Chapter 957 – Internet + Physical business

That day, after the dinner was over, Feng Yu saw that woman holding on to Kirilenko’s arms and left the ballroom with him!

Is that woman not the daughter of some bigshots? But Feng Yu does not want to interfere, and Kirilenko had brought his bodyguards with him. Nothing will happen.

The next day, a refreshed Kirilenko went to look for Feng Yu to discuss their new business. His asset had increased by four times suddenly, and he doesn’t know what to invest in.

Kirilenko felt it’s still safer to cooperate with Feng Yu, as he does not need to worry about anything and can still make high profits.

“Brother Ki, I remember you telling me that you are in the retail business?” Feng Yu took a sip of coffee and asked.

“That’s right. But I am selling imported goods from China, West Europe, and America. I don’t sell our domestic products.”

Only do imported goods retail sales? This should be evolved from Kirilenko’s trading company. The demand for China products in Russia had dropped, and Kirilenko started to bring in goods from other countries.

“Brother Ki, do you have your physical shops?”

“Yes. But not a lot, as I am mainly into wholesale businesses. But many retailers are working with me. If you have any good products, I can guarantee it will be selling all over Russia, Ukraine, Belarus, etc. in the shortest time.” Kirilenko patted his chest.

Kirilenko thought Feng Yu has some wonderful products to sell, but he hopes it’s not beverages.

“Brother Ki, are there big supermarkets in Russia?”

“Yes. Two supermarket chains are currently doing well, but they cannot compare to Tai Hua Supermarket. They are only selling daily necessities. Are you asking me to open supermarkets? No…, this will not work. Those two supermarket chains had taken up all the good locations in the cities, and it will be difficult to compete with them.” Kirilenko waved his hand.

Last year, when Tai Hua Supermarket Group started, Kirilenko ordered his men to look into this business for Russia. But all the good locations for supermarkets were taken up. It is hard for him to enter this business unless he is going to open supermarkets in second-tier cities. But what’s the point of doing that?

There might be profits from the second-tier cities, but it does not suit Kirilenko’s character. He is Russia’s top importer and wholesaler. How can he go to second-tier cities?”

“Brother Ki, you had not found the right position for your supermarkets. They are selling daily necessities, and you can set up an imported goods supermarket.”

“Imported goods supermarket? You are saying that I will only sell imported goods in my supermarkets?”

“That’s right. You can only sell imported goods. Don’t worry. I know some of your Russian products are popular, but those products are not produced in Ukraine and Belarus, right? If you sell the Russian products there, isn’t it considered imported goods? The taxes between Russia and those countries are low, and your cost will not be high. Furthermore, those products are only to supplement your supermarkets, and will not be the main products you are selling.”

“What will be our main product?”

Feng Yu rolled his eyes. “It’s the imported products from Asia and the western countries, of course! Electronic products, food items, clothing, books, daily necessities, etc. Just these items alone are enough for you to set up a hypermarket!”

“There is money to be earned from these?” Kirilenko hesitated.

“Did you make money from being a whole seller? Did the retail stores that bought your goods make money? Many imported products are very popular in your country. You can take reference from our Tai Hua Supermarket’s imported section, and you will know how much will the profits be.”

“How much must I invest?”

“I suggest buying the land first. We can rent it, but if anything happens, our supermarket will be affected. If we are forced to move, we will lose lots of customers. We also need to prepare funds to import goods, renovations, and fittings, etc. It will be better if we have our own logistics company. If you want everything to be in place, it should be around 3 billion USD.”

“3 billion USD? So much?! It’s just a retail business, how much can the profits be? Even if we are selling imported goods, we still need to compete with two other competitors.” Kirilenko is shocked. This investment is ridiculously high.

“Listen to me first. This 3 billion USD includes 100 supermarkets and a gigantic logistic team. If possible, I suggest buying cargo planes to ensure your goods will arrive in every city in your country. Of course, this includes other major cities in East Europe.”

“Wait… you are saying that we will be opening supermarkets in every major city? 100 stores? Is it too many? How many Tai Hua Supermarkets do you all have after so many years?”

“Tai Hua Supermarket group is planning to set up 50 hypermarkets next year, and we estimate we will have 300 stores within five years, forming a monopoly. Furthermore, I am not asking you to invest everything at once. You can split it into a few phases.”

“Supermarkets are so profitable?”

“We can surely make money, and there is another advantage. Supermarkets can use monthly, quarterly, or even annual credits. This way, the supermarkets will have a high volume of cash, lowering your investment risks in other areas, and you don’t have to worry about cash flow issues.”

Other than casinos, the supermarket has the highest cash compared to other industries. Some supermarket chains have more cash than casinos.

When have you heard of supermarkets having cashflow problems?!

“Then why do we need to have a massive logistic team? Do we still need cargo planes? Even if I can afford the transportation cost, but how much money can I make from them?”

“That is because you don’t have enough orders. What if you have lots of orders? Have you heard of online shopping?” Feng Yu is speaking like those multi-level marketing company’s salesmen.

“Online shopping? What is that?” Kirilenko is confused.

“It is ordering items off the internet. Do you know about telephone orders? It is the same, except you are using the internet now. There will be pictures of the product on the internet, and it can showcase the product better than those catalogs.”

“How are the customers going to pay?”

“They can pay upon receiving the goods or use online banking. This model had just started in the US, but it is still not available in Europe. If we can pull it off, we can control the whole European market!”

Feng Yu is exaggerating, but he felt it is not impossible. This business model can be easily copied by others, but Feng Yu believes that it is not a problem to take over the Russian speaking countries in East Europe.

“Will customers believe in online shopping?” Kirilenko is skeptical.

“That’s why we must allow the customers to pay when they received their products.”

“What if the customers refuse to pay after they received their goods?”

Feng Yu raised his brows. Brother Ki is not as stupid as he looks and can still think of this.

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