Price reduction!

This was indeed a solution.

But it required money to compete.

Every item had its profit margin – a sweater selling for 40 yuan would bring over 10 yuan in pure profit for the department stores. Now they were willing to forgo this profit, or reduce it from 10 yuan to 5 yuan, sacrificing their earnings to win back customers from Asia. Would this strategy work?

They might even give up that 5 yuan profit entirely, selling at half price to attract customers!

This method would certainly be effective.

Nobody’s money came easily – why spend more when you could get the same quality goods for less?

However, to besiege Asia through price cuts, the state-owned department stores needed to work together.

Which items to discount, by how much, and for how long – all these need to be coordinated among the stores. Otherwise, if one foolishly reduced prices while others didn’t follow, or if Zijiangshan reduced prices by 5 yuan while Shangdu Department Store cut 6 yuan, it wouldn’t be besieging Asia but rather destroying each other internally.

The person in charge of the Zijiangshan Department Store was Lu Hongbo.

Lu Hongbo’s temper matched his name – when angered, it was like watching surging waves.

But this was just the surface.

How could Lu Hongbo have become the head of the Zijiangshan Department Store without real capability?

When he proposed the price war, the others agreed. Since he chose to be the “villain” taking the lead, Lu Hongbo didn’t hold back and expressed his thoughts.

“Asia has Hong Kong merchant backing. They don’t lack money, and when we start a price war, they’ll follow with their price cuts. Looking at us individually, we might not be able to outlast them – just look at the money they spent on promotional events during their opening. Their single cultural performance would cost us ten years’ worth of advertising.”

Lu Hongbo’s words struck a nerve with the other managers.

Being state-owned stores, they were all cautious with public funds.

Before Asia appeared, these stores spent only a few hundred thousand yuan on advertising annually, mainly on provincial TV commercials and flyers – very basic methods… but it had been enough, and this budget was their acceptable limit.

Since everyone operated this way, no one questioned the few hundred thousand yuan advertising budget.

Until Asia emerged out of nowhere.

They spent millions on opening promotions, no wonder they created such a crowded spectacle.

This was too unorthodox, which made everyone view Asia with displeasure.

Even now, though the stores had witnessed the effectiveness of million-yuan promotions, none dared to follow Asia’s approach.

They couldn’t think of more attractive promotional methods than Asia’s.

If they tried to copy Asia’s cultural performances, they couldn’t secure the same caliber of Hong Kong and Taiwan stars.

More importantly, if they spent millions on promotion but couldn’t match Asia’s business performance, they would have no way to justify it.

The managers, including Lu Hongbo, though aware of Asia’s unique internal management, like those enthusiastic salespeople who treated customers as kings, still refused to accept these changes due to their ingrained mindset… Acknowledging these differences meant admitting their inadequacy, that they hadn’t thought of these sales methods before Asia!

During the planned economy era, state-owned department stores had no performance requirements. Goods just sat there, and people needed ration coupons even to buy two meters of cloth. Any loose fabric that didn’t require coupons would cause a frenzy among customers.

Back then, state-owned stores had grown accustomed to their arrogance, from top management to front-line sales staff. After so many years, why should they change?

If they could suppress the upstart Asia, they wouldn’t need to change and could continue running their stores with ease.

Instead of acknowledging their shortcomings, they blamed others for being too good…

No one, including Lu Hongbo of Zijiangshan Department Store, was willing to spend millions on promotions like Asia.

But when it came to a price war, everyone had ideas.

Led by Lu Hongbo, they criticized Asia thoroughly before developing a detailed price war plan.

As Lu Hongbo said, with Asia’s Hong Kong merchant backing and their lavish opening ceremony showing their financial strength, the stores couldn’t fight alone – they needed to gang up.

For instance, the Zijiangshan Department Store would discount women’s clothing while the Shangdu Department Store would reduce leather goods prices. The stores would take turns discounting different products, staggering categories and timing, and letting customers choose any store based on their needs… as long as customers didn’t go to Asia, they would consider it a victory!

“This way, when Asia tries to win back customers, without allies, they’ll have to implement across-the-board price cuts,” Lu Hongbo suggested, proposing that the state-owned stores share the losses while Asia would bear them alone.

Even wealthy Hong Kong merchants couldn’t sustain constant losses, could they?

If they couldn’t bear the losses, they’d have to bow to the state-owned stores. Then Lu Hongbo and others could sit down calmly and teach Manager Xia about seniority and proper business conduct!

The phrase “Central Plains Commercial War” had been tightly bound to Asia in the previous life.

Xia Xiaolan had known this day would come. Asia’s rise not only threatened the state-owned stores’ economic interests, but its service-first and customer-first business philosophy also challenged the outdated management system.

This was an inevitable battle between private and state-owned enterprises.

Any emerging entity would face numerous obstacles, and Asia was no exception.

However according to Xia Xiaolan’s knowledge, the “Central Plains Commercial War” should have happened in 1990.

However, this life, Shangdu Asia Department Store opened a year earlier than in the previous life, and Xia Xiaolan created an even bigger stir than Zhu Suizhou. These triggered a chain reaction… Just as Xia Xiaolan planned to stabilize Asia’s operations and step back from front-line management, she suddenly discovered that the state-owned stores, led by Zijiangshan Department Store, had united to launch a price war against Asia!

“September 20th, Zijiangshan Department Store offers 30% off all women’s clothing.”

“September 21st, Shangdu Department Store announces major appliance price cuts!”

“September 22nd, Shangdu Building…”

The flyers from several state-owned stores arrived at Xia Xiaolan’s office almost immediately – this was a declaration of war!

Song Minglan was furious.

Asia hadn’t even been open for a month, was this necessary from the state-owned stores?

Uniting against Asia, excluding Asia, targeting Asia.

“…They want to force us to close down, this is too much!”