Peng Zhaoyang’s visit was specifically arranged by Yang Huailin. On one hand, he felt his own influence was insufficient, so he proactively reported Lu Hao’s situation to the town leadership.
On the other hand, once Lu Hao was confirmed to assist Yang Li Village, the town government would need to provide support in terms of land and agricultural loans.
Upon hearing that Lu Hao was the president of Hanhua Group, the town leaders attached great importance to it, as Hanhua Warehousing was a leading department store and retail giant in the province, and goods entering Hanhua were circulated throughout the province.
If the agricultural products from Yang Li Village and even Xinqiao Town could enter Hanhua’s sales channels, it would be a tremendous opportunity for the economic development of Xinqiao Town.
“Hello, Mr. Lu. Director Yang only told me last night that you were coming here for an inspection, otherwise I would have come sooner. Welcome to Xinqiao!”
After Yang Huailin’s introduction, Peng Zhaoyang warmly shook hands with Lu Hao.
Lu Hao smiled politely, “Town Mayor Peng is too kind. I will be coming here often in the future because my brother Yang Jian is here.”
“It’s great that you’ll be coming often. Young Yang is a good lad. Not only is his template factory doing well, but he’s also using his own money to build roads. He has vision and ambition, and is someone who can achieve great things. Mr. Lu, please offer him your support.”
Lu Hao cut to the chase, “Naturally. Director Yang, as time is a bit tight, let me first share my initial thoughts. For Yang Li Village’s agricultural products to enter our company’s sales channels, two issues need to be resolved.
First, the pesticide residue in vegetables must not exceed the standard. I’m not sure if the town has a professional and authoritative testing agency, as all agricultural products entering supermarkets must have a test report.”
This condition completely stumped Yang Huailin. He had no idea that the vegetables grown in the fields required test reports; he had never heard of such a thing before.
Peng Zhaoyang, however, understood and quickly interjected, “Mr. Lu, we can contact the District Bureau of Quality and Technical Supervision to arrange for them to set up a branch office. I will handle this matter.”
Lu Hao nodded, “Second, a professional trading company is needed to liaign with us, because we cannot purchase agricultural products from individual farmers. This company must have a certain economic strength.
This is because our company settles accounts on a monthly basis, so this trading company will need to advance funds for one month.
Furthermore, this trading company will need to build large cold storage facilities and equip transportation vehicles, which also represents a considerable expense.”
This requirement also stunned Yang Huailin. Where could he find such a powerful company?
Peng Zhaoyang was also taken aback, not expecting that cooperating with Hanhua Company would not be so simple. However, their requirements were indeed reasonable. With so many farmers, they couldn’t possibly have the supermarket send people to acquire products from each household, could they? That would require too many people.
Yang Jian thought for a moment and asked, “Brother Hao, I remember seeing a Hanhua Warehousing Distribution Center by the roadside when I returned from Xichuan last year. Isn’t that one of your company’s facilities?”
“Yes, we have established a distribution center in every prefecture-level city. The goods for supermarkets in this region are all allocated by the distribution center, including agricultural products.”
“Then can’t you set up a distribution center here as well?”
“Your location is too remote. Distribution centers are generally located next to national or provincial highways. Even if there is a distribution center, this trading company will still need to advance funds and build cold storage.”
Peng Zhaoyang immediately said, “The main road of our town connects to Hancheng in the west and Chengguan and Hongzhou in the east, and it is a national highway connecting line with convenient transportation.
Moreover, an exit of the Hanhong Expressway has been confirmed to be located three kilometers west of the town, and it will be open to traffic next year. At that time, it will take thirty minutes to get to Hancheng and one hour to Hongzhou, which should meet the conditions for building a distribution center.”
Lu Hao smiled at him, “Since the town mayor is so enthusiastic, I will discuss it with my team when I get back and arrange for people to conduct an on-site inspection. We will ask Town Mayor Peng to arrange the liaison then.”
“No problem, as long as Mr. Lu is willing to have the distribution center located in our Xinqiao, we will provide all convenient conditions.”
Peng Zhaoyang clearly understood that the relocation of the distribution center to Xinqiao would not only drive the external sales of local agricultural products but also provide opportunities for other goods to enter Hanhua Warehousing’s circulation channels, playing a very important role in revitalizing the local economy.
Yang Huailin asked dejectedly, “Mr. Lu, what about the trading company? We don’t have any companies with such strength here. Why don’t you introduce one? Otherwise, your assistance plan cannot be implemented.”
Lu Hao pondered for a moment and said, “Little Yang, you should establish this trading company. I will arrange for a professional team to guide you in its operation.”
Yang Jian was a little surprised, “I’ll run the trading company? How much money is needed?”
“Building a thousand-square-meter cold storage facility would cost around 1.5 million yuan, plus working capital, transportation vehicles, and other expenses such as land acquisition and factory buildings. Four to five million yuan should be sufficient.”
“Don’t joke. Where would I get the money for this now?”
“This matter is not very urgent. You can establish the company and acquire the land first, which won’t cost much. Sign contracts with farmers and plan the types of agricultural products to be grown, as agricultural products do not grow in one or two months. You will have enough time to raise funds.”
“It would be more like it in half a year. I definitely won’t be able to come up with so much money in the next few months.”
Yang Jian had done the math. Although the casino had millions of yuan in income per month, it could only maintain the operation of the template factory and the construction of Chunfeng Tower. He also had to build roads, buy a car, and renovate two houses, one as his own wedding house and the other for his sister.
“It’s alright. It will take us several months to build the distribution center. If there are still funding issues at that time, I will help you find a way. This is for the benefit of the common people, so you need to show some courage and not be hesitant.”
Lu Hao was guiding Yang Jian onto the right path, as mixing with the gambling world was ultimately a dead end.
Seeing Yang Jian still hesitating, Peng Zhaoyang nudged him, “Don’t worry, take on this project boldly. I will help you apply for a loan.”
“Loans again? The credit union rejected my application last time. I don’t want to bother them again.”
“Don’t worry, I’ll handle this matter and make sure you don’t have to worry about it.”
“Alright then, I’ll consider it. It’s too sudden, and I have no idea where to start.”
This industry was completely unfamiliar to Yang Jian, so he couldn’t just jump into it impulsively.
Lu Hao clearly understood Yang Jian’s concerns, “It’s alright. I’ll arrange for people to come in a few days to first assess the feasibility of building the distribution center and then help you prepare the trading company.”
“Okay then, what preparations do I need to make?”
“Find a few trustworthy people to form a team, and I will arrange for people to train you. These people will be liaising with the farmers, and it’s easier to communicate with locals. As for the company’s management personnel, they will need to be recruited, which requires a certain level of education and logistics experience.”
Lu Hao intended to establish a proper, large-scale trading company integrating production, processing, transportation, and distribution in one go, and the cooperation would not be limited to their Hanhua Group.