sbdcsierra Chapter 168 Year-end settlement, initial profit
Chapter 168 Year-end settlement, initial profit
Three days after the truck carrying the export order left the factory, a telegram from Boss Chen in Hong Kong arrived in Lin Chen's hands. The telegram was brief and powerful: "Goods have been signed for, quality far exceeds standards, next order is for 10,000 sets, deposit of 20,000 has been transferred." Holding this thin telegram, Lin Chen stood in his office for a long time. Outside the window, the Zhangjiang River was shrouded in the thin mist of early winter, and the busy figures of the workers in the factory were faintly visible in the mist. This was the most weighty affirmation that Chenqing Hardware Factory had received since its establishment.
"Director Lin, the bank called to say a transfer of 20,000 yuan has arrived, with the note saying it's a deposit." Su Qing walked briskly into the office, her navy blue work jacket still dusted with chalk—she had just been calculating the day's performance data on the workshop blackboard. Seeing the telegram in Lin Chen's hand, her eyes lit up instantly. "Boss Chen is so efficient! Now we not only pay off the alloy material debt we owe the scrap yard, but we also have the resources to upgrade our equipment."
Lin Chen handed the telegram to Su Qing, his fingertips still feeling its burning weight as they traced the paper: "An order for 10,000 sets, at our current production capacity, will take at least three months to complete. The most urgent task is to take advantage of the year-end period to implement equipment upgrades and personnel expansion. By the way, how's the year-end settlement going? We need to give the workers a satisfactory explanation."
When the topic turned to accounting, Su Qing pulled a thick ledger from her canvas bag. The cover, marked in red pen, read "Chenqing Hardware Factory 1981 Income and Expenditure Details," and the edges of the pages were worn and frayed. "I've been checking the accounts for the past two weeks, from the initial 800 yuan start-up capital to the current order revenue—I've recorded every single item," she said, opening the ledger and pointing to a page. "After deducting raw material costs, worker wages, and transportation expenses, the foreign trade orders netted 32,000 yuan; the domestic commune orders were more scattered, adding up to 8,000 yuan in profit; plus the 20,000 yuan deposit prepaid by Boss Chen, we now have a total of 61,000 yuan in working capital in our account."
This figure surprised Lin Chen. He had originally estimated that the first batch of foreign trade orders would earn him a profit of 20,000 yuan, but he hadn't expected that the improved steel utilization rate through alloy fusion technology, coupled with Su Qing's precise control over raw material losses, would result in actual profits exceeding expectations by 60%. More importantly, the new order for 10,000 sets meant that Chenqing Hardware Factory had already established a foothold in the Southeast Asian market, which was more valuable than mere profit.
"Let's go to the workshop and tell the workers." Lin Chen closed the ledger, got up, and headed towards the workshop. Inside the forging workshop, Uncle Wang was leading several technicians in adjusting an air hammer they had just bought from the secondhand market. This equipment, acquired by Lin Chen using the advance payment from an export order, was three times more efficient than the previous manual hammer. Seeing Lin Chen and Su Qing enter, the workers stopped what they were doing, their eyes filled with anticipation—everyone had been speculating about the order's profitability, as it affected everyone's year-end bonus.
"I have great news to share! Our first batch of export orders has been successfully completed. Boss Chen is extremely satisfied. He not only paid for the goods in full but also placed a new order for 10,000 sets!" Lin Chen's voice clearly pierced through the roar of the workshop, and the workers immediately erupted in cheers. Xiao Li excitedly waved his wrench, exclaiming, "That's fantastic! I knew following Factory Manager Lin was the right choice!"
After the cheers subsided, Su Qing stepped forward and opened the ledger in her hand: "There's more good news to announce. After calculation, our factory's net profit this year is 40,000 yuan! According to the performance system we established before, in addition to the basic salary, everyone will receive a generous year-end bonus." She read out the specific amounts, "Uncle Wang, as a key technical staff member, will receive 800 yuan in year-end bonus; Xiao Li has the highest output, 750 yuan; Old Chen is in charge of quality inspection, 600 yuan..."
When each person's bonus amount was read out, a chorus of envious gasps would erupt in the workshop. Keep in mind that in Zhangcheng in 1978, the monthly salary for a regular worker in a state-owned factory was only thirty or forty yuan. The workers at Chenqing Hardware Factory not only earned over fifty yuan a month, but their year-end bonus was equivalent to a year's wages for an average worker. Old Chen, upon hearing his bonus amount, was so excited his hands trembled. He wiped his eyes and said, "I've worked in a state-owned factory for twenty years and have never received such a large bonus! Director Lin, Accountant Su, you are truly our benefactors!"
"Everyone earned their bonuses through their own skills and hard work," Lin Chen said sincerely, waving his hand. "However, we can't just focus on immediate profits. We have three plans for this profit: First, we'll use 2,000 yuan to upgrade our equipment. In addition to the air hammer we've already bought, we'll add two more lathes to improve production precision. Second, we'll use 1,000 yuan as year-end bonuses so everyone can have a good New Year. Finally, we'll use the remaining money to stockpile raw materials to meet next year's production needs, and the other part as reserve funds for the factory."
After listening to Lin Chen's plan, the workers all expressed their agreement. Uncle Wang even patted his chest and guaranteed, "Don't worry, Director Lin, once the new equipment is bought, I guarantee I can teach everyone how to operate it within three days. Our output next year will definitely double!" Lin Chen smiled and nodded. He knew that these workers were his old colleagues who had followed him from the farm implement factory and had a deep affection for the factory. This was Chenqing Hardware Factory's most valuable asset.
That afternoon, Lin Chen took Uncle Wang and Xiao Li to the electromechanical market in Zhangcheng. This market held all sorts of new and used machinery, including old equipment discarded by state-owned factories and secondhand machine tools transported from the south. Lin Chen's goal was clear: to select two high-precision lathes with low failure rates for machining the core components of plowshare parts.
"Director Lin, what do you think of this C6140 lathe produced by the Shanghai Machine Tool Factory?" Uncle Wang said, pointing to a slightly worn lathe. "I used this model when I was in a state-owned factory. Its precision can reach 0.01 millimeters, which is enough for us to process parts for export orders." Lin Chen stepped forward and used the system to inspect the lathe. He found that the spindle of this lathe had little wear, and the key components were still intact. It was just that the appearance was a bit old.
The equipment seller, a middle-aged man with a mustache, saw that Lin Chen and his group seemed genuinely interested in buying it, and quickly approached, saying, "Sir, you have a good eye! I bought this lathe from a state-owned factory in Shanghai. Although it's been used for a few years, it's in excellent condition, and I can sell it for only 3,500 yuan. If you were to buy a new one from a state-owned machine tool factory, it would cost at least 5,000 yuan!"
"Three thousand yuan, we'll take it away today." Lin Chen didn't hesitate and quoted the price directly. He knew the profit margin for this kind of used equipment was huge, and the factory urgently needed lathes to improve production efficiency, so there was no need to haggle over the price. The mustachioed boss hesitated for a moment, then saw Uncle Wang behind Lin Chen inspecting the equipment with a wrench. Knowing he had found someone knowledgeable, he nodded in agreement: "Okay! Three thousand yuan it is, I'll also throw in a set of spare cutting tools!"
After buying the lathe, Lin Chen spent another 500 yuan on a small drilling machine to drill holes for the plowshare parts. On the way back, Xiao Li drove the tractor carrying the equipment, while Uncle Wang sat in the passenger seat, excitedly chatting with Lin Chen about next year's production plan: "Director Lin, with these new machines, we can optimize the production process again. Processes that used to require three people can now be done by one person, which will definitely increase output significantly."
Lin Chen nodded. He already had a preliminary production plan in mind: the workshop would be divided into three areas: forging, processing, and assembly. The forging area would use air hammers and furnaces to process steel, the processing area would use lathes and drilling machines for precision machining, and the assembly area would be responsible for assembling the various parts into finished products. This would not only improve production efficiency but also ensure the stability of product quality.
Back at the factory, the workers all volunteered to help unload the equipment. Working together, they quickly moved the lathe and drilling machine into the workshop. Uncle Wang immediately led several technicians to start testing the equipment. He first added lubricating oil to the lathe, then connected the power. After starting the lathe, the spindle rotated smoothly without any wobble. "Great! This lathe's precision is almost like a new one!" Uncle Wang exclaimed excitedly. He picked up a piece of steel and tried cutting it; the resulting iron filings were even and fine, indicating that the lathe's precision was indeed very high.
After the equipment was debugged, Lin Chen convened a workshop meeting and announced the new production process plan. He divided the workers into three groups, each responsible for a production area. Uncle Wang served as the chief technical advisor, responsible for resolving technical problems encountered during production; Xiao Li served as the production team leader, responsible for coordinating the production progress of each group. This division of labor not only clarified everyone's responsibilities but also made full use of everyone's strengths.
Just as the factory was busily preparing to expand production, Su Qing suddenly discovered a problem. She took the ledger to Lin Chen, her expression grave: "Factory Manager Lin, our raw material inventory may not be enough to support next year's production. Now that the year is almost over, several steel suppliers in Zhangcheng are stockpiling goods, prices have already increased by 10%, and you need a letter of introduction to purchase them."
Lin Chen frowned after hearing Su Qing's words. Raw materials were the lifeline of the factory, especially with rising steel prices directly increasing production costs. He remembered Old Wang, whom he had met at the scrap yard; Old Wang had a lot of scrap steel and alloy scraps, and perhaps they could purchase a batch of raw materials from him for emergency use. "I'll go to the scrap yard on the outskirts of the city tomorrow; Old Wang might have the raw materials we need," Lin Chen said. "And you should also contact Fatty Liu at the Zhangcheng Supply Station and see if you can get some affordable steel from him, even if it's just a small amount."
The next morning, Lin Chen rode his bicycle to the scrap yard on the outskirts of the city. Old Wang, seeing Lin Chen arrive, hurriedly greeted him warmly: "Director Lin, what a rare guest! How were the alloy scraps you bought from here last time?" "They were excellent. This time I'm here to establish a long-term partnership with you," Lin Chen said with a smile. "I need a large quantity of scrap steel and alloy scraps. As long as the quality is up to standard, the price is negotiable."
Old Wang showed Lin Chen around the scrap yard's warehouse, where mountains of scrap steel caught Lin Chen's eye. "These are all scrap steel I collected from various state-owned factories. Although they look old, the impurity content is low, and they can be used perfectly after remelting," Old Wang explained. "It's the end of the year now, and many factories are clearing out their inventory. I have plenty here; I can supply you as much as you need."
Lin Chen used the system to check the quality of the scrap steel and found that, as Lao Wang had said, the impurity content was low, making it suitable for remelting into high-quality steel through alloy fusion technology. He immediately decided to purchase fifty tons of scrap steel and ten tons of alloy scrap. The price Lao Wang offered was also very reasonable, 30% cheaper than new steel on the market. "Lao Wang, I hope we can establish a long-term cooperative relationship. I will purchase raw materials from you every month from now on. You need to guarantee the quality and stability of the supply of raw materials," Lin Chen said.
Old Wang nodded in agreement: "Don't worry, Director Lin, I'm a man of integrity in business! I'll prioritize meeting your raw material needs from now on, and I'll give you an extra 5% discount!" After the two signed the cooperation agreement, Lin Chen called the factory to send a tractor to pick up the goods. Watching truckloads of raw materials being brought back to the factory, he finally felt relieved.
Meanwhile, Su Qing also received good news from the Zhangcheng Supply Station. Although Fatty Liu had sold them substandard steel before, seeing the increasingly prosperous development of Chenqing Hardware Factory, he wanted to resume cooperation. He agreed to sell Lin Chen twenty tons of high-quality steel at a fair price. Although the quantity was not large, it was enough to support the factory's initial production needs. "Factory Director Lin, Fatty Liu also said that if we have any technical needs in the future, he can help contact the technical personnel of the state-owned factory," Su Qing said.
"It seems Fatty Liu wants to reconcile with us," Lin Chen said with a smile. "We need to be more careful when dealing with him in the future. We must strictly control the quality of raw materials and prevent a repeat of the substandard steel incident from happening again." Su Qing nodded. She had already developed a comprehensive raw material testing process. All raw materials must undergo magnetic adsorption and spectrometer testing before entering the factory to ensure that they meet quality standards.
After resolving the issues of raw materials and equipment, Lin Chen began recruiting new workers. With the expansion of production, the factory urgently needed fresh blood, especially young workers with technical skills. He posted a recruitment notice at the factory gate, stating a monthly salary of fifty yuan, including meals and accommodation, and a year-end bonus. Unexpectedly, more than thirty applicants came in just one day.
At the recruitment site, Lin Chen and Uncle Wang were in charge of the interviews. They mainly assessed the applicants' technical skills and their willingness to work hard, giving priority to workers with experience in state-owned factories. One young man named Zhang Qiang caught Lin Chen's attention. He had previously worked as an apprentice in a state-owned machine tool factory in Shanghai, but returned to Zhangcheng due to family matters. He had very solid technical skills and a strong ability to learn new equipment.
"Zhang Qiang, would you like to work at our factory? Although we are a private factory, the pay is no worse than that of a state-owned factory, and there is a lot of room for career advancement," Lin Chen asked. Zhang Qiang nodded quickly, "Director Lin, I've heard about Chenqing Hardware Factory's reputation for a long time. It would be an honor to work here! I will definitely work hard and live up to your trust!" Lin Chen immediately decided to hire Zhang Qiang and appointed him as the deputy team leader of the processing area to assist Uncle Wang in managing production technology.
After two days of recruitment, Lin Chen hired fifteen new workers, five of whom were experienced technical staff from state-owned factories, and the rest were young and strong. To help the new workers quickly familiarize themselves with the production process, Lin Chen arranged for Uncle Wang and Zhang Qiang to be in charge of training, with experienced workers mentoring new workers and providing one-on-one guidance. In less than a week, the new workers were able to complete production tasks independently, and the factory's production capacity doubled.
As Lunar New Year's Eve approached, Lin Chen decided to give the workers a ten-day holiday so they could go home and celebrate the New Year. The day before the holiday, the factory held a lively New Year's Eve dinner. The canteen was filled with tables laden with a sumptuous feast of chicken, fish, pork, and other dishes, all specially purchased by Lin Chen from the supply and marketing cooperative. The workers sat together, raising their glasses in celebration and discussing their plans for the coming year.
"Director Lin, our orders are sure to increase next year. Could we build a new workshop?" Xiao Li asked, taking a sip of his drink. Lin Chen nodded. "I've already negotiated with the village committee on the outskirts of the city. We'll rent ten acres of land next spring to build a new workshop. That way, our production scale can double." Uncle Wang added, "Once the new workshop is built, we can introduce more advanced equipment to produce higher-precision products. We'll not only target the Southeast Asian market, but also sell our products to Europe!"
Watching the lively scene, Su Qing, carrying a cup of tea, walked to Lin Chen's side and said softly, "Factory Manager Lin, from the two of us starting the factory to now having over thirty employees and a steady stream of orders, all of this is inseparable from your vision and hard work." Lin Chen looked at Su Qing, his eyes filled with gratitude: "This also wouldn't have been possible without your help. Without your precise financial accounting and management, the factory wouldn't be where it is today. Su Qing, thank you."
The New Year's Eve dinner ended amidst laughter and joy. The workers, receiving generous year-end bonuses, beamed with happiness. Lin Chen stood at the factory gate, watching the workers leave one by one, his heart filled with emotion. He recalled the difficult days in the Hongxing Courtyard at the beginning of his rebirth, the hardships he faced when he first arrived in Zhangcheng, and looking at the thriving factory now, he couldn't help but feel a surge of emotions.
During the Spring Festival, Lin Chen didn't rest. He used the holiday to improve the factory's management system, formulate detailed production processes and quality standards, and plan the construction of the new workshop. Su Qing also took the initiative to come to the factory to help Lin Chen organize financial data and prepare for next year's production. The two cooperated tacitly, as if they had formed a consensus without words.
On the eighth day of the first lunar month, the factory officially resumed operations. Workers returned to the workshop with the joy of the New Year. The new equipment had been debugged, and the new workers were already familiar with the production process. The entire factory presented a thriving scene. Lin Chen stood in the workshop, looking at the roaring machines and busy workers, his heart filled with confidence. He knew that the story of Chenqing Hardware Factory had only just begun, and in the spring breeze of reform and opening up, this small factory would surely create even greater glory.
On the first day of work, Boss Chen sent a telegram from Hong Kong informing them of the specific specifications and delivery time for the next order of 10,000 sets. Lin Chen, holding the telegram, convened a meeting of the workshop's key personnel and announced the new production target: "Complete the production of 10,000 sets within three months, while simultaneously expanding into the domestic agricultural machinery market, making the 'Chenqing Precision Machinery' brand renowned throughout the country!"
After the meeting, the workers returned to their posts, and the familiar roar of machinery filled the workshop once more. Lin Chen and Su Qing stood at the workshop entrance, looking at everything before them, and smiled at each other. They knew that the road ahead might be full of challenges, but as long as they joined hands and led the workers of Chenqing Hardware Factory to work diligently, they would surely realize their dreams and sail far in the tides of the business world.