flstandardbreds Chapter 104 Expanding Sources of Wealth
Chapter 104 Expanding Sources of Wealth
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Liu Ye had thought of building commercial housing before, and now he could take advantage of the new city construction to implement it.
However, Li Fu still didn't quite understand: "Craftsmen? Although their wages are higher than in Guangdong, they still don't save enough money in a year to buy land and build houses! If we sell houses at a low price to win them over, won't we lose money?"
"Hehe, that's because you don't understand the installment payment trick!"
Liu Ye explained that craftsmen's incomes varied, and no matter how much money they had saved, they wouldn't easily spend it, let alone on something as important as buying land and building a house—besides, many of them might have planned to save enough money to buy a house and land in their hometown. Buying a house on installment, with only a small payment required to get a ready-made house, was incredibly attractive to people in ancient times who dedicated their lives to buying houses and land. It seemed like a great deal with little risk—at most, the loss would be the initial payment, and this small risk would be exchanged for a large house that would allow the whole family to live in peace and prosperity, making it an undeniably worthwhile investment.
Having bought a house and settled down, they naturally wouldn't easily leave Lingao, and the artisans they had painstakingly trained wouldn't be lost—although they could be forced to stay with bayonets, Liu Ye didn't intend to use such a low-level tactic, which would not only damage his image, but also leave the artisans who were forced to stay with little enthusiasm for production.
Li Fu's business acumen shone through once again. He instantly grasped the meaning of installment payments: installment payments are like boiling a frog in lukewarm water—the amount paid each time won't hurt, but the cumulative effect is quite considerable, only the returns are slower. The craftsmen will only see the lower initial payment and the advantage they're gaining, without caring about the final cost. Even more ingenious is that since the factory and houses are Liu Ye's properties, if the craftsmen use their wages to buy houses, then the wages Liu Ye pays will effectively return to his own pocket, freeing up cash for other expenses.
Li Fu thought it over carefully and found it feasible. He admired the master to the point of prostration. If the master hadn't been against kneeling and bowing, he would have knelt down and worshipped him.
For Liu Ye, this was nothing new; it was simply a simplified, abridged version of the real estate model from later generations. In modern society, the ultimate goal for working-class people is to own a house. While ancient laborers preferred land, housing was still essential for survival and was highly valued. Using real estate to retain artisans and simultaneously recoup capital was a win-win situation, while also paving the way for future real estate development—this was why he insisted on reserving land for commercial areas. Only with thriving commerce could the foundation for real estate development be laid.
After dealing with this pile of tasks, Liu Ye had only one word echoing in his mind: "Money! Money!"
New artillery pieces, new warships, and the construction of new cities are all money-burning projects with no immediate returns. Meanwhile, the salaries of the guards and the wages of the craftsmen cannot be neglected. Selling houses to the craftsmen is the beginning of the real estate industry, but its effectiveness remains to be seen. Besides, compared to the enormous expenditures, even if successful, the revenue would be far from sufficient.
The profits of Wan Hua Lou are ultimately limited and cannot support increasingly heavy expenses. Before it has sufficient military strength to protect itself and carry out maritime trade, it is time to launch new products to increase revenue.
He said to everyone, "The important backlog of business has been temporarily put on hold. While everyone is here, let's brainstorm together and see what we can come up with that can be as successful as Wan Hua Lou and alleviate the financial pressure—relying entirely on Wan Hua Lou in Hangzhou is not a long-term solution."
Liang Xiaoming nodded and said, "That's true. Before we start the war on maritime trade, we really need to broaden our sources of revenue and share the burden of Hangzhou Wanhualou."
Upon hearing this, everyone began to rack their brains.
"In my humble opinion, for a business to thrive, it either needs to be like the Wanhualou in Hangzhou, winning with its four famous courtesans and innovative model, or it needs to continue to offer something new and rare, making it unique and unparalleled..." Yan Guang expressed his opinion.
"Novelty, huh..." Liu Ye recalled when he and Liang Xiaoming went to Shilu to inspect the iron mine and discovered quartz sand outside Changhua County. "Do you think glass counts as a novel object?"
"Glass?" Yan Guang stroked his beard. "Nanjing has many nobles, but not many can afford to install a few glass windows in their homes. It is said that this material was transported from the Franco-Portuguese region thousands of miles away, and it is extremely fragile and expensive."
"So, Mr. Yan, do you think glass will sell well?" Liu Ye asked, intrigued.
"If it's glassware, it's not worth much; porcelain is more common. Large panes of glass windows or small mirrors are probably quite valuable..."
In fact, many glass vessels had already entered the Ming Dynasty, but they never became mainstream because porcelain was more practical in daily life: Firstly, glass is more fragile and prone to shattering when heated, while porcelain is not only less fragile but can also be used even with chipped edges; secondly, glass gets hot to the touch when holding hot items and cools down quickly without retaining heat, while porcelain remains cool and cools down more slowly; thirdly, and most importantly, porcelain was cheaper. These three reasons meant that glass vessels remained a novelty and plaything in the Ming Dynasty, unable to replace porcelain.
Liu Ye quickly asked Liang Xiaoming, "Can you make glass windows and glass mirrors?"
Liang Xiaoming shook his head: "I might be able to make a glass ball, and with some experimentation, I might be able to blow a glass or something, but the technology required for large flat glass is too advanced. I probably can't make one with my limited skills. As for mirrors, forget about it. The requirements are even higher than for ordinary flat glass. If the mirror surface isn't smooth, it'll become a funhouse mirror..."
Liu Ye was quite disappointed; even humanoid computers have their limitations.
At this moment, Li Ergou stood up and cautiously said, "Master, I have an idea, but I don't know if it will be useful?"
"You tell me, you tell me, three cobblers are better than one Zhuge Liang!" Liu Ye waved his hand, urging him to speak boldly.
"When I was young, I worked as a waiter in Fucheng. I loved to drink, but I couldn't afford good wine. I could only occasionally buy a pound of Hakka rice wine or local liquor to drink slowly. The rice wine was sweet, but not as strong as the local liquor. The local liquor was strong, but the taste wasn't mellow and it was too spicy. Once, I saw the boss drinking, and the aroma was so fragrant that I couldn't resist. I took advantage of the boss being drunk and stole a few sips. I still remember the taste. It was smooth on the palate, with a pure aroma, and very strong. One cup made me drunk..."
Everyone laughed, and Li Fu said with a smile, "Li Ergou, you probably don't have a high alcohol tolerance. You get drunk after just a small cup?"
Li Ergou argued, "I can drink a whole jar of other wines and a few cups of local liquor, so how can I have a low alcohol tolerance? It's clearly good wine with a strong kick..."