Seeing Wang Yi walk away so freely, Ohashi Taichi's expression changed dramatically, and he quickly chased after him:
"Chairman Wang, please don't rush, forty US dollars is indeed the current lowest price. Any lower than that is not up to me; I'll have to discuss it with the board of directors. Please give me some time!"
Wang Yi smiled:
"Alright, I'll give you 24 hours. Within 24 hours, I won't finalize any single supplier. But after 24 hours, it'll be hard to say who will get the big order for 5 million display assemblies."
"Personally, I'd like to cooperate with Toshiba, but whether we can or not depends on your sincerity!"
With that, Wang Yi walked out, full of confidence.
Toshiba doesn't have Samsung's capital, so they will definitely cut prices significantly!
Why is Samsung so arrogant?
First, Samsung A-screens are the best, leading the way.
High-end flagship phones that don't use Samsung A-screens can only choose a second-tier option.
Second, Samsung phones have the highest global sales, and Samsung A-screens produced and sold by themselves don't have to worry about selling!
Therefore, Samsung is absolutely the dominant party.
If mobile phone brands want to use Samsung screens, let alone negotiating prices, they have to queue up to buy them!
Lei Bus could wait two years for Samsung A-screens!
In 2019, Apple's sales fell short of expectations, and it didn't complete its order volume, also paying Samsung 950 million US dollars in liquidated damages…
But Toshiba doesn't have that kind of capital.
Their screens are not the best, they have many competitors, and they are in urgent need of large customers!
This is Wang Yi's confidence in aggressively cutting prices!
720P high-resolution screens are currently the most advanced screens.
Both Toshiba and Sony have invested heavily in R&D, updated their product lines, and started mass production!
They are just waiting for large customers to come knocking.
This year, iPhones, Meizu, and Xiaomi all use low-resolution screens, and Toshiba's low-resolution screens are also selling very well.
But next year, flagship phones will start widely adopting 720P high-resolution screens.
If Toshiba doesn't keep up in time, they will be completely outdated!
Toshiba has no choice but to vigorously develop 720P high-resolution screens!
And screens are a typical scaled industry, where R&D is the most expensive, and production lines are the most expensive!
The more they produce, the lower the average cost.
If Toshiba only produces 100,000 high-resolution screens, the average cost per unit would be over 100 US dollars!
If they produce 1 million units, the average cost per unit could drop to around 40 US dollars!
If they produce 5 million units, the average cost per unit could drop to around thirty US dollars!
If it's 10 million units, the average cost would be even lower!
Whether to keep up with the trend of 720 high-resolution screens or to make a profit, Toshiba has no choice but to secure Wang Yi's big order for 5 million display assemblies!
If Wang Yi chose Samsung's A-screens, he would be the subordinate party, even having to humble himself…
But taking a step back and choosing Toshiba, Wang Yi would be the absolute dominant party!
Take a step back, and the world opens up!
Moreover, in the first half of 2011-2012, iPhones and other phones were mostly using low-resolution screens.
Wang Yi directly using Toshiba's 720P high-resolution screens would already be considered top-tier, second only to Samsung's flagship, making it globally second best!
Completely sufficient!
As long as they negotiate a suitable price, it will be done.
Of course, if Toshiba's price isn't suitable, there's also Sharp, Kyocera, and even Hitachi… all of whom can be negotiated with.
As screen negotiations reached an impasse and Wang Yi was about to leave, Ohashi Taichi decisively changed the topic:
"Chairman Wang, do your phones need memory and flash storage? We at Toshiba have them!"
Wang Yi stopped.
Since he was already here, this was something worth discussing.
Global top-tier storage suppliers like Samsung, Hynix, and Toshiba… are all very good.
If Toshiba offers good value, there's no need to go to Korea to find Samsung or Hynix.
After all, Hynix is a supplier for the iPhone 4s, and its storage production capacity is prioritized for the iPhone.
As for Samsung… Wang Yi truly dislikes them.
In the future, apart from a few Samsung Super AMOLED screens, he will avoid cooperating with Samsung whenever possible!
As long as Samsung isn't given opportunities for cooperation, there's no fear of being throttled by Samsung!
Seeing Wang Yi's interest, Ohashi Taichi's face lit up with joy:
"Chairman Wang, storage is a mature technology, with low costs, so the price is easy to discuss. To be honest, industry prices are all similar. If Chairman Wang orders a large quantity, Toshiba will give you the absolute lowest price directly!"
"Good!"
Wang Yi became interested, he liked this straightforwardness.
Both parties returned to the meeting room and began negotiations for memory and flash storage.
"Chairman Wang, for 1GB LPDDR2 memory, if you need 5 million units, Toshiba will give you the bottom price directly: 12 dollars!"
Zhu Changlin had already obtained the bill of materials for Xiaomi's first generation.
These things were not secrets.
Xiaomi's 1GB LPDDR2 memory cost 14 dollars.
Toshiba offering 12 dollars to Wang Yi was not expensive by comparison, but still not cheap enough!
Wang Yi said decisively:
"Cut the price again, 5 million units, order immediately!"
"This…"
Ohashi Taichi frowned:
"Chairman Wang, 12 dollars is already the floor price. If it's 11 dollars, we won't make any profit for the first two months, it would be a wasted effort!"
"It won't be a wasted effort. I'll prepay the full amount for each batch one month in advance! You receive the money, then produce and ship. You'll still earn a good profit on the remaining 3 million units!"
"Full prepayment!"
Ohashi Taichi was tempted.
Then he thought about the batch of memory piled up in Toshiba's warehouse, and the production line couldn't be left idle either…
It would be better to sell it at zero profit, just to clear inventory.
Costs would drop after two months, and they could still make a large profit later.
It's worthwhile no matter what!
"Toshiba has never done anything unprofitable, but out of respect for Chairman Wang, we will agree to your terms: 11 dollars for 5 million units!"
"Deal!"
Wang Yi breathed a sigh of relief.
This price was absolutely a good deal.
Zhu Changlin, standing nearby, found it incredible.
After all, Xiaomi might not even get this price early next year.
But Wang Yi got it by the end of September this year!
Ohashi Taichi then took out another list:
"As for ROM flash memory chips, we'll give you a bottom price of 20 dollars for 16G! 40 dollars for 32G! 80 dollars for 64G! These are the lowest prices in the industry!"
Wang Yi looked at the quotation, thinking carefully.
Xiaomi's first-generation 4G flash memory chip was 6.3 dollars.
Converted to a 16G flash memory chip, that's 25.2 dollars.
Toshiba directly offering 20 dollars, a nearly 20% reduction, was a very reasonable price.
But Wang Yi still cut the price:
"16G for 19 dollars each, 2 million units! 32G for 38 dollars each, 2 million units! 64G for 76 dollars each, 1 million units! Sign immediately."
Ohashi Taichi quickly shook his head:
"We can't lower it, truly we can't. To tell you the truth, the Hynix flash memory chips purchased by iPhone 4S also cost 19.2 dollars for 16G, 38.4 dollars for 32G, and 76.8 dollars!"
It is well known that iPhone has large order volumes, settles payments promptly, and has the most say with suppliers.
The prices iPhone gets are also the lowest prices!
For example, for 16G flash memory, iPhone orders a lot, at 19.2 dollars per unit.
For Huawei or Xiaomi, even with large orders, it would still be 20 dollars.
Even if Wang Yi orders 5 million units at once, the price can only be 20 dollars!
Wang Yi held up a finger:
"It can be lowered. I'll also prepay the full amount one month in advance!"
"Chairman Wang, we truly can't lower it. Even if you prepay the full amount a month in advance, the lowest price will still have to be a bit higher than iPhone's! Really!"
Seeing Ohashi Taichi's resolute stance, Wang Yi really wanted to say, 'At the price I stated, 5 million units, full prepayment at once!'
But calculating it, he would have to pay over 1.2 billion at once… Wang Yi still held back!
If it's a bit more expensive, then so be it!
It's better to pay in batches, so the pressure is less.
Wang Yi stood up:
"For a big order of 5 million units, prepaying each batch one month in advance is already the greatest sincerity, something even iPhone can't do. So, the price iPhone can get, I must also get!"
"Ohashi, please consider it!"
Wang Yi's meaning was very clear:
Xingyi phones must also get the bottom price that iPhone can get!
Even if it can't be lower than the iPhone's price, it must at least be on par!
"This…"
Ohashi Taichi fell silent, then smiled:
"Chairman Wang, let's have a meal together, and I'll discuss it with the board of directors!"
"Alright."
Toshiba hosted a luncheon to entertain Wang Yi.
After the meal, Ohashi Taichi sighed:
"As Chairman Wang said, the same price as iPhone! We hope Toshiba and Chairman Wang can achieve a long-term strategic cooperation!"
"No problem!"
Wang Yi smiled:
"If Toshiba is always so supportive in the future, then Xingyi phones' storage orders can prioritize Toshiba!"
Wang Yi and Lei Bus had different approaches.
Lei Bus pursued zero inventory, set low prices for phones, and used initial hunger marketing.
A few months later, when costs dropped, they would then procure, produce, and release in large quantities.
Typically ultra-low price, fast turnover, zero inventory.
They would also source from several suppliers, taking from whoever was relatively cheaper.
Wang Yi, like iPhone, preferred to build long-term strategic partnerships.
He would directly place large orders at once, pushing supplier prices to the lowest, then procure, produce, and stock up in large quantities.
Shipping in large quantities as soon as they launched!
As a supplier to Wang Yi, they might not earn much on the first two batches of components due to price pressure, but they would earn a good profit on the subsequent three batches!
Currently, Apple regarded LG screens as a strategic partner; it was only later, when LG faltered, that they used Samsung.
Hynix storage was also a strategic partner of iPhone.
Wang Yi also planned to make Toshiba storage a strategic partner for long-term cooperation.
As for screen partners, this year he could choose Toshiba or Sharp.
It all depended on the price.
The advantage of this long-term strategy was that when they had the latest products, they would prioritize supplying Xingyi Technology.
Furthermore, Xingyi Technology could also customize screens at low costs!
Subsequently, both parties drafted the contract, lawyers confirmed it was fine, and they signed on the spot.
As agreed, 5 million units of flash memory + 5 million units of RAM would be delivered, starting early November, with one million units delivered monthly until early March next year, completing the delivery!
Wang Yi had to prepay for one million units one month in advance.
For example, in early October, he would have to pay for the 1 million units of RAM + 1 million units of ROM due in early November.
After the meal, Wang Yi went directly to Osaka City, preparing to negotiate for Sharp's screens.
Sharp also received Wang Yi and his entourage with high standards.
First, he signed a big order for 10 million lens modules with Sony, and then a big order for 10 million storage units with Toshiba, which made Sharp restless.
This was definitely a wealthy patron, a big customer!
Apart from iPhone, no one was wealthier or more influential than Wang Yi!
But there was only one iPhone, and it was currently in a honeymoon period with LG, rarely cooperating with Sharp.
So Sharp could only strive to secure the big order from Xingyi phones!
After all, there were only a few smartphone giants at the time.
iPhone used LG screens, Samsung used its own screens.
HTC's new phones also used LG screens…
The remaining Meizu and Xiaomi phones all used Sharp screens, but they were all inexpensive low-resolution screens with small volumes.
Sharp was too lazy to take orders of one or two hundred thousand units at a time!
Sharp's latest 720P high-end screens also hadn't found large customers!
They were also worried sick!
Wang Yi looked at Sharp's high-resolution screen; the quality was indeed good, a little better than Toshiba's.
In the LCD screen field, no one could surpass Sharp.
Not even JDI, formed later by the merger of the three giants Sony, Toshiba, and Hitachi, could.
But in the OLED screen field, it depended on Samsung and LG!
And in the Super AMOLED field, Samsung reigned supreme.
One could only say each had its strengths.
A few years later, LCD screens would be trashed, and in China, LCD would be considered an original sin.
Many people were even foolish enough to believe that entry-level OLED screens could completely crush top-tier LCD screens…
But in 2011, everyone was using LCD screens, so there was no need to worry about this issue.
After some negotiation, Sharp directly quoted a bottom price: 36 US dollars!
This was one-tenth cheaper than Toshiba's high-resolution screens, which were 40 US dollars.
This price was close to Wang Yi's expectation, but Wang Yi didn't immediately agree.
No hurry, Toshiba hadn't given a second quote yet, just wait a bit longer.
That evening, Wang Yi stayed at the hotel arranged by Sharp and continued working on the villa renovation design plans.
The next day, the 29th, Wang Yi went to Kyoto again to inspect Kyocera's screens.
Kyocera's screen quality was slightly inferior to Sharp's, and not even as good as Toshiba's.
But the price was cheap; a set of 720P display assemblies cost only 34 US dollars!
When Wang Yi and Zhu Changlin were talking, they didn't avoid the Sony people.
Consequently, Kyocera's price quickly spread to Sharp and Toshiba.
This greatly angered the two giants, who successively cursed Kyocera for being shameless!
Their bottom price was 35 US dollars, but Kyocera's first quote immediately went down to 34 US dollars!
Wasn't this damn it just causing trouble?
Left with no choice, Sharp and Toshiba both convened high-level meetings to discuss prices.
This kind of big order for 5 million units had to be secured.
Even if they didn't make a profit for the first two months, it wouldn't matter; they would naturally profit once costs came down later.
More importantly, with this big order of 5 million units, their high-resolution screen costs would decrease across the board.
Subsequent brands ordering high-resolution screens later would allow them to make huge profits.
If they couldn't secure Wang Yi's order for 5 million units, the production lines couldn't be idle, and high-resolution screens still had to be made!
Then the costs would be high.
Soon, Toshiba called:
"Chairman Wang, I've settled with the board of directors. We'll give it to you for 33 dollars; we can even make no profit! Our Toshiba screens are definitely better than Kyocera's!"
"Alright, I'll think about it!"
Wang Yi smiled and hung up the phone.
One peach kills three warriors!
This was just the beginning.
All three companies wanted his big order of 5 million units.
Who would get it? That would depend on a good competition.
In reality, all three companies' screens were acceptable; even with the worst, Kyocera, consumers wouldn't notice much difference once they used it.
For a 4.3-inch screen, the difference between 720P and 480P was noticeable.
But for top-tier manufacturer's 720P screens of the same quality, non-professionals really couldn't tell much difference.
Soon, Sharp also called:
"Chairman Wang, if you want 5 million units, we'll give them to you for 33 dollars! Even lower than Kyocera!"
Wang Yi smiled:
"Toshiba is also offering thirty-three dollars, and there's even room for further negotiation."
Sharp's Marketing Department President fell silent: "…"
"Chairman Wang, our Sharp screens are the best, we'll give them to you for 32 dollars!"
"Alright, I'll consider it."
Wang Yi hung up the phone.
Kyocera's boss on the other side couldn't sit still, cursing inwardly:
'Damn it, Sharp's screen quality is already better than ours, and it's two dollars cheaper, how can we compete? Lower the price, we must lower the price!'
"Chairman Wang, if you sign today, Kyocera's high-resolution screens will only be thirty-one dollars!"
Wang Yi smiled, watching as the three major screen giants cut the price of high-resolution screens all the way from 45 dollars, 40 dollars, down to 31 dollars!
It was basically nearing rock bottom.
The reason it could be so cheap was, first, the wisdom of the ancestors – "one peach kills three warriors" – which never failed!
Second, Wang Yi had the advantage of favorable timing, geographical location, and human relations.
Favorable timing: 2011 was still the era of feature phones, smartphones were just starting, and there weren't many brands.
Other big brands had already partnered with Samsung and LG, while Xiaomi was just starting, lacked confidence, and placed small orders.
Wang Yi's Xingyi phones were the only choice for major manufacturers.
Geographical location: Japan was a small country, yet it had several screen giants like Sharp, Toshiba, Sony, Hitachi, and Kyocera.
Their intense competition gave Wang Yi a wide range of choices!
Human relations: The driver sent by Sony was a big mouth.
Wang Yi and Zhu Changlin intentionally discussed prices in front of him, and the driver would then sell the information to Sharp and Toshiba, forcing the two giants to lower their prices…
Wang Yi naturally knew what the driver was doing, but this was precisely the effect he wanted.
The Sony driver also knew that Wang Yi knew what he was doing and didn't mind, so he unscrupulously amassed wealth.
Finally, after a series of contests, Sharp secured Wang Yi's big order for 5 million display assemblies at a price of 30 US dollars!
Of course, Toshiba's bottom price was also thirty dollars.
Kyocera's price was even lower, only 29 dollars.
But Kyocera's quality was slightly lower than Sharp's, and Wang Yi preferred to spend an extra dollar to pursue quality.
Otherwise, when Xiaomi's second generation is released next year, Lei Bus would definitely use Sharp screens and relentlessly criticize Xingyi phones' Kyocera screens!
Given Lei Bus's style, he would definitely say,
"We use Sharp screens that are much, much better than Xingyi phones' screens!"
As for Toshiba, Wang Yi was also concerned that Toshiba, Hitachi, and Sony's display divisions would completely merge to form JDI, a process that might affect the supply of screens to Xingyi phones!
It would be better to wait until next year, when JDI's reorganization is complete and thoroughly stable, before cooperating.
Toshiba had no complaints about this.
After all, Wang Yi's big order for 10 million storage units was given to them, earning them more profit than screens, so they were secretly delighted long ago.
10 million lens module order to Sony!
10 million storage unit order to Toshiba!
5 million screen assembly order to Sharp!
One can only say that Wang Yi is an excellent Master of Allocating!
Not only did he negotiate the most suitable prices, but he also ensured that all three giants received equal benefits!
The only one hurt was Kyocera.
Wang Yi genuinely only asked for prices and didn't buy anything.
There was no other way; Kyocera screens in 2011 were still mediocre, but a few years later, only Sharp and JDI remained, and Kyocera truly faded into obscurity.
It most likely went bust!
Therefore, Wang Yi still bet on Sharp.
With the relationship established with Toshiba and Sony, cooperating with the reorganized JDI next year would also be easy.
Returning to Osaka City and signing the agreement with Sharp, Sharp's Marketing Department Director breathed a complete sigh of relief and enthusiastically entertained Wang Yi.
By the time the dinner ended, it was already the evening of the 29th.
Wang Yi returned to the hotel and opened his laptop.
Meiyou Novel Network had already launched yesterday for testing.
Signed authors had registered pen names and uploaded their books.
What surprised Wang Yi even more was that there were even some readers!
Amazing!
A newly launched website, without any promotion, how could it have readers?
(End of chapter)