Chapter 50

Finding a suitable management talent is not something that can be resolved in a day or two. After Li Xuan told the headhunting company his requirements, he patiently waited for the results.

By the time Li Xuan returned to school, the start of the semester at Sun Yat-sen University had been underway for several days. He finally understood why Bill Gates, Michael Dell, Sergey Brin, and Jerry Yang either dropped out or took a leave of absence; balancing studies and entrepreneurship simply left no time.

Li Xuan skipped many classes in his first semester. Although he barely passed, the college had already talked to him. If he continued like this, he could forget about his scholarship. Fortunately, he no longer needed to rely on the scholarship to live.

"Mr. Hattori, I am very sorry, I can only meet you here in this small café!" Li Xuan walked into the café and found that Hattori Kenshin had already been waiting there. He said apologetically.

"No problem, I haven't been back to the quiet campus and smelled the scent of books since I graduated from university. Today, I took the opportunity to visit Sun Yat-sen University with you; it's very beautiful!" Hattori Kenshin stood up immediately when he saw him come in and said.

At noon, Du Wenqiang called Li Xuan's dormitory and said that Hattori Kenshin, a board member of Seiko Epson, had just flown from Japan to Hong Kong and hoped to meet with Li Xuan. Li Xuan had classes in the afternoon and evening, so he planned to meet Hattori Kenshin the next day. However, the other party clearly couldn't wait and rushed to the campus of Sun Yat-sen University to wait for him.

"Mr. Li, I have come this time on behalf of the company to discuss the production contract for the game console motherboard with you!" Hattori Kenshin nodded and bowed, saying.

Previously, Oriental Electronics had lured Epson to produce the arcade game console motherboard by offering the production rights for two arcade games in the Japanese market as a trade-off. At the time, the prospects for the new game console were unclear, and Oriental Electronics was in a weak position, so they had to give up some of their interests. However, Li Xuan had secretly played a trick and only signed a contract with Epson for the production of 10,000 arcade game consoles.

Although this contract, worth a few million dollars, was not large, it was enough to persuade Epson to adjust its motherboard production line and start producing game console motherboards. Epson, while optimistic about the two arcade games, "Hong Kong Blocks" and "Tank Battle," was still an outsider in the gaming industry and did not have Li Xuan's foresight. They were somewhat conservative in their estimates of the potential of these two games, so they did not object much to Li Xuan's proposal for a 10,000-unit production contract.

However, Oriental Electronics had now overcome its most difficult period. Leveraging the success of the Western Electronic Show in San Francisco, they had successfully entered the largest and most competitive North American market, becoming a new star in the arcade industry, poised to be the next Taito. Epson also attended the Western Electronic Show and had already reported the news back to the headquarters in Japan.

Before Epson could react, Oriental Electronics, after signing contracts with a series of American arcade distributors, immediately placed a production order with Epson. The first order was for 10,000 arcade game boards. This meant that once this order was completed, Oriental Electronics would have fulfilled its obligations to Epson, and subsequent motherboard purchases could be made from any supplier.

At this point, Epson realized that their sales forecast for the two arcade games was seriously off. If they did not take action, a big piece of meat that was almost in their mouth might slip away. The company's board of directors, after an emergency meeting, immediately dispatched Hattori Kenshin, who had previously met with Li Xuan, to fly to Hong Kong to negotiate and try to secure a larger motherboard production contract.

"Are you talking about this? I have already instructed the company to place an order according to our previous agreement. Is there any problem on your side? Don't scare me; our company is eagerly waiting for your motherboards to assemble the game consoles!" Li Xuan also had some acting skills. He knew why the other party had rushed over in such a hurry but now feigned confusion.

"There is no problem with the order; please rest assured, Mr. Li!" Hattori Kenshin waved his hand and said with a bitter smile, "I am talking about a new order. We at Epson hope to continue providing motherboard production services for Oriental Electronics!"

"Regarding this issue, Mr. Hattori, you might be disappointed. After all, your company is not a professional computer motherboard manufacturer!" Li Xuan said with a regretful look.

"Please rest assured, Mr. Li. Our Seiko Epson started from the mechanical watch business, and quality and precision have always been our core values. The game motherboards we produce, like our Seiko watches, undergo strict quality control. The motherboards we have produced for various Epson printer models have shown excellent performance in terms of failure rates, which is a testament to our quality!" Hattori Kenshin said confidently.

"Moreover, after a discussion by our board of directors, we consider you, Mr. Li, a sincere friend of Seiko Epson. We are willing to reduce the price of each motherboard by ten dollars on top of the original price!"

When Li Xuan heard that the Japanese had directly resorted to the price reduction strategy, the corners of his mouth couldn't help but curl up. The situation was now completely reversed from when he went to Japan recently. He could now sit back and watch how the other party would make their offer.

"Mr. Hattori, when I visited Japan last time, you treated me warmly, and I am very grateful. Since you consider me a friend, I will be honest with you. The two arcade games, 'Hong Kong Blocks' and 'Tank Battle,' have performed very well in the U.S. market. We also did a trial run in a small city in San Francisco, and the players' reactions were very enthusiastic.

According to our company's estimates, 'Tank Battle' will sell at least 100,000 units in North America, and 'Hong Kong Blocks' will not be far behind! Moreover, we have already started developing other new games. Oriental Electronics cannot always entrust the most important and core task of game console motherboard production to other factories, so we have already put the construction of our own motherboard factory on the agenda!"

Li Xuan paused, watching Hattori Kenshin frown and think about what he had just said. He took a sip of the rich coffee, giving the other party some time to digest the information, before continuing, "If Epson considers Oriental Electronics a sincere partner and is willing to assist us in building a game console motherboard factory and provide valuable advice and experience in production management, I would be very willing to continue having your company produce the game motherboards for us until our factory is built.

Of course, the reason your company was willing to produce the game motherboards for us was mainly to fully utilize the capacity of the newly established wafer fab and quickly turn a profit. If your company is willing to assist us in building the motherboard factory, Oriental Electronics can also sign a chip procurement contract with Epson, and the game motherboards we produce will still use your company's chips."

If Oriental Electronics agreed to continue purchasing chips from Epson's wafer fab, even if they gave up the game console motherboard production business, it would not be too difficult for Epson to accept.

Li Xuan stopped talking and quietly sipped his coffee. Building a motherboard production factory was much more challenging than building an arcade assembly factory. Most of the processes in assembling arcades had no technical content.

In contrast, the technical content of a motherboard factory was much higher. The production of motherboards generally involves several processes: surface mount technology (SMT), manual insertion, testing, and packaging. SMT involves welding resistors, capacitors, and chips onto the PCB board, which is mostly done using advanced automated production lines. Manual insertion involves welding components and connectors that the automated lines cannot handle, such as vertical capacitors. After that, there is a testing process, and if it passes, the product can be packaged and shipped.

Li Xuan could buy those advanced machines with U.S. dollars, and the manufacturers would be responsible for training on how to use them. However, specific production management experience is something no one teaches you; you have to learn and adjust through trial and error.

If a mature company like Epson could share all its knowledge, Oriental Electronics could avoid many detours.

PS: The updates have been unstable these past few days, please bear with me, and I appreciate your recommendations!

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