81: Chapter 81 Upgrade

During the last week of April, in the brand strategy conference room at Shunyi Foods headquarters, the curtains were drawn tight. Three proposal covers were posted side-by-side on the projection screen, labeled "Quality Certification," "Transparent Factory," and "Celebrity Endorsement," like three cards waiting to be flipped. Marketing Director Lee Jung-hoon stood before the screen, holding a presentation clicker. Kim Soo-jin, the head of the brand planning team, sat on one side of the long table next to a brand consultant recruited from McKinsey named Zheng. In his early forties, Zheng’s hair was meticulously combed, and three PPTs were open on the laptop in front of him. Chairman Wang Shunyi sat in the head seat with only a glass of water before him, no laptop or notebook in sight.

"Chairman, here are the three proposals." Lee Jung-hoon circled the first cover with his clicker. "The Quality Certification strategy. We will apply for all four: ISO 22000, HACCP, US FDA, and korean excellent food certification. The certification logos will be printed on the front of the packaging so consumers can see them at a glance." He switched to the second slide. "The Transparent Factory strategy. We'll hold an open house once a month, inviting consumers, media, and food bloggers to tour the production line. This will be live-streamed on our official website and social media, with panoramic cameras covering everything from raw material storage to finished product dispatch. The third is the Celebrity Endorsement strategy: a full-group endorsement by VIVID, packaged across print, TV, web, and offline events."

Chairman Wang Shunyi picked up his water glass, took a sip, and set it down. "How long is the certification application cycle?"

Kim Soo-jin flipped open the progress chart in front of her. "ISO 22000 takes six to nine months, HACCP three to six months, and the FDA twelve to eighteen months. The korean excellent food certification is the fastest, coming through in two to three months. We can proceed in stages, securing the quickest ones first and printing what we can on the packaging."

"Why is the FDA so slow?"

Consultant Zheng, sitting next to Kim Soo-jin, spoke up. "The FDA's audit cycle for imported food is naturally long. Additionally, our product category is instant noodles, which are classified as processed foods, making the audit stricter than for agricultural products. Twelve months is an optimistic estimate."

Chairman Wang Shunyi didn't ask further. Lee Jung-hoon's clicker switched back to the first proposal, waiting for him to continue.

"Push Strategy One and Strategy Two simultaneously. Start the faster certifications first, and hold the first Transparent Factory open house within a month. Coordinate with the technical department on how to install the live-stream cameras and give me a budget within three days. Celebrity endorsements aren't urgent. VIVID just debuted; wait until they've done a few more rounds of music shows before filming promotional content. If we film now, fans won't even recognize them, and it'll be a waste." He stood up, walked to the whiteboard, and wrote two words with a marker: 'Trust' and 'Premium.' He drew a line under 'Trust.' "Consumers will only be willing to spend more if they trust you. The certifications and the transparent factory are about building that trust." He then drew a line under 'Premium.' "Trust alone isn't enough; we have to turn that trust into money. Create print materials for the endorsements first, film in mid-May, and roll them out in early June. We'll film the TV commercials once they have a hit song."

Lee Jung-hoon, Kim Soo-jin, and Consultant Zheng all took notes.

On Friday of the first week of May, CFO Park Jeong-ho knocked on Chairman Wang Shunyi's office door. He was carrying a thick stack of printouts—a detailed cost analysis for the first quarter. Chairman Wang Shunyi told him to sit, but he didn't dare, remaining standing as he flipped the report to a bookmarked page.

"Chairman, I've broken down the cost structure for the first quarter. Raw material costs have risen fifteen percent year-on-year, primarily due to the imported ingredients used in our low-calorie fire noodles and instant bibimbap. Marketing costs were thirty-two billion, accounting for seven point six percent of sales, compared to five percent in the same period last year. R&D costs were eight point five billion, or two percent, up from one point three percent last year. Sales increased by fifty-two percent, but the net profit margin dropped from twelve point five percent to ten point eight percent."

Chairman Wang Shunyi took the report and flipped through it page by page. He paused when he reached the breakdown of raw material costs. "Is there any way to bring down the prices of imported soy protein and konjac powder?"

"We can't. These two suppliers are already the cheapest among Korean distributors. Unless we source directly from overseas, but our volume isn't large enough yet, so the shipping costs wouldn't be worth it."

"Nongshim's low-calorie noodles use domestic raw materials. How much lower are their costs than ours?"

"Twelve to fifteen percent lower. However, their texture is inferior to ours, which is evident in consumer feedback."

Chairman Wang Shunyi closed the report and leaned back in his chair. "A drop of over one point in profit margin isn't something to be too nervous about. It's the price of our quality strategy, and it's a price we can afford. The scale effect hasn't been fully realized yet. As the overseas market continues to expand in the second half of the year, the profit margin will recover once fixed costs are diluted."

In the second week of May, Kim Soo-jin finalized the certification application materials. The korean excellent food certification required an on-site audit. The auditors spent an entire day at the Shunyi Foods factory, walking from the raw material warehouse to the finished product warehouse, taking photos, recording data, and collecting samples every step of the way. Lee Chang-ho accompanied them throughout; his expression wasn't great, but the resulting audit report was perfect. Starting in June, the 'Korean Excellent Food' logo would be printed on the packaging. Chairman Wang Shunyi told Kim Soo-jin to keep the logo design small and subtle. "Just put it there; there's no need to shout about it. Those who trust you don't need to see it, and those who don't won't believe it even if they do." Despite saying that, he instructed Park Jae-beom to print the certification logo in the corner of the end-cap posters in convenience stores, ensuring it didn't dominate the main visuals.

The first Transparent Factory open house was set for May 20th. Within two hours of the registration notice being sent out, all slots were filled. The attendees included housewives, college students, food bloggers, and even an older man who traveled all the way from Daegu, saying he wanted to see for himself if the factory was clean. Chairman Wang Shunyi didn't host them personally, leaving Lee Chang-ho to lead the tour. The group moved from the raw material warehouse to the production line and then to the quality control room. Lee Chang-ho explained every piece of equipment and every step of the process. A QC technician then took a bag of low-calorie fire noodles fresh off the line and projected a microscopic view onto a large screen. There were no foreign objects on the surface of the noodles, and the cross-section of the noodle block showed very uniform air bubbles.

After the open house ended, a blogger posted that night, saying, "The cleanliness of the Sunyi factory is better than my own kitchen." Someone in the comments questioned if it was an ad, to which the blogger replied, "I signed up myself and didn't receive a cent." That post was shared thousands of times.

At the end of May, Park Min-ji sent a message that wasn't about work. She said, "VIVID's 'FLASH' has entered the top thirty on the Melon real-time chart. It's not easy for a debut song to reach that position." Chairman Wang Shunyi was busy with other things and intended to reply later, but then he forgot. She didn't mention it the next day, and he didn't remember. Later, Kim Young-jun mentioned in a report that VIVID's fan cafe members had surpassed fifty thousand. Three weeks after their debut, their growth speed ranked second among rookies of the same period.

Chairman Wang Shunyi offered neither praise nor criticism. He flipped past the report to the next chapter—the sales forecast for low-calorie fire noodles in June.