people. After May, temperatures in the U.S. started climbing, and fans became essential household items. If May was already this profitable, June's numbers would surely be even crazier.
After sitting in the reception room for half an hour, Lin Haoran saw Liu Luanxiong hurriedly returning. "Haoran, what brings you here today?" Liu Luanxiong asked, surprised.
"I'm heading to the U.S. soon, so I thought I'd visit before leaving," Lin Haoran explained.
Liu Luanxiong nodded and sat across from him. "Today, we had a shipment going to Los Angeles. Everything's loaded now. The American and Canadian distributors keep pressing us for more products. I've boosted production as much as possible, but it's still not enough," Liu Luanxiong said, complaining yet clearly thrilled.
"Thank you for your hard work," Lin Haoran said with a smile.
"It's not that hard anymore. Since I followed your advice and built a more professional management team, our operational efficiency has improved dramatically. My personal burden has also decreased significantly. Now, I don't need to personally manage every detail," Liu Luanxiong explained.
"How's this month's order situation? Last month's results look excellent," Lin Haoran said, waving the financial report in his hand.
"This month's orders are already fully booked through the end of the month. Even after renting six floors, our production can't fully meet demand. We didn't expect the European market to take off either. Europe accounted for 20% of our orders last month, and now it's up to 30%. I'm planning to rent the neighboring industrial building too. If we can fulfill all orders, our monthly profits could double," Liu Luanxiong said excitedly.
In just over half a year, Aimeigao's growth had been insane. Last year, it was just a tiny workshop with fewer than 100 employees. Now, monthly profits exceeded 10 million Hong Kong dollars, and the workforce had grown close to 5,000 people, putting it into the upper-middle echelon of Hong Kong's manufacturing sector. If they rented the neighboring building and doubled production, employee numbers would surpass 10,000 — making Aimeigao one of Hong Kong's manufacturing giants.
"Rent it," Lin Haoran said without hesitation. "This boom won't last forever. As long as the market isn't saturated, we must seize every opportunity."
In Hong Kong, manufacturing wages were usually calculated by piecework or hourly rates. Since Aimeigao's workers were paid by a comprehensive piece-rate system and orders were endless, wages were very good. However, during winter, with fewer orders, wages would drop, leading dissatisfied workers to leave — keeping the workforce flexible.
"Good point," Liu Luanxiong agreed. "I'll negotiate with the industrial park owner today. By mid-month, our production capacity should double, allowing us to take even more orders."
"Ah Xiong, while expanding, don't neglect quality control. Our success in the Americas is largely due to superior quality. A major quality failure could severely damage our reputation," Lin Haoran reminded him.
"Don't worry. Quality control remains our top priority. Every product must pass strict inspections before shipping. If a defect is found, it's immediately repaired — no defective product leaves our factory," Liu Luanxiong assured him confidently.
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