Chapter 40: An Initial Agreement

To be fair, Sumu had a sharp mind but lacked much experience in society. Fortunately, the American atmosphere valued directness, and even in Chinatown, where Chinese people gathered, this environment had its influence—people spoke their minds plainly, especially in business, with no need for subtlety.

Convenience stores were not Sumu’s favored investment; he was more interested in computers, the internet, and other high-tech industries. Yet, given the current circumstances, investing in a supermarket was the most straightforward and accessible path. He knew little about those emerging high-tech fields and would never get involved before thoroughly understanding them. Moreover, ten-odd thousand dollars was more than enough for ordinary living expenses, but far from sufficient for high-tech investments—he might not even make a splash before the money was spent. Investing in a supermarket suited Sumu’s situation perfectly.

After voicing this thought to Mr. Han, he couldn’t help but worry. If he were rejected, it would be troublesome; perhaps he’d have to quickly convert his money into stocks—Apple, Intel, or Microsoft—acting before his parents or the old man found out, and then dealing with the consequences later.

At this age, Sumu felt he should decide major matters himself. Chinese children born in America received Eastern education from their families and Western education from schools and society. Many families, like their Western counterparts, expected their children to become financially independent around eighteen, and many youngsters yearned for independence. Sumu was no exception.

For Mr. Han, getting an investment of over ten thousand dollars was certainly good. He was relatively wealthy in Chinatown, but his assets lay mainly in real estate—houses, cars, shops. Profits from the convenience stores were reinvested, so he had little cash on hand, about two hundred thousand dollars, with a portion reserved for emergencies.

He originally planned to invest just over ten thousand dollars to open a larger convenience store. But after hearing Sumu mention televisions and clothing—though some could be bought on credit—he realized the money wouldn’t be enough. Thirty or forty thousand dollars would be about right, and with Sumu’s intended investment, they might just manage.

Furthermore, having someone invest alongside him meant sharing the risk. Mr. Han believed supermarkets had a promising future, but there was no such thing as a guaranteed profit—exceptions always existed. Compared to Sumu, he was more cautious and welcomed someone to help shoulder the risk; if they made money, wonderful, and if they lost, he would lose less.

After quickly weighing his options, Mr. Han smiled at Sumu and said, “You sound as if you’re threatening me. Don’t play games—I could always go visit other supermarkets myself and learn how to run them.”

After getting into the car, Sumu replied, “Do you think others will reveal their business secrets? Even if they did, you might not be able to learn them. For example, Walmart in the south, which has developed impressively, recently spent over twenty million dollars to launch a commercial satellite. Do you know what it’s for?”

“A satellite costing over twenty million? What’s it for? Tell me,” Mr. Han responded cheerfully.

Being young was a disadvantage; even though Sumu deliberately acted mature, Mr. Han still saw him as a child showing off. Ultimately, Sumu’s status and funds weren’t enough. If he were the child of a billionaire, Mr. Han wouldn’t be so casual when talking business.

“From procurement to inventory, distribution, delivery, shelving, and sales, Walmart has achieved computer network control of the entire process. They build huge warehouses to store bulk goods bought at low prices, then ship them wherever needed. Even if we open a supermarket, our prices can’t be lower than theirs; we can’t afford such a supply network, and there’s no need to spend so much on satellites for logistics. But many of their concepts are worth learning.”

The car was moving forward, flanked by towering buildings. Ten thousand dollars would only buy a small apartment nearby; even an ordinary middle-aged person’s annual income might reach a million dollars. Countless facts proved that Sumu remained poor, far from financial freedom.

When Sumu finished speaking, Mr. Han changed the topic, “Are you confident you can learn? I mean, if we open a store, could you make it something like… that Walmart? I think you should discuss it with your parents first. If they agree, I’ll partner with you. Let’s decide up front: I’ll handle management, and we’ll find someone to oversee the accounts together—so everyone can feel secure.”

Mr. Han managed more than ten convenience stores. Sumu felt confident handing the store’s management to him; convenience stores and supermarkets were both retail businesses, with similarities. Sumu had never thought of managing it himself—he would soon start high school, and hiring someone else would be too costly.

As long as the finances were managed properly, Sumu saw no issue. He nodded and told Mr. Han, “Fine, you handle management once the store is open. But as for telling my parents… that should wait. They don’t understand what a supermarket is, and if they object, it would be troublesome. So for now, please don’t mention it to my father. Let’s first tour the area around Chinatown and see if there’s a suitable shop. It must be spacious, and we need to talk to suppliers. The decor doesn’t have to be luxurious, but it must look comfortable.”

…

Having reached a preliminary agreement, Sumu found it strange—he’d left the house that morning as a poor kid, and now was about to invest more than ten thousand dollars in business.

Mr. Han, too, found it amusing. The young fellow who worked in his store was now set to be his business partner; fate was indeed peculiar.

After spending some time returning to the area near Chinatown, Mr. Han suggested visiting a newly built mall, which he had considered opening a store in yesterday, believing it to be a good location.

The mall was situated between Mexico City and Chinatown, right at the corner. It had been completed at the end of last year; before that, the area lacked any large shopping center, and people were accustomed to shopping at old stores, mainly for bargains. Thus, the mall’s foot traffic was low.

Land nearby was cheap, so the developer created a large parking lot. The entire department store was four stories tall, with red exterior walls and glass windows plastered with rental advertisements. When Sumu got out of the car, he asked, “There doesn’t seem to be anyone here. Are there really such large shops available? Wouldn’t opening in Chinatown be better, with more Chinese residents and lower rent?”

Mr. Han replied, “There are grocery stores everywhere; once we open, troublemakers will appear. After so long in business here, I know their temperaments. Besides, there aren’t shops large enough—at least a thousand square meters is needed. I think this place is good; I visited in March, and the third and fourth floors were almost empty. I heard the fourth floor will become a cinema, which should be promising. Renting now, the price shouldn’t be too high…”