Chapter 470: An Opportunity to Enter the Japanese Market
After the three entered Ma Shimin's office and took their seats, Lin Haoran curiously asked, "Mr. Hiroshi Yamauchi, what brings you here?"
In his view, Hongkong Land Group and Nintendo were companies from completely different industries, so Yamauchi's visit felt somewhat mismatched.
Moreover, as far as he knew, Nintendo products were already being sold in Hong Kong.
Before Yamauchi could respond, Ma Shimin proactively explained, "Boss, let me give you an introduction. From your earlier remarks, it's obvious you already know something about Nintendo. It's a powerful video game company and currently the world's second-largest video game enterprise, second only to the industry giant Atari from the United States.
"Although they rank second, the gap between them and Atari is still quite considerable. Last year, Nintendo launched a handheld game console called Game & Watch. In less than a year, it sold more than five million units in Japan alone, an astonishing achievement that gave Nintendo hope of surpassing Atari.
"However, in international markets—especially compared to Atari—Nintendo is still somewhat weaker. In particular, sales in Hong Kong and Southeast Asia have not met expectations.
"This time, Mr. Hiroshi Yamauchi personally came to Hong Kong not to seek cooperation with Hongkong Land Group itself, but rather to meet you. What they value is the enormous influence your industries possess throughout Hong Kong and even Southeast Asia.
"Your business empire now includes numerous well-known retail channels, such as Wellcome Supermarkets under Dairy International and Fortress Electronics and convenience stores under the Hongkong Electric Group. In practice, you already control the broadest sales network in Hong Kong, and you even hold a certain position in Southeast Asia.
"Hong Kong was Mr. Yamauchi's first stop after leaving Japan. He hopes that through cooperation with us, and by relying on your powerful distribution network, Nintendo can further increase the sales of its products.
"Originally, Mr. Yamauchi intended to cooperate with Jardine Matheson when he came to Hong Kong. However, most of Jardine's sales channels in Hong Kong have already been absorbed by us, so he decided to seek cooperation with us instead.
"Next, he will also travel to Singapore, Manila, Kuala Lumpur, Bangkok, and other places in search of more powerful business partners, hoping to further increase product sales."
After hearing this, Lin Haoran suddenly understood.
However, a trace of doubt surfaced in his mind.
"If I remember correctly, isn't Atari going to run into trouble very soon? Is Nintendo really still being suppressed by a game console company that's about to fall into crisis?"
Lin Haoran was not deeply familiar with the gaming industry, so he did not fully understand the competitive situation between Nintendo and Atari.
As for Nintendo's status during the 1980s and 1990s, his knowledge mostly came from fragmented bits of information he had read online in his previous life.
"Mr. Lin, I came here this time with complete sincerity. To facilitate this cooperation, Nintendo is offering extremely generous terms."
Yamauchi continued sincerely, "As long as ten thousand units of our products are sold in the Hong Kong market, your commission will be calculated at 20% of the selling price. If sales reach two hundred thousand units, the commission will rise to 22%. At three hundred thousand units, it will reach 24%, with a maximum of up to 30%!
"Although Hong Kong is a small market, its consumer potential is enormous, with many consumers possessing strong purchasing power. Therefore, Nintendo has always attached great importance to the Hong Kong market, and we hope to achieve great success together with you.
"In addition, the sales under your businesses in Southeast Asia can also follow this contract arrangement, though each market would be calculated separately."
Hearing this, Lin Haoran inwardly scoffed.
There were certainly many people in Hong Kong who could afford it.
However, among Hong Kong's population of five million, the age group interested in game consoles was mainly concentrated between ten and thirty years old.
That demographic likely totaled only a little over one million people.
And among them, if even one-tenth bought a game console, that would already be an astonishing figure.
Therefore, reaching sales of one hundred thousand units would already be extraordinary, let alone two hundred thousand or three hundred thousand units.
And at present, a single game console cost several hundred Hong Kong dollars.
Even if two hundred thousand units could be sold in Hong Kong, Lin Haoran clearly understood that according to Nintendo's proposed commission structure, the profits his companies would receive would not actually be particularly impressive.
Furthermore, while his companies' distribution channels in Southeast Asia were decent, the local distribution networks there were also highly competitive, and his channels did not possess any overwhelming advantage.
Thus, Lin Haoran did not hold especially high expectations for the potential sales this cooperation might bring.
However, he could keenly perceive that Yamauchi's true purpose in visiting Hong Kong and Southeast Asia was to expand broader distribution channels and increase Nintendo's product sales, thereby gaining a stronger position in its competition with Atari.
Seeing Lin Haoran remain silent, Yamauchi slowly took out a game console from his briefcase and gently placed it in front of him.
"Mr. Lin, this is Nintendo's latest Game & Watch. In just a few months after launching in the Japanese market, it achieved tremendous success, which made me deeply realize its market potential.
"Certainly, from your personal perspective, this may not seem like a massive cooperation project, but for Nintendo, it is extremely meaningful. We believe that through this partnership, both sides can obtain long-term development opportunities.
"As long as Mr. Lin is willing to give this cooperation a chance, Nintendo will always remember it. I confidently predict that Nintendo will become the leader of the global video game industry in the near future.
"And Mr. Lin, you will forever be our treasured partner and friend. We look forward to witnessing and participating in this historic process together with you."
The video game industry was no longer a niche business.
In North America alone, annual revenue had already reached nearly three billion U.S. dollars. Combined with the European and Asian markets, it had already become an industry approaching ten billion dollars in scale.
And Nintendo was already the number two company in the industry, so it was no surprise they wanted to seize the top position.
Lin Haoran picked up the Game & Watch from the table and carefully examined the small yet exquisite handheld console.
He lightly pressed the buttons and watched the game graphics flicker across the screen.
This already possessed the prototype of future modern handheld gaming devices.
Smiling slightly, he set the console back down on the table. Instead of answering Yamauchi's question, he asked in return, "Mr. Hiroshi Yamauchi, may I ask whether Nintendo is a publicly listed company?"
Lin Haoran's question immediately caught Yamauchi off guard.
"What does Mr. Lin mean by asking this? Nintendo was listed on the Tokyo Stock Exchange in 1962," Yamauchi replied, unable to understand why Lin Haoran would ask such a question.
Lin Haoran nodded and continued, "Then as Nintendo's president, Mr. Yamauchi, have you ever considered financing Nintendo? I'm very optimistic about your company's future!"
"Uh, to be honest, Mr. Lin, we currently do not lack cash at all, so we have no plans for financing. If Mr. Lin wishes to acquire shares, you may do so through the stock market," Yamauchi replied with a shake of his head.
The Yamauchi family's control over Nintendo was extremely solid, so they were not worried about anyone threatening their authority.
Therefore, Yamauchi could generously allow Lin Haoran to accumulate shares through the stock market.
"No, no, Mr. Yamauchi, I think you misunderstand me. I don't mean financing Nintendo in the form of capital, but rather in the form of technology!" Lin Haoran laughed heartily.
Lin Haoran's understanding of the video game field was indeed limited, confined mainly to the gameplay of several classic games.
And in Hong Kong, talent within the gaming industry was scarce, which also made him unwilling to personally enter the field.
However, he certainly did not mind investing in a future gaming giant like Nintendo and sharing in its future growth dividends.
Additionally, last year, the major companies under his control had all performed very well financially.
Now, their financial reports were about to be released one after another.
Once those reports came out, he would know exactly how much disposable capital he possessed.
Although he still did not know the precise figure, it certainly would not be small.
In fact, Lin Haoran had already planned to enter the Japanese market this year.
After all, he clearly knew how wildly prosperous Japan's market would become during the 1980s.
Entering the Japanese market at this time would absolutely be an excellent opportunity.
As far as he knew, by the late 1980s, among the top ten financial institutions in the world by market value, eight were from Japan.
That alone demonstrated just how crazy Japan's economy had become during the 1980s.
Therefore, he definitely could not miss the Japanese market.
As long as he withdrew before Japan's economic crisis arrived, he could make an enormous fortune there during this period.
However, the Japanese market was highly exclusive toward outsiders. If he simply tried to enter directly, it would certainly be very difficult.
Thus, he absolutely needed to establish a certain network of connections within Japan.
And Nintendo's influence within Japan was not small. If his cooperation with Nintendo went smoothly, and he used that opportunity to enter the Japanese market, then acquiring shares in Nintendo would indeed be an excellent idea.
Lin Haoran's thoughts sounded quite novel to Yamauchi, causing him to freeze slightly before revealing an interested expression.
"Financing in the form of technology? Mr. Lin, could you explain in more detail what you mean?"
He truly could not understand what kind of technology Lin Haoran possessed.
After all, in his eyes, Lin Haoran was merely an outsider to the gaming industry.
No matter how he thought about it, he simply could not understand what Lin Haoran meant by those words.
In the field of gaming, what kind of technology could an outsider possibly have? Wasn't that a joke?
However, Lin Haoran's status was rather special, so naturally he could not say anything disrespectful outright.
Thus, he could only continue asking tactfully, wanting to see what this famous billionaire would say next.
(End of Chapter)