My Galaxy Technology

Do you support price reduction?

Within Tianle Materials, someone made this suggestion.

The cancellation of orders is a major blow to most companies, especially the cancellation of large-volume orders, which can lead to orders for millions of pieces of products.

Only companies with a certain monopoly nature that never have to worry about selling will not be afraid or care about the cancellation of orders by some customers.

But Tianle materials are obviously not.

Tianle Materials is in the second echelon, at the same level as Tianfeng Chemical's optical materials, but its scale is far from being able to compete with Tianfeng Chemical.

Tianfeng Chemical has long made an internal decision, and even the big boss Akio Tianfeng has acquiesced. Once it cannot bear the losses, Tianfeng Chemical will directly enter China's domestic optical materials market.

Tianle Materials is not that capable. Once it loses the Chinese domestic market, Tianle Materials' revenue will be cut by more than half, and then the development of these years will be in vain. It will be difficult to turn around in the future, and even It can be concluded that the only outcome in the future will be elimination in the optical materials industry.

Companies such as Darong Technology and Hesheng Technology are general customers of Tianle Materials. If they lose, they will lose. Over time, there will be many more customers of these companies.

Qianyin Technology's cancellation of in-transit orders is a severe pain for Tianle Materials, which is equivalent to a large piece of meat being taken away from the thigh.

Whether the optical materials used by Qianyin Technology are supplied to Zhongzheng Company, Oppein Company, or some other mid-range mobile phone brands, including some foreign customers, most of them are purchased from Tianle Materials, and the two have strategic cooperation. The relationship was determined by the top management of the two companies.

But now, the top management of Qianyin Technology has obviously not been able to withstand the temptation of large price cuts and promotions for optical materials such as Wangzhe Materials and Feiyang Optics, and has begun to take action against Tianle Materials, a former close friend.

I don't want to either, but their prices have been reduced too much.

Tianle Materials had nothing to do. Apart from sending an email to explain that the materials for the order in transit had been prepared and could not be cancelled, there was nothing else to say.

Behind closed doors, we immediately discussed what to do.

They knew things were coming to a head. When an industry boss fights with a powerful rookie challenger, the boss is fine, and the rookie challenger is also particularly brave. Then it is the turn of bystanders in the same industry to suffer, especially since this bystander is still in the third position.

In this current situation, we can only sell at a reduced price.

The domestic general manager of Tianle Materials thought about it, but in the end he just sighed.

If you participate in a price war, you will definitely suffer huge losses or even go bankrupt in the end.

But if you don’t participate in the price war now, you will die immediately.

After so many years of operation, it is so intricate that until the last moment, no one is willing to give up what they have now. Even if they know that it is drinking poison to quench their thirst, they still have to bite the bullet and drink.

In Bangzi, the heads of the headquarters of Tianle Materials Company quickly learned the news. After intense negotiations, the result was the same. Just follow it first, and wait until you can't stand it anymore.

Tianle Materials wants to reduce its price by 15%?

Pengcheng, Qianyin Technology.

Purchasing Director Lin Panpan's mood suddenly deteriorated a lot after receiving an email from Tianle Materials stating that he could not cancel the order. Although I received a call from the general manager of Tianle Materials later, saying that Tianle Materials could reduce the price by 15% in conjunction with the cost reduction and efficiency increase of their mass production project, my mood was still not much better.

It is necessary to reduce costs and increase efficiency of mass production projects. When can it become a bargaining chip in negotiations and forcefully reject the customer's decision to cancel orders?

This is the hard part of doing business. The price of a product from the beginning will drop all the way as mass production continues. When the product is no longer sold on the market, the price reduction will even exceed half. The same is true for raw materials. You may sell them to customers for 10 yuan per piece at the beginning, but the more you mass-produce, the price can reach 5 yuan or even 4 yuan, which is simply outrageous.

Among them, of course, the price of raw materials has shot up a lot. The second reason is that as mass production continues and production yields increase, the actual cost of the product is decreasing.

Qianyin Technology is the third largest mobile phone ODM manufacturer. Although it does not have many projects for the four major mobile phone brands: Zhongzheng, Oppein, Wheat, and Weiwo, it makes many off-brand phones and copycat phones, and the volume is also very large.

The orders placed in a year are usually in the tens of millions or hundreds of millions.

With the price reduction of King Materials, the top management of Qianyin Technology immediately started to reduce costs and increase efficiency. In addition, Lin Panpan had previously approached Tianle Materials to reduce prices, but the target price reduction was not achieved. Therefore, after Lin Panpan reported his ideas to the leadership, he issued the order to cancel the follow-up. Order Decision.

Now, the price of Tianle materials is going to be reduced?

late!

Lin Panpan sneered. In fact, the project and research and development had already prepared several mass production plans, including those for King Materials and Feiyang Optical Materials. It's just that the prices of the two previous companies have remained high, resulting in the cost being unable to be verified. Now that the price reduction is so large, the cost has come down immediately, and it is even more cost-effective than Tianle Materials' solution.

Well, whether it’s research and development, production, or even quality, we want to be the king of materials.

There is a very simple reason. The polymer optical film of King Materials has excellent performance, there are basically no defects in the production process, and the reliability and other experiments are also 100% without problems.

Unlike Tianle materials, there will still be a certain proportion of defects in the production process, which is extremely annoying to production and quality, and also annoying to R\u0026D, because if such bad production quality occurs, R\u0026D will be in trouble.

As for reliability experiments, let alone that. It is true that customers will not conduct experiments on every mobile phone released by Qianyin Technology, but random testing is still required for each batch. Many times, spot tests will reveal defects, which will immediately lead to customer complaints. This is something that production and quality absolutely don’t want to see.

Taken together, everyone definitely wants to use the King Material solution.

Feiyang Optics has not yet been mass-produced by Qianyin Technology, but it has been sanctioned by Yingjiang and targeted by King Materials. Obviously, it cannot lose at all in terms of performance.

Immediately, Lin Panpan added an email, writing down the time of placing the order and the time required for production and delivery, etc., and strongly requested to cancel the order.

Here, there is an unspoken rule, that is, there is no actual order for your goods. If the customer wants to cancel, you generally have to cooperate with the cancellation, otherwise you will not want the order in the future.

Lin Panpan calculated very clearly. She placed a lot of orders for Tianle materials, but so far she has not delivered even one-fifth of them. What's wrong with canceling three million pieces?

After sending the email, Lin Panpan took a breath, then called one of his purchasing managers and asked, What did Tianfeng Chemical say? Are you willing to cooperate with the price reduction?

The purchasing manager shook his head and replied: Tianfeng Chemical stated that the current price is their bottom line, and they will lose money if it lowers it any further, so they refused.

Lin Panpan was not unhappy, but asked doubtfully: Don't they know that both King Materials and Feiyang Optics are reducing their prices?

It's time, the boss has already lowered the price, but you, Tianfeng Chemical, the thousand-year-old second-in-command, still don't lower the price, you don't want to be around anymore? For a moment, she didn't understand what those people who were living a good life thought. Could it be that they were really living a good life?

I said it, but they said it was the rule of the headquarters. They also said that if the price must be reduced to accept the order, then they would rather not make the order.

Lin Panpan was speechless. After thinking for a while, he couldn't figure it out. Finally, he said angrily: Forget it, ignore them. If you don't want to lower the price, don't lower the price. Arrange the transfer order immediately!