enjoyebooks Chapter 250 Refined Expansion
Chapter 250 Refined Expansion
Zhao Weiguo took a breath: "Five hundred? Brother Yun, three hundred this year has already given us a huge headache, five hundred..."
"So we need to change our strategy," Ling Yun said. "The root of the problem you just mentioned is that our expansion model is too extensive. We need to refine it."
He stood up and walked to the map.
"The first step is city tiering." He circled cities on the map with his finger. "Tier 1: Beijing, Shanghai, Guangzhou, and Shenzhen. Tier 2: Provincial capitals and economically strong cities. Tier 3: Prefecture-level cities and developed county-level cities. Tier 4: Others."
"In first-tier cities, we'll focus on direct operation, but it's not just about opening stores; we'll open flagship stores and experience stores. They need to be large, equipped with top-of-the-line equipment, and have the best environment. They'll be more than just internet cafes; they'll become showcase centers for the Starry Sky system, gathering places for gamers, and venues for esports events. We'll choose locations in prime commercial areas, even if the rent is high."
"In second-tier cities, we will combine direct operation and franchising. Each city will have at least one directly operated flagship store as a benchmark and training base. Other cities can be opened to franchising, but the franchising standards will be raised and the review process will be more stringent."
"In third-tier cities, we primarily focus on franchising, supplemented by outsourced operations. We provide a complete solution, from site selection to opening to operation. Franchisees provide the capital, while we provide management and branding."
"We will not actively enter fourth-tier cities for the time being. If someone wants to join us, the conditions can be relaxed, but the brand authorization fee will be increased to hedge against risks."
Zhao Weiguo quickly took notes.
"The second step is asset strategy," Ling Yun continued. "For shops in first- and second-tier cities, if you can buy real estate, do so. Currently, funds are plentiful, loan interest rates are low, and housing prices are still low. Buying real estate will lock in costs on the one hand, and increase asset value on the other. Especially street-front shops in core business districts, which will only appreciate in the long run."
Chen Lingling's eyes lit up: "When I was in Silicon Valley, the Spark Internet Cafe in Palo Alto was rented, but the landlord raised the rent by 20% the following year. If we could buy it..."
"Yes." Ling Yun nodded. "Even if we can't buy it, we should sign a long-term lease to lock in rent increases. Zhao Weiguo, you should take the lead in setting up an asset management department to specifically handle store location selection and property rights negotiations."
"Understood," Zhao Weiguo wrote down.
"The third step is to open up the supply chain." Ling Yun returned to his seat. "Previously, we were worried that franchisees would use generic equipment, which would affect the customer experience, so we mandated that they purchase all their equipment from us. But this limited our expansion speed and increased management costs."
He looked at Chen Lingling: "You are responsible for developing a set of equipment procurement standards and certification systems. For each category, including computer mainframes, monitors, keyboards and mice, desks and chairs, network equipment, etc., list two to three supplier models that we have certified. Franchisees must choose from the certified list, but they can purchase directly from the suppliers. We only charge a small certification management fee. This will ensure quality while reducing our inventory and logistics pressure."
"What about the software?" Chen Lingling asked.
"You must use our software," Ling Yun said firmly. "The internet cafe management system, the Starry Sky System (internet cafe version), Star Language, the game platform... these are the core components and cannot be given away. However, we can flexibly license them, for example, by charging based on the number of computers, or by including them in the franchise fee."
"What about drinks and snacks?" Zhao Weiguo asked.
"Openness," Ling Yun said. "We can provide a unified supply chain channel and recommend several beverage, snack, and fast food suppliers for cooperation, but franchisees can choose for themselves. We only make recommendations, not mandate anything. However, the brand image must be consistent; for example, the Spark logo must be on the cups and packaging bags."
Zhao Weiguo nodded: "This will greatly increase the enthusiasm of franchisees and reduce our management pressure."
"The fourth step is the talent development system," Ling Yun said. "We'll open a 'Spark Internet Cafe Academy.' We'll compile the teaching materials and send the instructors. We'll train store managers, internet cafe administrators, cashiers, and event planners. The training is free, but after graduation, you have to sign a service agreement and work within the Spark system for at least two years. The training costs will be covered by the franchise fee and management fee."
"That's great!" Zhao Weiguo slapped his thigh. "With our own talent pool, we won't have to worry about a lack of people when we expand."
"Fifth step, differentiated competition." Ling Yun looked at Chen Lingling, "You just said the added value wasn't enough. We need to increase our service content. For example:"
He held up his finger:
1. Esports event organization. We'll hold StarCraft and Quake tournaments in various cities every quarter, with the winners advancing to the national finals. We'll cover the prize money. We'll turn internet cafes into esports hubs.
2. Game coaching service. Recruit high-level players to work as part-time coaches, providing paid guidance to beginners, with revenue sharing.
3. Hardware Upgrade Zone. Showcases Alienware computers, the latest graphics cards, and top-of-the-line PCs, allowing players to experience them firsthand.
4. Community activities. Organize player movie screenings, technical lectures, and game-themed parties.
"5. Deeply integrated with the Starry Sky Games platform. Internet cafe accounts and platform accounts are linked, providing experience bonuses and exclusive tasks when playing games at internet cafes."
Chen Lingling quickly took notes, her eyes shining: "This way, the internet cafe won't just be a place to surf the internet, but a social and entertainment center for gamers."
"That's right," Ling Yun said. "What we're going to do isn't an internet cafe, but a 'third space'—a place outside of home and office where young people are willing to stay and spend money."
The office fell silent, with only Zhao Weiguo's pen scratching on the paper.
Ling Yun took a sip of water and looked out the window. The streetlights came on downstairs, and students walked by in twos and threes; some went into the internet cafe.
"Zhao Weiguo, are you confident about the goal of 500 companies?" he asked.
Zhao Weiguo put down his pen and straightened his back: "With President Ling's strategy, yes."
Where is Chen Lingling?
"Yes," Chen Lingling said in a clear voice, "I studied chain store management in the United States, which will come in handy."
"Okay." Ling Yun stood up. "In 1998, the internet cafe business will be established as a separate company with independent accounting. Zhao Weiguo will serve as general manager, and Chen Lingling as operations director. The headquarters will be moved to the Software Park, and the team will be expanded to fifty people. The budget... will be initially approved at 20 million yuan for asset acquisition and talent development."
"Understood!" The two stood up at the same time.
"Give me a detailed implementation plan within two weeks," Ling Yun said. "It should be detailed down to how many stores to open in each city, which properties to buy, how to build the supply chain, and how to establish a training system. I need to see a plan that can be implemented."
"OK!"
"Furthermore," Ling Yun said, walking to the door and then turning back, "we'll hold a national internet cafe manager conference at the end of this year. We'll invite all 500 managers (if we succeed) to Jinan, providing them with food, lodging, bonuses, and recognizing outstanding performers. We want everyone to feel that working at Xinghuo offers a promising future."
"OK!"
"Brother Peng, are you in Jinan lately?" Ling Yun asked.
"Yes, he came to the internet cafe to play games for a while yesterday. I treated him to tea all afternoon, and he listened to me complain all afternoon!" Zhao Weiguo said helplessly.
"Call him and Mo Ge and invite them to dinner tonight for roasted pig's trotters! I'm going to Zhuangyuan Roasted Pig's Trotters to reserve a table now." Ling Yun said and left the office.
Ling Yun went downstairs, and Zhao Hu followed.
Stepping out of the internet cafe, a cold wind blew, and Ling Yun tightened his collar.
Across the street, a newly opened small supermarket was unloading goods; its sign read "Hualian Supermarket." He remembered the shopping vouchers they'd discussed at the electronics factory that afternoon; perhaps he could talk to this supermarket about a partnership.
"Mr. Ling, going home?" Zhao Hu asked.
"Take them out for barbecue. First, book a private room at Zhuangyuan Roasted Trotters. I'll call Shiyu, and you can go pick her up," Lingyun continued. "Go to the Software Park tomorrow morning to choose an office location for the internet cafe company. Remember to remind me tomorrow."
"OK!"