CHAPTER 343: CHAPTER 343: THE BANKRUPT DRONE COMPANY

"For any typical offline factory, having a 5% net profit margin already allows them to live comfortably.

But a brokerage platform manages to exceed a 10% profit margin. On what grounds is this happening?"

Chen Yiyang wasn’t impulsive in deciding to enter the food delivery field.

He ensured that his team conducted thorough research first.

Ugly Group’s profit margin is too high. It’s abnormal, and not what a monopolistic industry company should be doing.

Online platforms should assist physical businesses in earning money, instead of achieving their own profitability by exploiting these entities.

Brick-and-mortar stores are like water, and online platforms are like boats.

Without water, the boat simply cannot sail.

Therefore, Chen Yiyang plans to enter the food delivery sector, aiming for a profit margin of around 3% for his platform, which would be satisfactory.

"Alright, I understand." Liu Xiaoyue had experience in factories previously and knew that Ugly Group’s profit margin was genuinely unusual.

Because if you’re in a labor-intensive industry, the more you earn, it only indicates that those working under you are getting less.

A typical example is of Yonghui Supermarket boasting on stage about how much profit they made this year.

Yet below, the boss of Shoudonglai couldn’t sit still and directly went on stage to question why, despite earning so much, haven’t they raised employee wages?

Ugly Group is currently in that situation.

On one hand, Ugly Group’s cash flow is ridiculously abundant. On the other hand, its delivery riders lack security, and merchants are being squeezed by various subsidy-themed activities.

Obviously, the food delivery industry has problems, and everyone should point fingers at the platform. In the end, it becomes a debate among customers, delivery personnel, and restaurants.

After briefing Liu Xiaoyue, Chen Yiyang sought out Yang Chengru.

"That’s the situation. Initially, I intended to pull Jindong into this food delivery venture, but Jindong hasn’t made a decision yet."

Thus, I plan to proceed solo, but I’ll need some support from Lin’an City initially."

"If you’re genuinely sincere about starting this venture, Lin’an City is definitely supportive."

Yang Chengru immediately said, "Feel free to set your conditions, and if the city can accommodate, it will."

"Alright," Chen Yiyang nodded.

"By the way, I also have something," said Yang Chengru, "Do you remember Lin’an’s drone company from before?"

"I remember." Of course, Chen Yiyang recalled.

He had helped this company establish connections to sell drones to South Korea.

But due to this deal being exposed, he recently dared not go to South Korea anymore.

"South Korea tore up the order, leaving the company with a substantial debt. The owner intends to sell the company and is looking for a buyer. Are you interested?"

Chen Yiyang frustratingly scratched his head.

This matter indeed has some relation to him.

If not for his reasons, then the matter of the company selling military drones to South Korea wouldn’t have been exposed.

However, upon tracing back, it was that South Korean intermediary who leaked the information.

"How much does he plan to sell the company for?" Chen Yiyang scratched his head, deciding to ask the price first.

"Around 300 million." Yang Chengru replied.

"That cheap?"

"300 million is quite a bit." Yang Chengru thought. When I first knew you, you had but any factory worth less than 100 million under your name.

And now, in such a short time, even 300 million is considered small money?

This isn’t entirely Chen Yiyang’s fault.

Primarily, Yiyang Automobile and the delivery platform, which he is busy with, each require initial investments upwards of billions.

Comparatively, 300 million indeed isn’t much.

"But let me state upfront." Yang Chengru added, "The reason this drone company needs selling isn’t due to technical incapability, but a lack of orders. If you take over, you will also face this issue."

"I’ll give it my best shot."

Chen Yiyang has his ideas.

The company’s drones can be sold as military drones to South Korea, indicating technical capability.

Currently, Europe is ramping up related military product manufacturing. Through Schaefer’s connections, he dismantles drones into parts, ships them for reassembly there, and sells to their military, which isn’t impossible.

Since Jindong isn’t interested in the delivery field, he plans to sell all his Jindong shares, netting himself dozens of billions in cash; spending 300 million to play isn’t out of the question.

After discussing with Yang Chengru.

In subsequent days, Chen Yiyang entertained Wu Changxun once more.

Wu Changxun came concerning Tengxu’s investment in Yiyang Automobile.

Tengxu proposed: valuing Yiyang Automobile at 20 billion, Tengxu acquiring a 10% stake, thus investing 2 billion cash.

After signing the contract with Tengxu’s representatives.

Chen Yiyang finally told Wu Changxun, "By the way, I’m planning to venture into the food delivery sector recently; this won’t affect our relationship, right?"

"No problem, no... wait." Wu Changxun reflexively answered, before realizing what Chen Yiyang actually said.

"You’re planning to enter the food delivery industry?"

"Yes." Chen Yiyang replied, "I believe the era of Ugly Group’s dominance should end."

"You’ve truly given me a surprise." Wu Changxun was at a loss for words.

Simply because Ugly Group’s biggest shareholder is Tengxu.

Tengxu directly holds 20% of Ugly Group’s shares, while Ugly Group’s founder only holds 11%.

Tengxu invested in Yiyang Automobile, yet now Chen Yiyang intends to battle Ugly Group in the food delivery sector.

"Brother, you’re quite doing something here." After hesitating for a long while, Wu Changxun struggled to find words.

Finally, he squeezed out, "Well, best of luck!"

After Wu Changxun left, Chen Yiyang kept a close watch on Ugly Group for several days.

Then noticed Ugly Group had no response.

Why would they?

Chen Yiyang’s instant delivery barely set up a base in Lin’an City, hired only a few dozen delivery riders.

Moreover, its chief clients remain state-owned enterprises, brought on board by Yang Chengru.

The main earnings come from subsidizing state enterprise employees, encouraging them to place orders on the instant delivery platform.

Chen Yiyang estimated that after Wu Changxun had a brief chat with Ugly Group’s people.

Ugly Group’s founder and real controller Wang Xing called for an investigation, revealing the instant delivery as such a minor platform, deciding simply not to bother.

Ugly Group’s reaction is pivotal for Chen Yiyang.

Because Chen Yiyang deduced from Ugly Group’s response that his delivery platform wouldn’t pose any immediate threat to Ugly Group.

To gain momentum quickly, he must collaborate with Jindong.

But how to persuade Liu Qiangxi to get Jindong into the food delivery sector?

Chen Yiyang faced quite a dilemma temporarily.