Chapter 68: Group Purchasing, give me some discount…

In business, seeking profit is a common practice. It is reasonable to negotiate for favorable terms and seek the best possible outcome.

As Zhu Yunwen observed the back-and-forth exchange between the two sides, he couldn’t help but smile. Regardless of the outcome they would reach, the interests of the royal family were guaranteed.

The Ministry of Revenue and the Ministry of War were clearly at a disadvantage in the argument against the two kings. This seemingly simple scenario actually involved numerous economic knowledge.

The issue of seller’s market versus buyer’s market is evident, and it is currently a seller’s market.

The Ministry of War and the Ministry of Revenue both recognize the benefits of medical gauze and alcohol and are aware of the high demand and limited supply. They are fully prepared to make the complete purchase. At this moment, the two kings have the upper hand and can set the price according to their preference, displaying strong bargaining power.

Another issue is the problem of information asymmetry.

As the sellers, the two kings state that the production cost is seven maces. However, the Ministry of Revenue and the Ministry of War, as the buyers, have no knowledge of the true cost and have not seriously considered what the actual cost might be. They simply think that the pricing, although high, seems reasonable.

In the future, businessmen used this approach to employ tactics like hunger marketing and false advertising, reportedly making a lot of money. Although Zhu Zhi and Zhu Geng don’t know Adam Smith and haven’t read “The Wealth of Nations,” they understand a simple principle:

The goods are in my hands!

The price is under my control.

Seeing that the Ministry of Revenue and Ministry of War cannot convince the two kings any further, They are preparing to settle the transaction at nine maces per box. Xie Jin sets aside his teacup and looks at the two kings seriously, saying, “Seven maces, at most seven maces.”

Zhu Geng disagrees and says, “Secretary Xie, seven maces is only our cost. If it’s set at that price, how can the two mansions sustain themselves?”

Xie Jin shook his head and said, “The cost mentioned by King of Liao, maybe its true, but two kings also need to understand it cost seven maces to develop, once production is scaled up and daily output increases, the cost will be diluted. After six months, the cost may be as low as four or three maces. Ministry of Revenue purchasing at price of seven maces is already advantageous for the two kings.”

Zhu Geng looked at Zhu Zhi with some hesitation. After calculating for a while, Zhu Zhi said, “The minimum is eight mace.”

Xie Jin was about to argue further when Zhu Yunwen knocked on the table, and everyone’s gaze turned towards him.

“In my opinion, the medical gauze and alcohol can not only be used for soldiers but also be distributed to the Six Ministries and provincial governments. In other words, this procurement is a collective purchase by the court and involves a significant quantity. Why not offer some concessions?”

Zhu Zhi wore a pained expression and looked at Xie Jin before sighing, “Since His Majesty has spoken, I will step back. If the Ministry of Revenue is willing to sign a contract for two hundred thousand crates, then let it be at seven maces.”

Ru Chang, Huang Zicheng, and others were delighted. After discussing among themselves, they believed that procuring only two hundred thousand crates was insufficient. The Capital garrisons alone required at least fifty thousand crates to be kept in stock, and another hundred fifty thousand crates were needed to be transported to the border.

Moreover, these are consumable goods, not something that can be purchased today and be enough for the whole year. Once consumed, they need to be replenished. Two hundred thousand crates are far from enough.

“Here’s the proposal: the Ministry of War will procure three hundred thousand crates at seven mace per crate, with delivery in increments of ten thousand crates. Once the transaction of three hundred thousand crates is completed, subsequent procurements will be negotiated separately. Is that acceptable?” Ru Chang earnestly proposed.

Zhu Zhi and Zhu Geng nodded in agreement.

Under the witness of Zhu Yunwen, the two princes and the Ministry of War signed the procurement contract, with the Ministry of Revenue and the Grand Secretariat providing their signatures as guarantees.

Everyone was satisfied with this outcome.

After the departure of the two kings and others, Xie Jin and Zhu Yunwen discussed how to handle the issue of the land and estates of the two kings. Zhu Yunwen’s idea was simple: to divide the land and convert the tenant farmers of the kings’ estates into self-cultivating farmers. In the future, the tax would be collected based on the output of the land, following a Single Whip method.

Xie Jin agreed and then said, “Your Majesty, Single Whip method has encountered resistance in the Jiangsu-Zhejiang region. Yan Qiliang has reported that the local gentry at the grassroots level are resisting and refusing to cooperate. They can’t even determine who owns the land, making it difficult to proceed with land measurement and they hope the court can make decisions.”

Zhu Yunwen looked at the setting sun and said, “If no one claims ownership of the land, then it becomes ownerless land. Since it is ownerless land, let’s distribute it to those who have no land or limited land. Inform Yan Qiliang and the provincial administration offices in the Jiangsu-Zhejiang region to issue notices to local administration offices, setting a deadline. If anyone fails to clarify or manage the land, from the lowest-ranking officials to the provincial administration commissioner, they will be stripped of their official positions and assigned to be responsible for land measurement.”

Xie Jin chuckled. With such high pressure, how could things not get done?

Those individuals had studied hard for decades, finally managed to climb up the ladder, and obtained official positions. If they were to be removed from office, it would be a great loss. Compared to the small benefits offered by the local gentry and aristocracy, preserving their official positions was the most important.

Xie Jin accompanied Zhu Yunwen as they walked in the palace, finalizing many matters in their conversation.

Zhu Yunwen admired Xie Jin greatly. Xie Jin was highly talented, capable of handling affairs with insight and foresight. He was an excellent candidate for the position of prime minister.

It’s no wonder that in history, Zhu Di exclaimed, “The world cannot be without me for a single day, and I cannot be without Xie Jin for a single day.”

Zhu Yunwen only used four words, “Ah, Merchants are good,” but Xie Jin understood his intentions completely. Step by step, they cooperated and ultimately took over the kings’ estates, granting the kings the status of imperial merchants and avoiding future criticism and accusations regarding their commercial activities.

“Your Majesty, how should we arrange the entry of the King of Yan into the capital?” Xie Jin inquired.

Zhu Yunwen pondered for a moment and replied, “The King of Yan is highly talented, and it concerns the future military system. We mustn’t neglect it. You shall go on my behalf and have Five Army Commandery nobles join to welcome Zhu Di into the city tomorrow at noon.”

Xie Jin bowed and said, “I will follow your orders.”

Seeing that it was already dusk, Zhu Yunwen told Xie Jin, “Prepare yourself early.”

Xie Jin performed a salute and left the palace.

Kunning Palace.

When Zhu Yunwen arrived, Ma Enhui greeted him with a gentle smile. Before she could pay her respects, Zhu Yunwen helped her up.

“The Empress is in a good mood?” Zhu Yunwen couldn’t help but smile when he saw Ma Enhui’s cheerful expression.

Ma Enhui pointed to the abacus by her side and said, “Your Majesty, I just calculated it. The military procurement by the Ministry of War amounts to thirty thousand crates, each priced at seven maces of silver. If we calculate it this way, we will receive two hundred and ten thousand taels of silver. I never imagined that such a small amount of gauze and alcohol could yield such profits.”

Zhu Yunwen looked at Ma Enhui helplessly. It seemed that there were never any costs in her accounting books.

“Empress, out of the two hundred and ten thousand taels of silver, we need to pay fourteen thousand taels as taxes…”

“What? What is the Ministry of Revenue doing? They collect fourteen thousand taels of tax from two hundred and ten thousand taels? Isn’t it supposed to be a 1/30 tax rate according to our commercial laws, which means only seven thousand taels should be taken? Your Majesty, you need to intervene on my behalf!”

Ma Enhui felt wronged. Losing seven thousand taels of silver out of thin air, how could she not feel heartbroken?

Zhu Yunwen spread his hands, lacking confidence, and said, “Empress, it is I who implemented this policy…”

Ma Enhui widened her eyes, looking at Zhu Yunwen in disbelief. Zhu Yunwen nodded.

It’s over.

Sleeping in Kunning Palace is no longer an option.

Zhu Yunwen lamented silently. Capitalists are indeed not easy to deal with…

With nowhere else to go, Zhu Yunwen had a meal in the Imperial Kitchen. He chatted with the eunuchs and palace maids until midnight. It was only when a strong wind blew in the night that he made his way back to Kunning Palace.

Passing by Chengqian Palace, Zhu Yunwen paused.

Shuangxi saw Zhu Yunwen looking in the direction of Chengqian Palace and asked, “Your Majesty, are we heading to Chengqian Palace for the night?”

Narrowing his eyes, Zhu Yunwen asked, “I remember that Chengqian Palace operates day and night without stopping.”

Shuangxi smiled and nodded, saying, “Indeed, Lady Luo has divided the workers into three shifts for round-the-clock production.”

Zhu Yunwen frowned and pointed towards Chengqian Palace, saying, “Listen, besides the sound of the wind, there are no other noises.”

Shuangxi listened carefully and indeed heard no sounds of production.

“This is not good, something has happened!”

Zhu Yunwen suddenly felt uneasy and hurried towards Chengqian Palace.

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