Capítulo 211: Chapter 211: The Happiness of Capital You Can't Imagine
The sixth pillar industry Hardy planned to develop was the luxury industry.
"The manufacturing industry profits on scale, while luxury goods profit on brand value. With the media industry as our support for high visibility, we can build several luxury brands," Hardy explained.
"Manufacturing profits are often around 10%, while luxury goods can yield profits multiple times that. For example, a bag costing $10 to make can be sold for $2,000, thanks to the brand's added value."
"We can either invest in existing luxury brands or create new ones. With effective promotion, any product can be marketed as a luxury item."
Finally, Hardy addressed a crucial addition to the group.
"In addition to our current departments, we need to establish a Group Think Tank."
"The management team is the torso, and the think tank is the brain. It will provide policy research, forward-looking consultation, and business intelligence to guide company decisions."
Andy agreed with Hardy's vision, and two days later, the Hardy Group held its first comprehensive meeting to announce its three-year plan. Some details were kept confidential to avoid leaks and potential competitive disadvantages.
Each company and department within the group was tasked with developing their own three-year plans, which would be reviewed by Hardy.
For Walsh Mining, Hardy instructed Columbus, the prospecting director, to expand the exploration team and find new mineral sources.
"Good boss," Columbus acknowledged.
Hardy handed him a map of Australia. "Experts say Western Australia is rich in minerals, yet it remains largely unexplored. Our goal is to identify new mining opportunities there."
Australia's mineral reserves, particularly in Western Australia, are among the highest globally. With the current date being 1948, many significant mines are yet to be discovered. Hardy saw this as an opportune moment to enter the Australian mining industry.
After addressing the group's needs, Hardy took some time to relax. With various presidents and managers handling specific affairs, he could afford to step back.
A few days later, Andy brought news from PepsiCo. The company had recently announced its financial results for the previous year, showing a further decline in business and profitability for 1947. This led to a drop in PepsiCo's stock price.
Adding to the bad news, Pepsi-Cola's syrup production plant in San Francisco had suffered a pipeline collapse, resulting in a loss of nearly 50,000 liters of syrup and a production halt. This incident caused Pepsi's stock price to drop even further.
The market's lack of confidence was exacerbated by a Global Times report suggesting that Pepsi might soon face bankruptcy, as Coca-Cola, its rival, had refused to acquire Pepsi for the third time.
In response, Hardy and his team began acquiring Pepsi shares. The company's stock price had plummeted from $8.30 to $5.60 per share, resulting in a market value drop of over $5 million. Many small shareholders, disillusioned with Pepsi's future, began selling their shares.
A financial company took advantage of this panic, buying up shares from small investors and acquiring 18% of Pepsi's total share capital. Andy, meanwhile, acquired more than 8% of the shares, bringing Hardy's total to 49%, making him the largest shareholder.
Walter Mack, now the second-largest shareholder with 27%, approached Hardy with a box of Pepsi. "Mr. Hardy, the new pull-tabs and sweepstakes have been set up and registered," he said, pointing to the new Pepsi packaging.
Hardy opened several bottles, enjoying the satisfying sound of the pull-tab and the accompanying messages under the caps, including one that read, "One more bottle." He also won a $0.50 cash prize.
"The cost of the new bottle caps?" Hardy asked.
"Each cap costs about 0.3 cents, double the previous iron caps," Walter responded.
"And the awards?" Hardy inquired.
"The prize distribution is as follows: 50% for 'thank you for your patronage,' 45% for 'another bottle,' and 5% cash rewards. We'll give out $100 prizes with a frequency of about 100,000 bottles to stimulate consumer interest."
The advertising campaign also focused on young people, highlighting the fun and ease of the new pull-tab feature. Hardy instructed that the new Pepsi ad be produced by HD Pictures and broadcast on ABC TV, emphasizing the enjoyment and excitement of winning prizes.
Within a few days, the new Pepsi commercial aired on ABC TV, showcasing young people enjoying Pepsi and winning prizes. The campaign proved successful, leading to an 800% increase in Pepsi's sales compared to the same period last year. Pepsi's stock price more than doubled, and Hardy's investment soared to a value of $130 million, generating a $6 million profit in just over a month.
This exemplified the profound impact and satisfaction that capital could bring, highlighting the immense potential for profit and influence in the world of business.
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