Chapter 257 Financial Status
Fengkai is already one of the top agricultural machinery manufacturers in the country.

Therefore, the updating and expansion of Donghe agricultural machinery and agricultural implements are not a problem; the problem lies in the operators of the agricultural machinery.

When it was first established, Donghe Agricultural Machinery not only undertook the tillage, sowing and harvesting within Jiahe, but also extended its service tentacles to the surrounding areas.

Today, Donghe Agricultural Machinery employs about 200 agricultural machinery operators and logistical services, and has more than 3,000 machines and equipment of various types as well as maintenance and refueling facilities.

In addition to large and medium-sized tractors, combine harvesters and other large agricultural machinery, there are also deep tillers, rotary tillers, various types of silage mowers, seeders and other agricultural machinery.

Covering areas such as forage, wheat, corn and soybeans,
Mechanization standards have been established, mainly combining deep tillage, precision seeding, inter-row tillage, deep tillage, mechanical weeding, mechanical harvesting, and the combination of agricultural machinery and agronomy.

It has basically realized the full mechanization of farming, planting and harvesting. It integrates agricultural machinery sales, maintenance, agricultural machinery operation, trusteeship services, technical training and intermediary services.
It has become a mechanized force with a modern atmosphere that is active in fields all over the country and can be described as a torrent of agricultural machinery.

However, in the past two years, with the rapid development of the group, especially the two million acres of land in the Asafoetida Gobi, Donghe’s connection with the outside world has gradually been severed.

During this period, domestic agricultural machinery specialized cooperatives also sprang up like mushrooms after rain.

Among them, some Donghe operators returned to their hometown because they could not stand staying in remote places where no one lived all year round.

These people are veterans and have accumulated rich farming experience through several years of agricultural machinery operation and service.

After returning to his hometown, he took out a loan to buy one or two Fengkai agricultural machines, contracted dozens or hundreds of acres of land, and then planted corn and wheat for farmers in surrounding towns and villages and plowed the land.

It can not only solve the urgent needs of surrounding farmers, but also earn service fees.

After a year, I lived a very comfortable life and took care of my family.

The brand awareness of Fengkai agricultural machinery has also been greatly improved as a result. Therefore, Jiahe also encourages and supports drivers who return to their hometowns to start businesses.

In order to retain more skilled operators, Donghe Agricultural Machinery has also made some adjustments to welfare benefits.

Including wages + social security + benefits, the average monthly labor cost per person is about 2,500 yuan, and the annual minimum wage expenditure is about 6 to 7 million yuan.

Add to that the maintenance services, fuel, freight, and other annual costs of agricultural machinery, and Donghe Agricultural Machinery can basically only maintain operations.

It is not an easy task to complete equipment upgrades and expand the team on your own.

In fact, strictly speaking, Donghe Agricultural Machinery also made a profit, and earned a lot of iron towers.

After two or three years of high-intensity operation and allocation, the hundreds of tractors and machines initially purchased by Donghe are now free of cost.

That night, Cai Bin thought about it alone for a long time.

Donghe Agricultural Machinery was basically developed by Zhang Wei and him, and he is very clear about the ins and outs of it.

It also has its own performance appraisal mechanism.

But he always felt it wasn't enough.

So, the next day, after getting up early in the morning, he set out from Jinta and arrived at the group headquarters at just after seven o'clock.

I happened to see the boss coming out of the cafeteria after breakfast.

He felt strangely shocked.

The boss is here so early?

Didn’t you just come back from a business trip?

He hurried to the cafeteria to eat breakfast. The cafeteria at the headquarters was unusually rich, with steamed buns, noodles, soy milk, eggs, and hot pot...

Employees can choose what to eat.

Cai Bin simply prepared a bowl of noodles; the chewy texture tickled his taste buds, and the beef in the bowl was also quite generous.

He didn't bother to taste it for too long. He finished it in no time and went to his boss' office.

...

Guo Yang arrived at the company early in the morning, had breakfast, made a cup of tea, and began to study financial statements and financial planning.

But after a while, there was a knock on the door.

"Please come in."

"boss"

Guo Yang looked up and saw a sturdy man walking in. He was stunned for a moment before he recognized that it was Cai Bin.

"Come so early?"

"That's not even as early as you, boss!"

"Get a chair and sit over here." Guo Yang said. Donghe Agricultural Machinery had always let Zhang Wei do what he wanted.

The group's various farming tasks are successfully completed every year, and it has also contributed to the promotion of Fengkai agricultural machinery products.

So when Zhang Wei returned to his hometown to start a business, Guo Yang felt very painful, but he also chose to bless him and part ways amicably. He was sure that there would be opportunities for cooperation in the future.

After a while, Cai Bin moved a chair and sat down opposite Guo Yang's desk.

Only then did he see a pile of documents neatly stacked on the boss's desk.

Cai Bin suppressed his emotions and said, "Boss, I plan to make a major upgrade to Donghe's batch of agricultural machinery."

"Tell me?"

"The agricultural machinery workload this winter and throughout next year is very heavy, and it is difficult to complete the tasks with the existing machinery and manpower."

"Donghe's current debt is almost over. The first two batches of Cheetah tractors and some supporting machinery can be sold as second-hand, which can solve most of the funds, and loans can also solve part of it."

Cai Bin paused and said, "For the rest, we may need the group to provide some additional funding."

Guo Yang raised his eyebrows and thought for a while before he stood up and found two folders in the filing cabinet by the wall.

One of them was left behind by Zhang Wei before he left.

Guo Yang just scanned it briefly at the time, but was later delayed because of the anti-counterfeiting work.

He gave Cai Bin the information Zhang Wei had left behind and said, "Take a look at this, too. These are some suggestions Zhang Wei made."

Guo Yang started looking at Donghe's statistics.

As of the third quarter of 2006, the total value of Donghe agricultural machinery reached 1.22 million yuan, with a total power of 17.9 kilowatts.

It has 307 large and medium-sized tractors, 3 bulldozers, 27 corn planters, 21 corn harvesters, 215 sets of forage harvesters and balers, plant protection machinery, sprinkler irrigation equipment, trenching machines, stone pickers, sand pumps, and special transport vehicles...

A long list of fixed assets.

Some also count the operating area.

For example, the two Fendt 930s have had many opportunities to show their prowess over the years.

In four years, the cumulative operating area of ​​each machine has reached millions of acres. Based on the purchase cost, the cost has long been recovered.

However, its main supporting hydraulic tipping plow is now almost in a state of being scrapped.

And it can't be repaired.
One reason is that it is imported equipment, and the other is that Guo Yang used natural energy and mechanical fragments to transform it, and its dozens of plowshares were greatly strengthened.

They work non-stop for 24 hours a day and can deep plow four to five thousand acres of land.

However, long-term work in the Gobi Desert, which is full of rocks, will inevitably cause the blade to crack or even break.

In addition to these two, there are many other agricultural machinery whose cumulative operating areas have reached more than 10 acres.

According to market prices, these agricultural machinery have already made a lot of money.

After getting a brief understanding of Donghe's situation, Guo Yang looked through Jiahe's projects in the past two years.

Excluding the desert and the Asafoetida Gobi, there are about 130 million mu of land involved in reclamation, and about 100 million mu involved in cultivation and harvesting.

According to the current machinery, it is indeed a stretch.

However, Jiahe has always maintained good cooperative relations with several major agricultural reclamation companies and some agricultural machinery cooperatives.

Relying on internal and external methods, we completed the development of the past two years.

Combined with the existing situation.

Guo Yang knew that Donghe Agricultural Machinery did need to update its equipment and that the agricultural machinery operator team also needed to remain active.

After waiting for a while, Cai Bin finished reading the information, with an extremely complicated expression on his face.

He didn't expect Zhang Wei to think so far ahead.

Seeing this, Guo Yang said, "It should be because of these ideas and the problems at home that Zhang Wei wanted to return to his hometown to start a business."

Before this, Guo Yang and Zhang Wei had discussed this in detail.

In the field of agricultural machinery services, Donghe has had a good few years relying on the big tree of Jiahe, and the next three to four years should be easy.

However, the previous asset-light operation capabilities such as custodial services, intermediary services, and agricultural machinery sales are no longer available, and the market competitiveness has declined significantly.

On the other hand, oil prices are rising, employee salaries are rising, management costs are rising, and so on.

All of these will cause Donghe Agricultural Machinery, which operates with heavy assets, to become more and more like an old man who walks with difficulty.

So, in Zhang Wei's vision.

Donghe also needs to undergo reforms like market-oriented professional cooperatives.

The operators should also have a cooperative relationship with Donghe.

Especially in terms of income distribution and financial management, the simple operating area can no longer be used as a performance evaluation criterion.

Instead, an account book should be established for each agricultural machinery operator, and single-machine settlement should be implemented for the income and expenditure such as operating area, operating oil, operating income, spare parts fees, and maintenance fees.

It clearly shows how much work the operator has done, how much oil has been added, how many accessories have been used, and how much money has been spent.

It will enable the deep binding between the operators and the machinery, mobilize the operators' enthusiasm, let the operators make more money, and also make profits.

These are what Cai Bin just saw.

Only then did he realize what the real problems facing Donghe Agricultural Machinery were. It was not only about completing the task, but also about saving costs and creating benefits for the company.

Why do many operators now prefer to go out and work alone?

Because there is more freedom and higher efficiency.

Take an imported combine harvester for example, the price is between 23 and 27 yuan, and the government subsidizes one third of it.

You have to pay 16 to 19 yuan yourself.

If cross-regional operations are implemented, about 800 acres can be worked in a season, with a gross profit of more than 5 yuan and a net profit of 3 yuan.

If we can earn another 3 to 4 yuan from local harvesting, we can recover all the investment in less than 3 years.

By this calculation, purchasing agricultural machinery is much more cost-effective than setting up a small business.

Guo Yang saw that Cai Bin had been staring at the plan left by Zhang Wei. He knocked on the table to let Cai Bin come back to his senses, and then he said:
"I will promote the renewal of agricultural machinery. The number of agricultural machinery operators will remain fixed at around 200, and we will recruit more when there are vacancies."

"You should first come up with a specific plan based on Zhang Wei's plan. In addition, details such as agricultural machinery gas stations, parts supply outlets, and repair outlets can also be optimized." "Okay." Cai Bin nodded.

Guo Yang had more exposure to agricultural machinery services in his previous life, so he has a deeper understanding of it.

It is precisely because of this that we can appreciate how valuable Zhang Wei is.

In just a few years, we have gained so much experience.

He had a hunch that Zhang Wei's business would be successful and that Jiahe would definitely be one of its target customers.

Wait until Cai Bin leaves.

Guo Yang continued to study the financial report.

In the first three quarters, Golden Harvest's operating income reached 241 billion yuan.

Alfalfa Agriculture and Animal Husbandry 95 billion yuan,

Tianhe Seed Industry 60 billion yuan,

Hexi Dairy 59 billion yuan,

Fengkai Agricultural Machinery 24 billion yuan,

Quanwang Biotechnology 2.4 million yuan,

Shahai Agriculture and Animal Husbandry earned 0.6 million yuan from selling Cistanche deserticola and renting out solar greenhouses.

Based on this data, it can basically surpass New Hope Liuhe and take the title of the country's number one agricultural and animal husbandry group.

But Guo Yang would rather keep a low profile.

Relying on the two big brothers, Muhe and Tianhe, the overall profit is nearly 160 billion yuan.

However, investment is not taken into account here.

A lot of funds are also expected to be used for reinvestment in the next two years.

Jiahe Grain and Oil’s 60 billion yuan + expected losses;
Asafoetida Gobi 18 billion;

Quanwang Bio's bio-source pesticide factory and the expansion of its extract factory have also been basically completed, with a total investment of about 10 billion yuan;

Tianhe's seed production base expanded from 10 mu to 50 mu, and there is also a 10 mu seed production base in Hainan, as well as Huinong.com, with a total of 20 billion yuan;

Improvement of 100 million mu of saline-alkali land in Muhe Agricultural and Pastoral Xinjiang Province and Jinta, as well as development of the Gobi Desert, totaling RMB 20 billion;

The 100 million mu of desert control for Shahai Agriculture and Animal Husbandry, as well as the maintenance of 14 mu of existing Haloxylon ammodendron forests, cannot be achieved without 20 billion yuan;

The control of grassland degradation caused by falcon agriculture can be ignored for the time being.

All in all, more than 148 billion yuan will need to be invested in two years.

But Jiahe's expected profit next year will only be higher. Guo Yang circled the data on the paper. With the current financial situation, there is still a lot of room for improvement.

160+160-148=172.

Some of them can start to receive payments in advance two or three months, such as the seed sales of Alfalfa and Tianhe.

Combined with the investigations he had conducted outside during this period, Guo Yang gradually formed some ideas in his mind.

The sunlight shines through the office window, casting a warm and soft glow, and the Qilian Snow Mountain outside the window also comes alive under the sunlight.

There were also busy sounds coming from the office area.

Guo Yang also found some people one after another to understand the situation of some key tasks.

After being busy for several hours, just when Guo Yang was about to take a break, Qu Yang hurried in.

"Boss, someone in the market is starting to hype up Tianyu No. 1 again! They're still trying to link it to genetically modified organisms."

Guo Yang raised his eyebrows and asked, "Who is so blind as to dare to jump on this?"

"I checked and it's an advertising company, but it should have received money from some companies!"

Guo Yang walked to the coffee table and sat down, and Qu Yang took the initiative to make tea.

"This year's corn harvest is great, and the quality of Tianyu No. 1 seeds is also very good. The yield will surely exceed 10 billion catties, and is expected to exceed 12 billion catties!"

"Someone is panicking!"

Guo Yang smiled and said, "How can I not panic? Robbing someone's money is like killing their parents, but this method is a bit too low-end."

Qu Yang said: "The advertising company is a minor matter. The relevant departments have already investigated it. I am afraid that other seed companies have joined forces."

"In the past six months, we are not the only one busy with mergers and acquisitions. Companies such as Shazhou, Denghai, Da Beinong, and Fengle have also been busy, and have introduced international capital one after another."

“Even Longping High-Tech, which had its eyes on the corn seed market, reached an agreement with Limagrain and sold part of its shares.”

While enjoying the aroma of the red hemp tea, Guo Yang said, "Do you think it's useful?"

In the current domestic corn seed market, Tianhe’s advantages are already extremely obvious.

Especially after strengthening the crackdown on seed industry counterfeiting, all obstacles in the way have been cleared.

Qu Yang said: "It's just a little disgusting!"

Guo Yang smiled and said, "Think of it this way. If the Tianyu No. 1 seeds can be sold out this year, % to % of the domestic corn market will belong to us. They are already very restrained now."

Qu Yang was stunned. If you think in this way, dozens or even hundreds of seed companies are competing for that 20% to 30% of the market.

That is really heartbreaking!
However, the Ministry of Agriculture and the Ministry of Public Security are keeping a close eye on the situation, so there is no good way to do anything tricky. The only option is to introduce more international capital.

Qu Yang added: "In one or two years, the imitation of Tianyu No. 1 should be available on the market."

"It's okay. We can make enough money in the next two years. We will make less money later. Besides, Tianyu No. 8 will start to be promoted next year."

After a pause, Guo Yang said, "On the contrary, the Denong Agricultural Materials Supermarket can allow Yuan Wenwu to take advantage of the village-to-village road project and speed up the pace of expansion."

"Let's work out the funding plan first, because we may not have any money next year."

Qu Yang was surprised for a moment.

No money?

How can this be?

Unless there is some big move again!
Qu Yang quickly sorted out the places where Tianhe needed to spend money, including Denong Agricultural Materials Supermarket and Huinong.com.

We have to apply for the funds quickly.

In addition to Tianhe Seed Industry, Guo Yang also had exchanges with Xie Shijie, Lu Hanbin, Xiang Tianshan, Yu Qin, and Bao Xinyu.

In short, please report your funding plan first.

a few days later.

Guo Yang convened a meeting of all the companies in the group. This was the first meeting in the past one or two months.

Fortunately, each department is very proficient in their business, and the data, business conditions, and problems encountered are consistent with what Guo Yang knows.

Guo Yang also took this opportunity to finalize the funding plans for each subsidiary for this year and next year.

Leave room for each subsidiary.

As for the remaining large amount of funds, Guo Yang did not make it public.

Instead, they are preparing to gradually enter the grain and futures markets and start making plans.

...

In a high-end hotel in Zhangye, several well-known domestic corn seed company executives gathered together.

Smoke billows.

The atmosphere was a little dull.

a long time.

Xie Fanglin of Shazhou Seeds, the host, said, "Now we should unite and fight against Tianhe Seeds."

"Everyone has visited Tianhe's seed production base. The weather has been good this year, and there has not been a reduction in production at any one site."

"How do we unite?"

"United ass!"

On the other side, a slightly younger man also stood up and said, "It all depends on your ability!"

Xie Fanglin said: "Haha, Longping High-Tech thought that it could really gain a foothold in the corn seed industry just because it had Limagrain."

"Liu Shi, I think you are too superstitious about foreign investment!"

"Liu Shi has worked in foreign-funded enterprises for more than ten years, from Monsanto to Bayer, then to Limagrain, and now to Longping. He is a pioneer in foreign-funded enterprises!"

Upon hearing this, Liu Shi, who had just taken office as the chief CEO of Longping High-Tech, felt furious.

"It's better than you not making any progress!"

"Aren't Shazhou and Denghai Seed Industries doing well thanks to the Pioneer 335?"

Zhang Lei of Denong Seeds said sarcastically: "Xianyu 335 has deliberately allowed counterfeiting, so how can we unite?"

"I just find it funny. Shazhou Pioneer and Denghai Pioneer were crazy about cross-selling last year, and the summer sowing market has been messed up by you."

Li Denghai remained silent.

A party started because of Tianhe ended up in a bad mood.

Everyone has ulterior motives.

Afterwards, Xie Fanglin flew to Shazhou Seed Industry’s breeding base in Hainan.

In the fields, the seeds of Shazhou Seed Industry's imitation of Tianyu No. 1 have taken root and sprouted.

At the same time, another type of seed is about to enter the final year of the regional trial phase for variety approval.

Once the approval is completed, the imitation seeds will be coated to become the seeds that have completed the approval, which means that the imitation seeds in 08 can be put on the market for sale.

This is already the fastest way and also an innovation.

Many domestic enterprises and scientific research institutions do this, including Denghai, Denong, Da Beinong, and Fengle, without exception.

But this is the last chance.

The top leaders are more determined than ever to push for the reform of the variety approval system and the revision of the Seed FA.

Xie Fanglin just wanted to get the imitation seeds on the market as soon as possible, make a little extra money, drive up the stock price of Shazhou Seed Industry, and then reap the rewards.

(End of this chapter)