Episode 149
With a simple inauguration ceremony, I officially became the chairman of Chunha Group, and I could feel the weight of my new title and position.
I had gone from a wealthy junkyard owner to the chairman of a group that controlled Korea’s second-largest electronics company.
People’s gazes had changed.
“Good morning, Chairman!”
“Good morning to you too.”
The Daehoo Electronics employees bowed and scraped before me.
They had all been above me in the hierarchy, but now their livelihoods depended on my whims.
“Hmm?”
I spotted someone, approached him with a bright smile, and said, “Well, well, if it isn’t Assistant Manager Noh.”
Noh Byung-gu, who had been trying to slip away, flinched and bowed deeply. “G-good morning, Chairman!”
Daehoo Electronics, with its massive scale, was one of our major sources of electronic scrap.
And Noh Byung-gu was the one who had negotiated prices and schedules with us, the one who had received countless kickbacks.
“We haven’t seen much of each other lately. I’ve been busy.”
“O-of course, sir! It’s only natural!”
I put my arm around his shoulder, feigning familiarity. “Don’t be so formal. We used to drink together, didn’t we?”
“Th-that…”
“We had some good times. Remember that time you postponed the circuit board pickup? My truck was idle for an entire day. Good times.”
His face paled as I brought up the incident.
“I-I apologize for that, sir! Something came up, and I had to postpone it!”
“Of course, of course. You were busy, I understand.” I nodded repeatedly. “But a one-hour notice was a bit rude, wasn’t it?”
It had been when I had just secured the Naoshima Smelter contract and started my foray into the corporate electronic scrap market.
I had endured countless humiliations, and my truck was already on its way when he unilaterally postponed the pickup.
“And remember when you suddenly switched to a bidding system?”
I reminded him of the bidding war, instigated by the collusion among the scrap companies.
His eyes wavered. “I-I’m sorry, sir.”
“There’s no need to apologize. You were just doing your job for the company.” I smiled brightly. “But why did you take all those bribes and then screw me over?”
He started trembling as I turned the tables on him, reminding him of how he had abused his position.
“Th-that’s…”
“You should have earned your bribes. Isn’t that how business works? Why did you do it? I’m curious.”
I wasn’t genuinely curious. He had obviously taken the bribes because someone had offered him more. I was just enjoying the reversal of our roles, the shift in power dynamics.
“I-I’m truly sorry, sir.”
“Not ‘sorry,’ tell me the reason.”
I smiled, watching him sweat, speechless.
That was enough.
I patted him on the back. “Well, what’s done is done. We’re colleagues now. Let’s work well together.”
Colleagues.
I was the chairman, and he was a lowly assistant manager.
“I-I’ll work hard, sir!”
“I’m counting on you to support Chunha Trading. Understood?”
“Absolutely! Chunha Trading all the way!”
“And you’re not still expecting those kickbacks, are you?”
He shook his head vigorously. “No, sir! Absolutely not!”
I had made an observation while restructuring Daehoo Electronics.
It was Korea’s second-largest electronics company, but it lacked a unique identity. They had some brand recognition and a strong presence in home appliances, but they weren’t dominant in any specific area.
Always second best. A perpetual runner-up. And their product line-up reflected that.
“They just copied everything Saseong made.”
If Saseong made VCRs, Daehoo made VCRs. If Saseong made mobile phones, Daehoo made mobile phones. From small radios to large refrigerators, they had a wide range of products, but they were all mediocre.
“I didn’t acquire this company with a grand plan, but I’m not satisfied with this.”
Chunha Trading’s success was built on being a first mover and dominating niche markets. But Daehoo Electronics was just a follower, always playing catch-up. They needed a killer product, something that could beat the competition, but they had nothing.
“Any findings?” I asked Im Jong-geun, who had been promoted to managing director.
I had tasked him with identifying promising projects within Daehoo Electronics after dismissing the executives.
“Nothing noteworthy, except they were preparing to develop a color phone.”
“A color phone?”
“Yes.”
A mobile phone with a color screen.
“That’s not bad. Tell them to continue with the development.”
“Yes, sir.”
“By the way, Managing Director Im, what’s your vision for Daehoo Electronics’ future?”
It was a vague, almost cliché, question you might hear in a job interview, but it was also the most crucial question at this point.
Daehoo Electronics was a new company now, having undergone a massive restructuring. Did they need a new, innovative approach?
He said, sweating nervously, “W-well… we should focus on improving product quality, developing new technologies for a brighter future…”
“Yes, yes, I understand.”
A cliché question had elicited a cliché answer.
I hadn’t rehired him for his brilliant ideas. He was just a middle manager, a liaison between me and the employees.
“Proceed with that plan, and report any unusual developments.”
“Yes, sir.”
After he left, I was lost in thought.
“There must be a way…”
Mobile phones, radios, microwave ovens… Many products flashed through my mind, but nothing sparked my interest.
“Screw it. I’m not a researcher. I’m not going to have a breakthrough just by thinking about it.”
Research was for researchers, management was for managers.
“I should focus on what I’m good at.”
Recycling as a junkyard owner, buying and selling used goods, and distribution through the department store.
But I couldn’t see a connection between those skills and manufacturing.
“I’m good at selling other people’s products…”
Other people’s products?
“Wait a minute…”
The least traded items in the secondhand market were large appliances like refrigerators and washing machines.
People used them for a long time, and their size made private transactions impractical. They were usually discarded when people bought new ones.
And those discarded appliances were either dismantled for scrap or sold to China through us.
“We could buy back old appliances when people buy new ones. That could be a good marketing strategy.”
It would be more efficient if the deliverymen could collect the old appliances when installing new ones. And it would be easy to repair and resell Daehoo Electronics’ products.
“Hmm… if they offer to remove my old appliance and even give me money for it, I’ll definitely buy a Daehoo product.”
And it would be the first collaboration between our subsidiaries, which was a plus. The more I thought about it, the better it sounded. I started fleshing out the plan.
“Retailers sell new appliances and collect old ones. We collect them from the retailers, repair and resell the ones in good condition, and export the rest to China. And if we need parts, we can cannibalize them, just like we did with the old computers. The profit margin wouldn’t be bad.”
It wouldn’t cost much, it would be like offering a discount to consumers, and Chunha Trading could easily collect used appliances. It was a win-win situation.
“This is good. It’s an extension of our existing business. Maximum efficiency with minimal effort. Let’s do it. We have nothing to lose.”
“This thing is acting up again.”
Kim Mal-ja, a housewife, sighed as her washing machine stopped working, making a rattling noise.
“Well, it’s old.”
She had bought it as a wedding gift, so it was older than her eldest son.
“Should I buy a new one? It’ll be a hassle to dispose of this one.”
She felt a pang of anxiety at the thought of spending money in these difficult economic times, but she couldn’t live without a washing machine.
“Where are the flyers?”
She started comparing the prices and features of different washing machines, like a thrifty housewife.
“These are so expensive!”
The flyers advertised the latest models and their new features, but all she cared about was the price.
They were all hundreds of thousands of won, some even over a million won.
She picked up a flyer for Daehoo Electronics, her face falling. “Daehoo? I don’t know…”
Even a housewife like her knew that Daehoo had gone bankrupt.
Their prices were slightly lower than other brands, but she was hesitant to buy a product from a failed company.
She was about to discard the flyer when she noticed something she hadn’t seen on the other flyers. “What’s this? A trade-in program?”
She read the details and said in surprise, “They’ll take my old appliance and give me money for it?”
According to the flyer, if you bought a new appliance, the deliverymen would collect your old appliance and give you a trade-in value based on its condition and age.
And they guaranteed a minimum of 50,000 won for a broken washing machine.
“They’ll even buy a broken one? Is this a service?”
Even a broken appliance had value, and it wasn’t a loss for the company, but she saw it as a service.
She couldn’t imagine what they would do with a broken appliance. This simple difference in perspective was one of the reasons Park Sol had initially rejected the idea.
She couldn’t help but be tempted.
It was already cheaper than other brands, and with the 50,000 won trade-in value, it was an even better deal.
“And if it happens to be working when they come to collect it, I might get over 100,000 won…”
With the trade-in value, it was at least 10-20% cheaper than other brands. For someone like her, who compared prices down to the last 10 won, it was a no-brainer.
“I thought Daehoo went bankrupt? Maybe they’re doing better now, since they’re offering trade-in values…”
She started viewing Daehoo in a more positive light.
“Washing machines don’t break down that easily anyway, do they? And I don’t really need the warranty. As long as it washes clothes, it’s fine. Hmm, I’ll go to the store and take a look.”