Chapter 105: Who Agrees, Who Opposes (1/2)

While Zhao Qingfeng and Shen Lingyao were studying, a tense and formal shareholders’ meeting was taking place at the headquarters of Erlunsi in the provincial city. Thanks to the butterfly effect of Zhao Qingfeng’s previous efforts to resolve a crisis for Liu Li, significant changes had already occurred at Erlunsi headquarters, and a conspiracy was being urgently implemented.

Chairman Li Jianjun had been sitting in the meeting room all afternoon. He was in his fifties, of medium height, with a broad nose and a square face. At this moment, he sat in the main seat, holding many reports and statements, frowning and squinting as he carefully examined them. The situation outlined in the reports was not optimistic; the losses were becoming increasingly severe and were nearing the company’s bottom line.

After a while, he turned to look at the dozen or so shareholders who had just arrived. Confirming that no one was missing, he took a deep breath, put down the documents, and began to explain the current state of the company’s reform and market analysis situation.

“Gentlemen,”

“Regarding the light-asset operation mentioned in the preliminary notice to you, the company is currently in an experimental phase. However, whether we can truly expand this on a large scale requires unanimous approval from all of you.”

“I believe you have all carefully read the annual report from last year and the financial reports from this year’s quarters on your way here.”

“You are also aware that the call for China to join the WTO is getting louder, and the competition previewed in the market is becoming increasingly fierce.”

“It’s not hard to imagine that once China truly joins the WTO, the pattern of global economic trade will definitely change, and the intensity of domestic competition will exceed our imagination, thereby continuously compressing our profits.”

“Once profits are compressed, the overall operational situation of the company will be more severely affected, leading to many negative chain reactions.”

“Based on Erlunsi’s loss situation in the past two years, we are now unable to bear the potential foreseeable risks that may arise. If we continue to follow the old development and marketing strategies, within a year, our overall market coverage and economic revenue ratio will reach a point of halving again or even worse.”

“Therefore, I firmly believe that our company must reform, and it is imperative.”

Li Jianjun, as the CEO, naturally had the ability to analyze the market. Erlunsi was founded by his advocacy. Since 1995, he personally invested 1 million, and with an additional 11 million in financing from the shareholders present, he developed the company into a large corporation with nearly one hundred million in capital in just under seven years.

But now, he felt he was getting old and somewhat unable to understand the market, especially in the last two years. Whether it was changing the sales approach or innovating the overall layout, it failed to completely reverse Erlunsi’s downward trajectory.

According to the 2000 annual report, the company’s overall profits had declined by nearly 35% compared to 1999. 2001 was even worse. The financial reports for the first two quarters showed that the profits for the first half of 2001 had nearly halved compared to the first half of 2000, a nearly 50% decline.

Not to mention other cities, just the closure of stores in the Ji Province alone had reduced the number from the original 180 to the current 75, and the closures due to losses were continuing.

So now, he urgently needed a method for complete change. Not only to save Erlunsi but also himself. The suggestion made by Manager Zhang was good; the five words “light asset operation” struck a chord with him like a voice from heaven. For him, who had always been seeking an opportunity for transformation, it was undoubtedly a lifeline.

As long as he could persuade the shareholders to agree to the transformation, Erlunsi might indeed be able to continue operating with this ‘flash of inspiration’ and turn losses into profits.

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