Chapter 101: Arms Race

In just half a day, seven programming training institutes lined one entire street. Five of them expressed interest in buying computers from Su Mu, while the other two small schools were already equipped with new models, rendering Su Mu and Li Anping’s little scheme utterly useless.

Among those five, two had paid a modest deposit once they received Su Mu’s quote. The entire procurement of 114 computers was successfully transferred into Su Mu’s hands, with two more institutions still wavering—promising to reply tomorrow and likely intending to shop around among three suppliers.

Su Mu felt no concern. His margin had been squeezed to less than eighty dollars per unit, and the order was hardly in the thousands. Competent vendors would have no reason to scramble. Those lacking muscle, however, would have gouged when opportunity knocked; their quotes stayed low, typically offering around ten percent profit—double what Su Mu aimed for. Personal computers were still new on the market, sales had long been sluggish, and retailers were forced to raise prices just to survive, even if it meant eating their own seed corn. Profit came only when someone bought; otherwise, there was nothing. Su Mu understood this perfectly: as a middleman he carried no costs, so every dollar earned was pure gain. He preferred to slash prices and move volume, provided the margin remained adequate. A few thousand dollars in profit would satisfy him.

The first contact had been with Boss Gavin. After Su Mu’s deception, both he and Li Anping assumed the roles of salesmen when approaching the heads of other training institutes. The pressure applied to those bosses was always the same: “Your competitors just bought new computers.”

In the early 1980s, thousands of ambitious young men and women had streamed into Silicon Valley’s training programs, breeding fierce rivalries among the schools. No one wished to fall behind in the arms race, and the resulting chaos was only natural. Su Mu had simply read their needs with uncanny insight, winning their psychological allegiance. It was a brilliant open strategy. Even if word spread later that Su Mu had approached everyone, some would still place orders—each terrified their rivals would upgrade equipment and steal their students away, an echo of the fierce competition between internet cafés two or three decades hence. Besides, the prices Su Mu quoted were genuinely low; no one wished to haggle over money. He had no fear his ruse would be uncovered. That Saturday afternoon, spent entirely on the hardware refresh for these very schools…

At this moment Li Anping stood alone beneath a streetlamp, gazing at the sunset in a daze, suddenly overcome by a longing for home.

He had once believed he would never miss home. Leaving the cramped little place in Chinatown that had trapped him for more than a decade had felt like liberation, yet now he realized how mistaken he had been.

Several days passed without calling home. He intended to speak with his parents tonight and reassure them of his safety. Recalling the afternoon’s events made him smile.

He had never realized that his friend Su Mu was so shrewd in business. Several million-dollar success stories had been spun round and round by the two of them, stirring an unexpected sense of achievement. Silently, he wished Su Mu nothing but continued good fortune.

Above the advertising board loomed the slogan of the training institute—“Beyond Dreams.” This afternoon Su Mu had promised Boss Gavin that, after consulting his “brother,” he would reveal the price. Right now Su Mu was inside the office discussing terms; Li Anping waited outside.

In half a day Su Mu had earned more than his father had toiled for an entire year running the restaurant, walking as though carried by the wind. Afraid Boss Gavin might slip away, Su Mu tugged Li Anping onto the bicycle and said, “Guess?”

“…You still need to guess?” Li Anping shot back. “It’s written all over your face—smile lines deeper than my dog Wangcai’s.”

Wangcai was a Shar-Pei, a Chinese breed expensive even in America. Breeding a single litter could net a hundred dollars. If he could, Li Anping wished that fat dog would breed every day, allowing it to earn while lying at home. Unfortunately, it had been mated only once; demand for stud dogs in the States was low.

“Hahaha! On the bike!” Su Mu replied. “Um, settled—one hundred forty units. I can make this much!”

If they had used the old price and paid Charlie only twenty dollars per unit after shipping, Su Mu would still pocket more than fifty dollars each.

Seeing the “seven” gesture, Li Anping drew a sharp breath and muttered, “Holy cow, one day and over ten thousand bucks!”

“Not just that—some accessories too. Next week we set up a company. It’s seriously profitable; the market is huge!” Su Mu beamed with pride.

“Anping, once I register the company next week, help me sell. We’re still getting screwed this way. I’ve got a new idea: later, when we open distribution, we can build our own computer brand, source parts directly from manufacturers, and assemble and sell at rock-bottom prices. We’re still young; today’s profit high has me imagining the future.”

This was undoubtedly high ambition, yet it burned with passion born of youth and boundless possibility.

To Su Mu the future stretched bright and clear; any obstacle could be overcome. The bicycle beneath his feet seemed to carry the momentum of a Ferrari, swelling again…

Li Anping was bewildered. “Such high-tech stuff—you can just make it?”

“Who said I’m making? I’m only assembling. I just discovered every computer component is available on the market. Once assembled, buy parts cheap—selling price will be low… not yet, my money’s too tight. Later, maybe.”

Su Mu still possessed self-awareness; he did not make grand boasts. He knew exactly how much money was in his account.

“If you think you can earn, go for it. I don’t understand these things. Walking with you to promote is fine, but I couldn’t do it alone.”

Li Anping shook his head. Most of today’s conversation had circled money and business; he still found it alien. Vaguely, he sensed Su Mu was different—confident in every word, whether discussing deals or now.

Confidence was something almost everyone in Chinatown lacked.

Stimulated, Li Anping spoke again. “But I can practice first. At least I need to learn the basics of computer data, so if promotion fails, don’t blame me.”

“Deal.”

Su Mu asked again, “This money today is yours. Next week we register the company—will you invest?”

“Invest! You eat the meat, I drink the soup. I’ll take a tiny share of the business you thought up—one percent?”

Li Anping thought simply.

One day’s earnings over ten thousand dollars meant he would pocket more than a hundred, a month’s salary reaching three or four thousand!

Thinking of returning home and seeing his parents’ faces, he knew they would be overjoyed.