42: Chapter 42 New Opponent

The New Year holiday had just passed, and Seoul was still huddled in the cold of late winter. The cherry trees on the streets were bare, their branches poking at the grey-white sky like iron wires.

When Chairman Wang Shunyi arrived at the company on January 3rd, Kim Tae-min was at the entrance tearing off the calendar. He hadn't torn it off cleanly, leaving a strip of red paper edge, which looked a bit sloppy.

"President, Happy New Year." Kim Tae-min bowed.

"Happy New Year." Chairman Wang Shunyi nodded and walked toward his office. Before his chair had even warmed up, the door was pushed open. Zhang Junhao entered faster than usual, holding a stack of printed papers, his expression not looking good.

"Sunyi, something happened."

"What is it?"

"Shunyi Foods issued an announcement." Zhang Junhao handed over the paper. "A nationwide price reduction of 30% on all instant noodle products for three months. They say they want to let more consumers enjoy affordable and high-quality convenience food."

Chairman Wang Shunyi took the paper and scanned it. Jins Foods, ranked twelfth, with an annual sales volume of two trillion. He frowned, put the paper on the desk, and said nothing.

"Why are they suddenly doing this?" he asked.

"Not sure." Zhang Junhao pulled up a chair and sat down. "But Jins Foods's growth hasn't been good in the last two years, and their market share is being squeezed by big brands like Nongshim and Samyang. Kim Dong-hyun might be trying to win back the market through a price war."

Chairman Wang Shunyi leaned back in his chair, staring at the ceiling. Kim Dong-hyun, Vice President of the Food Industry Association, had been in the food business for over twenty years; he was an old hand. He wouldn't make such a move on a whim.

"Meeting this morning." Chairman Wang Shunyi stood up, walked to the whiteboard, and wrote a few words: "Jins Foods - 30% Price Reduction."

The meeting started at ten o'clock. Park Min-ji, Cha In-pyo, Jung Soo-yeon, and Li Dongxu all came, and there were nearly twenty people in the conference room. Zhang Junhao projected the Jins Foods announcement onto the white wall; white background with black text, it looked like an obituary.

"Let's hear everyone's thoughts." Chairman Wang Shunyi sat at one end of the table, spinning a pen in his hand.

Park Min-ji spoke first: "A 30% price reduction—if we follow suit, our profits will be gone. If we don't, price-sensitive customers will run off."

"How many will run off?" Chairman Wang Shunyi asked.

"Hard to say. But our core customers—those who care about quality and recognize the brand—won't switch just because of a few hundred won. What we should worry about are the fringe customers; they go wherever it's cheaper and were never stable to begin with."

Zhang Junhao took over: "Jins Foods's products can't compare to ours in terms of quality. Their instant noodle cakes are crumbly, and the seasoning flavor is weak; consumers have complained about it online before. A price reduction might pull away some people, but it won't pull away everyone."

Chairman Wang Shunyi put down the pen. "Then that's it. We won't follow. We are not lowering prices."

The conference room went quiet for a moment. Not following the price war meant that sales might drop in the short term.

"But we can't just sit idly by." He stood up, walked to the whiteboard, and picked up a marker. "Three things."

"First, strengthen our quality promotion. On the packaging and in advertisements, clearly write out our ingredients, craftsmanship, and testing standards. Let consumers know why our products are worth this price."

"Second, hold factory open days. Invite consumers to visit and see our production lines and quality inspection processes with their own eyes. Hearing it a hundred times is not as good as seeing it once."

"Third, continue to push new products. Use new products to prove our innovation capabilities. Jins Foods drops prices, we release new items. Two paths; let's see which one consumers choose."

He finished writing and turned around.

"Minji, you are in charge of promotion and the open days. Brother Jun-ho, you arrange the factory side; the production line needs to be cleaned up, and the visitor route needs to be well-designed. In-pyo, new product R&D cannot stop; we need to release at least one next month."

The three of them nodded respectively.

After the meeting, Park Min-ji stayed behind and sat across from him.

"President, Jins Foods's move this time is significant. A 30% price reduction means they will also take a hit. I've heard of this Kim Dong-hyun; he does things ruthlessly but doesn't really consider the consequences. He probably won't be able to hold out for long."

"How do you know?"

"With a two-trillion scale, the profit margin wasn't high to begin with. A 30% price reduction will cause a huge loss in his monthly cash flow. Three months? I doubt he can last two."

Chairman Wang Shunyi looked at her. "Then do you think we should take any initiative to do something?"

"Do what we should do. Quality, open days, new products—these are enough. Don't get into a war of words with him, and don't bicker in advertisements. The more anxious he is, the more steady we must be."

Chairman Wang Shunyi nodded.

Over the next week, Jins Foods's price war unfolded completely. GS25, CU, and Homeplus—all channels lowered prices simultaneously. Large yellow labels were stuck on the shelves—"30% Price Reduction"—looking like a glaring bright yellow from afar. Chairman Wang Shunyi passed by a GS25 and went in to take a look. Indeed, there were people buying, but most were middle-aged and elderly people, stuffing their baskets; they bought five or six packs at a time. There weren't many young people; occasionally, a few would stand in front of the shelf hesitating, but in the end, they still took Sunyi's fire chicken noodles and left.

Park Min-ji's side moved quickly as well. She redesigned the product packaging and added a "Quality Traceability" section on the back—ingredient origins, production craftsmanship, and inspection reports were all printed on it. The text wasn't large, but the layout was very clean, making it reassuring to look at. At the same time, she posted a registration link for the "Factory Open Day" on social media, and over three hundred people signed up in less than three days.

The first open day was on the first Saturday of February. Before dawn, Chairman Wang Shunyi had already arrived at the factory. Park Jung-hoon had already cleaned the workshop until it was spotless; the floor had been mopped three times, and the machines were polished until they gleamed. The visitor route started from the raw material warehouse, passing through the production line, packaging line, and inspection room, finally ending at the tasting area. Each point had a guide assigned, all of whom were veteran employees from the production line; they didn't talk much, but they were genuine.

The first batch of visitors arrived at nine o'clock. About twenty people, including housewives, university students, a restaurant owner, and a food blogger carrying a camera. Chairman Wang Shunyi led the team himself, wearing a white lab coat, a hat, and a mask, waiting at the entrance of the raw material warehouse.

"Hello everyone, I am Chairman Wang Shunyi, the President of Shunyi Foods. Today, I will take you to see our factory."

He pushed open the warehouse door, and a dry scent of grain rushed toward them. Row upon row of shelves were stacked with neatly arranged raw materials—flour, konjac flour, chili powder, and dehydrated vegetables. In front of each pile of raw materials hung a label, stating the origin, storage date, and inspection results.

"This is our konjac flour, imported from Yunnan, China. When each batch of goods arrives, our quality inspectors take samples for testing—gel content, moisture, microbial indicators; if one item is unqualified, it is returned." He picked up a small bag of samples and held it up for everyone to see. "Our konjac noodles have only 150 calories per serving, and the texture is not much different from regular noodles. You can touch it and see."

The visitors leaned in to touch it; some nodded, and some whispered, "It really is quite fine."

Over at the production line, Park Jung-hoon explained it himself. He stood next to line number one, pointing at the noodle cakes on the conveyor belt and said, "This line has a daily capacity of 500,000 packs, with spot checks every fifteen minutes. The thickness of the noodle cake, moisture content, and frying time all have standards. Anything outside the standard range means the whole batch is scrapped."

A university student raised his hand and asked, "Then how do you ensure that the standards aren't changed by someone who is lazy?"

Park Jung-hoon looked at him and said, "The inspection data is uploaded directly to the system; it cannot be changed. Moreover, every batch of products has a serial number; we can check what day it was produced, who was on duty, and who inspected it."

Finally, they reached the tasting area. On the table was freshly cooked Busan fish cake soup, steaming hot; the savory scent of fish cake mixed with the fragrance of green onions filled the room. Chairman Wang Shunyi served the soup to everyone himself, a small bowl for each person.

That food blogger scooped a spoonful, blew on it, and took a sip; his eyes lit up. "The soup base is very rich, and the fish cake is chewy; it doesn't taste like an instant product."

"Our fish cakes are delivered directly from Busan via cold chain, with no added preservatives," Chairman Wang Shunyi said. "The shelf life is short, but the texture is good."

When the tour ended, the blogger grabbed Chairman Wang Shunyi for a photo. After going back, he posted a thread titled "A One-Day Tour of Shunyi Foods Factory, Explained by the President Himself; This Bowl of Fish Cake Soup Was Worth It." Less than two hours after the post was published, it had over two thousand likes. In the comments section, some said, "So there is a reason why it's expensive," some said, "I'll sign up next time," and others tagged friends saying, "Look at their production standards."

A total of four open days were held, and each one was packed. The buzz on social media gradually picked up, and the news about Jins Foods's price reduction was pushed down.

Over at Kim Dong-hyun's side, things were not going well.

In the first week of the price reduction, sales rose by 15%. The second week, it rose by 8%. The third week, it only rose by 3%. The marginal effect of the price reduction was rapidly diminishing. Worse, Jins Foods's finance department did the math—a 30% price reduction cut their gross profit directly in half, and their monthly cash flow was rapidly shrinking.

In Kim Dong-hyun's office, the atmosphere was oppressive. The marketing manager stood in front of the desk with his head down, holding the weekly sales report, not daring to look up.

"Why is the effect getting worse and worse?" Kim Dong-hyun's voice was not loud, but it was very low.

"Chairman, the price-sensitive consumers bought everything in the first week. The remaining consumers are not that sensitive to price; they value brand and quality more. Shunyi Foods recently held a factory open day, and the buzz on social media is very high; many people are discussing their product quality..."

"Product quality?" Kim Dong-hyun sneered. "No matter how good their products are, can they be good enough to be 30% more expensive than ours?"

The marketing manager opened his mouth, then closed it. He didn't dare tell the truth—Jins Foods's products were indeed not as good as Shunyi's, and even with the price reduction, they still weren't.

"Hold on for another month." Kim Dong-hyun waved his hand. "If the effect is still not obvious, then stop."

"Yes."

At the end of February, Chairman Wang Shunyi received some internal news about Jins Foods—Kim Dong-hyun had already asked the finance department to calculate the cost of stopping the price war. Chairman Wang Shunyi told the news to Zhang Junhao and Park Min-ji.

"He can't hold out anymore," Zhang Junhao said.

"As expected." Park Min-ji picked up her coffee and took a sip. "A 30% price reduction—no one can hold out for too long."

Chairman Wang Shunyi said nothing. He stood by the window, looking at the grey sky outside. Kim Dong-hyun was not Park Chan-hyeok; Park Chan-hyeok was someone who had nothing to lose, while Kim Dong-hyun was someone wearing shoes, reluctant to kick them off. A price war is a sure-kill tactic for small businesses, but for companies of a certain scale, it is mutual destruction. Kim Dong-hyun thought he was the hunter, but in reality, he had put himself into the trap as well.

"President," Park Min-ji stood up, "What do we do next?"

"Continue doing what we should do." Chairman Wang Shunyi turned around. "New products will launch as planned, and open days will continue. After Jins Foods stops the price reduction, their brand image will be damaged, and consumer trust will also be discounted. What we need to do is—make sure those lost fringe customers don't come back."

He walked back to the desk, opened his notebook, and wrote four words on a new page—"Busan Fish Cake"—then drew a line underneath.