CH4 : Contract

"Who did you say you were?"

"I'm Woo Chan-soo from Daese Industries. Unfortunately, I lost all my luggage at the airport, so I don't even have a business card to give you."

I unintentionally mentioned the name Daese.

It didn't exist yet, but it would be created when I returned home.

"Mr. Woo from Daese Industries... This is the first time I'm hearing of it."

"It's our first venture into Singapore, but we're growing rapidly in South Korea. We'll easily achieve an annual revenue of 400,000 dollars this year."

It was not a lie.

With this contract, Daese Industries would hit 400,000 dollars in sales in its first year.

"Hmm, 400,000 dollars in annual revenue means it's not a small company. So, what equipment does Daese Industries use?"

He was testing me to see if I was a fraud.

"We use 100% Karl Mayer equipment. That's the reason I came to see you, Mr. Razak."

Daese Group and Germany's Karl Mayer company had a very close relationship.

I heard that when Chairman Woo started his fabric business, he made a huge success with Karl Mayer equipment, so he had a very good impression of it.

Ah, considering this is the era when Germany is divided into East and West, I should say West Germany's Karl Mayer.

Perhaps because of this, Chairman Woo preferred to collaborate with European companies, especially those from West Germany, rather than Japanese ones.

Of course, I also think West Germany is better than Japan.

"The reason you came to see me?"

"Since the cotton market is dominated by the Chinese, isn't it time for you, Mr. Razak, to go all-in on synthetic fibers? The Karl Mayer machines we use are the best for weaving synthetic fiber fabrics."

"..."

Razak looked slightly overwhelmed.

It was natural. Not only did I answer his test question correctly, but I also told him that he needed to dominate the synthetic fiber market to compete with the Chinese.

I never thought that memorizing Chairman Woo's founding story and taking exams on it when I was a new employee would help me like this.

I couldn't believe I still remembered the name of the weaving machine manufacturer, Karl Mayer.

"Would you like a drink?"

"I was just getting thirsty, that sounds great."

"Come this way."

After talking in the corridor in front of the elevator, I was invited to the suite room.

The room had impressive decorations characteristic of India.

No, it was closer to an office than a room.

Trickle.

Razak offered me a cold glass of champagne.

It was a sign that we were about to discuss business seriously.

"Here are some samples. Choose the one you like, and we can supply as much as you need."

"Let's take a look."

Razak touched and examined over a hundred samples one by one.

He seemed to have a good sense of the fabric as a giant in the textile industry.

"I like numbers 24 and 87."

He had a good eye.

Both were nylon-based, with number 24 having around 5% cotton and number 87 having about 35% to 45% cotton blend.

The blend ratio was appropriate, and both were weft-knitted fabrics, which meant they wouldn't unravel easily.

They were representative of what is called tricot fabric.

'What? How do I know this so well?'

Despite it being a heroic tale I heard as a new employee, I remembered the fabric types so clearly?

The most amazing part was that it wasn't a vague memory; it was as if I was seeing the PPT materials the instructor used right before my eyes.

Clearly, my major was in construction or heavy industry plants. Am I a genius?

"What's wrong? Is it difficult to supply that fabric?"

'Huh! How could I be thinking about something else at this moment!'

I wanted to slap myself.

How could I be thinking unnecessary thoughts at the moment of a lifetime opportunity?

"No, it's completely possible. I was just thinking that since it's tricot fabric, the unit price might be a bit high..."

"It does look a bit expensive. So, how much can you supply it to me for?"

"How much would be profitable for you, Mr. Razak?"

If I set the price, it would inevitably be negotiated down.

If I'm going to lose the initiative anyway, it's better to readily accept the client's request.

Later, when my company's market dominance grows, the right to set prices will naturally fall into my hands.

"... If I could get it for 70 cents per yard... no, 65 cents per yard, that would be great."

Fabric is sold by length.

A yard is about 91 cm. Commonly, clothing merchants refer to it as '1 ma.'

"65 cents per yard... Alright, we'll supply it at that price."

"!!!!"

Razak was surprised when I agreed immediately.

He must have offered a price expecting me to raise it to at least 70 cents, but I didn't raise it by a single cent.

Historically, it was probably contracted at 65 cents.

How could Chairman Woo, who was only 27 at the time, make a proper deal with Razak?

It's obvious he would have contracted at the price Razak suggested.

In other words, even at this price, it would still be profitable.

"Mr. Woo, why didn't you raise the unit price? Negotiating prices is basic for a merchant."

"I have a different thought. Since you've offered the lowest price, wouldn't you order the maximum quantity?"

"!!! The lowest price, the maximum quantity!"

"The strategy of small margins and large sales is why Daese Industries is growing rapidly. Surely you wouldn't order just 10,000 or 20,000 yards after negotiating the price down to 65 cents per yard, right? Especially you, Mr. Razak, the hope of Indian merchants."

"Hahahahaha!!"

Razak laughed heartily, seeming to enjoy my words.

Then he drank his champagne heartily.

"200,000 yards! How about it? That's the maximum quantity I can offer right now."

"Sounds good. Let's make a contract."

At 65 cents per yard, 200,000 yards would amount to 130,000 dollars.

130,000 dollars is a huge amount in 1960s South Korea... Wait, what was the exchange rate back then? About 500 won? If 130,000 dollars at an exchange rate of 500 won is... 65,000,000 won?

What? Not even a billion won?

'Wait, is 130,000 dollars correct?'

Although I extended my hand for a handshake, I felt dizzy after doing the mental math.

I remembered hearing that the original contract was for 400,000 dollars... Did I just agree to a ridiculous price?

A cold sweat ran down the back of my neck.

Damn it... How could I get so excited like a rookie?

"Haha, making a contract immediately. That's not right."

"Ah, is that so?"

Fortunately, Razak put the brakes on.

"We Indians only make big contracts with those we've had a meal with. How about it? Are you free this evening?"

"It would be an honor if you invited me."

Did the original contract involve price adjustments over dinner?

I knew nothing about the cost of raw yarn, processing, logistics, and taxes in the 1960s, so it was hard to judge whether the original price was right or the quantity was wrong.

If I consider that about 2 yards of tricot fabric are used to make a pair of pants, the material cost alone is 1.3 dollars, about 650 won.

Adding other costs, it would be around 1,000 won, but would a pair of pants cost about 1,000 won in 1960s Southeast Asia?

In the 21st century, when traveling to Southeast Asia, a pair of elephant pants cost about 2,000 to 3,000 won, right?

Considering inflation, the price of 65 cents per yard in the 1960s doesn't seem unreasonable.

'So, was the exchange rate calculation wrong? Or was the quantity insufficient? Damn, do I just have to try?'

No matter how much I thought about it, it was hard to judge if it was a loss or a gain.

Deciding to give it a try made me feel more at ease.

"The restaurant is this way."

"Thank you."

Razak took me upstairs.

He was using a part of the hotel's sky lounge all by himself.

As Razak appeared, a crowd of neatly dressed people rushed to serve him, like he was royalty.

***

"Haha, did you really buy that suit for 100 dollars?"

"I'm not much of a bargainer."

"Did you say it was at Indiran Tailors? I'll have to give that guy a piece of my mind. How dare he overcharge my guest."

"No, it's fine. I got a dress shirt as a bonus, so it was a good deal."

From the way he spoke, he didn't seem like someone who overcharged.

So, is 65 cents per yard a reasonable price?

Was it that he ordered more than 200,000 yards historically?

It doesn't seem likely he would give more than 200,000 yards.

I guess heroic tales are often exaggerated.

For a novice merchant, securing a 130,000-dollar contract isn't bad at all.

Starting with this amount would be enough.

"Where are you staying? I'll have my assistant send the official contract. You just need to sign it."

"I plan to stay at the Grand Hotel across the street. If you mention my name, they'll know to let you in."

"Let's do that. Shall we toast?"

"Let's toast."

"To the Young Tiger of South Korea."

"Young Tiger?"

"In India, we compare great young men to tigers. Especially white tigers, which are said to be born once in a hundred

 years. Try to become a white tiger."

Razak gave me a blessing.

Young Tiger, it seemed like a good product name for fabric.

Clink!

"To the Young Tiger!"

"To the Young Tiger!"

We toasted and finished our meal.

I had the Adelphi Hotel staff arrange a room at the Grand Hotel.

As Razak's guest, a room that wasn't available suddenly became available, and I was given all sorts of benefits, like free access to the Executive Club.

It was a luxurious room. After a warm bath, I couldn't resist the sleepiness that overwhelmed me.

***

Adelphi Hotel, Sky Lounge.

Razak was enjoying the afterglow of the meal with Woo Chan-soo.

"Sir, why are you trying to make a big deal with such a rookie?"

"Do you see him as a rookie too?"

The man who had been pretending to be a waiter was pouring champagne next to Razak.

He was Razak's right-hand man.

He meticulously managed the company's affairs and had an exceptional eye for people. Whenever a new deal was to be made, he would bring them to the Sky Lounge under the pretext of a meal.

"He seems to be no older than thirty. Judging by the level of conversation, he didn't even seem to have much experience in price negotiations."

"Haha, you're right. He seems to have little experience. But did you see his eyes? They showed that he didn't care at all about a 130,000-dollar contract."

"It's hard to tell if he's brave or just clueless. That much was surprising."

Razak's right-hand man had to agree.

There weren't many fabric merchants who wouldn't bat an eye at a quantity of 200,000 yards or treat 130,000 dollars like pocket change.

"He must think that breaking even on this deal is worth it to start a relationship with me. Would you have had such guts at his age?"

"..."

Razak's right-hand man hesitated to answer.

He might work under Razak, but compared to others, he was always at the top.

The only person better than him was Razak. It had to be that way.

"I asked you a question. Answer me."

"I wouldn't have had such guts."

"If someone like you says that, Mr. Woo must be special. Right?"

"... I can't deny it."

"Give him special treatment. He might really become a white tiger, a tiger that dominates the world."

"Yes, sir."

Razak decided to give special treatment to Woo Chan-soo.

***

The next morning.

Ring. Ring.

"What is it? It's so early."

The phone was ringing even though I hadn't requested a morning call.

It was 7 a.m. on the clock.

"Hello?"

<Mr. Woo, guests are waiting for you in the conference hall. Shall we prepare breakfast separately?>

Prepare breakfast? What?

"What do you mean?"

<Oh, I'm sorry. You prefer a simple breakfast, right? We'll prepare just coffee then.>

"...???"

It was ridiculous, but it was a call from the front desk, and they just hung up after saying they would prepare coffee.

It felt like they were softly urging me to get to the conference hall.

Had Razak already sent his assistant?

Do Indians have a culture of doing things quickly, like Koreans?

I quickly washed up and got dressed before heading to the conference hall.

It wasn't hard to find since the conference hall is always on the floor right above the lobby in any hotel.

"Welcome, Mr. Woo. Everyone is waiting for you."

The hotel staff was waiting for me in front of the elevator.

Clap, clap, clap, clap.

"Welcome, Mr. Woo."

"Nice to meet you. I'm Kumar from Fourth Street."

"I'm Johar from Sixth Street. It's an honor to meet Mr. Razak's guest."

As the hotel staff opened the conference hall door, a crowd of people were waiting for me.

They all mentioned Razak as they greeted me.

"Yes, I'm Woo Chan-soo from Daese Industries. Nice to meet you."

I responded to the applause and shook hands.

I managed my expression, but I was a bit dazed.

Looking around, I saw that six round tables were packed with merchants.

"Are you supplying 200,000 yards to Mr. Razak?"

"Well, roughly."

There was no need for me to give a definite answer.

"Haha, then can we also receive the fabric that Mr. Razak ordered?"

"How much do you need?"

"I need 20,000 yards. Adding 20,000 yards to 200,000 yards wouldn't be too difficult, right?"

Their intentions were obvious.

They believed that if they made clothes with the same fabric as Razak, business couldn't go wrong.

If Razak opened the market, they planned to push in clothes made from the same fabric.

For small-scale clothing merchants, getting the same fabric as Razak was like buying insurance.

"I need 15,000 yards. I've gathered orders from Fourth Street, totaling 67,000 yards."

"I need 18,000! I've gathered orders from Sixth Street, totaling 52,000 yards."

Orders were coming at me from all sides.

Many of them brought collective orders from neighboring merchants. Adding it up roughly, it seemed like 300,000 yards.

"Different colors and small quantities. You don't expect the same price as Mr. Razak for such quantities, do you?"

"Oh, of course not. But please consider our situation a little."

"Even 5% higher than Mr. Razak's price would be grateful."

"Orders less than 10,000 yards will be 85 cents per yard, and orders above that will be 80 cents."

"Gosh! That's too high..."

"The price is something Mr. Razak would agree to, so there will be no negotiation. If you don't want to make a contract, you can leave."

"No, who said we wouldn't? I'll sign first."

Despite the price rising to 80 cents, contracts were being signed in a flurry.

The total of the contracts... 400,000 dollars!

Ah, so that's why the original historical contract was for 400,000 dollars.