Chapter 400: Progress of Rongyao Electronics and the Meeting with Hang Seng Bank
After the wedding, Bai Yujie naturally moved into the Yang family home. Fortunately, the villa they had purchased earlier had enough rooms, so even with several people living under one roof, there were no issues.
Still, when the time was right, it would be worth considering acquiring a villa on Victoria Peak. It wasn't just about status—living there would place Yang Wendong in the heart of Hong Kong's power elite. Security would also be significantly stronger.
Time passed quickly, and soon it was May.
On this particular day, Yang Wendong arrived at North Point, on Hong Kong Island's northern shore—currently the city's largest industrial hub.
"Mr. Yang, welcome to Rongyao Electronics," said Wang Zhiqun, the head of Rongyao, who had been waiting at the entrance well in advance.
"You're too polite," Yang Wendong said with a smile. "The fact that you're standing here probably means I don't come by often enough."
Anyone who's worked in a corporate environment knows: if the boss shows up only occasionally, everyone puts on their best behavior. If he's there every day, things relax.
Wang Zhiqun laughed. "Then Mr. Yang must visit more often in the future."
"No problem. Rongyao Electronics is going to become one of the most important manufacturing branches under Changxing Group," Yang Wendong nodded. "I heard your picture tube and motor factories have gone into production. I came to check things out."
Over the past few years, Changxing Industrial had been the group's manufacturing core. Several of its hot-selling products had created tens of thousands of jobs in Hong Kong and brought Yang Wendong enormous personal wealth, allowing him to invest in other sectors. After all, no matter how capable you are—even with foreknowledge—without capital, you're stuck.
But now, with the dawn of the electronic era and the limited nature of novelty household items, Rongyao Electronics had the potential to outgrow Changxing Industrial. By the 1970s, once video games and computers began to take off, electronics would undoubtedly become the group's central pillar—no question about it.
Wang Zhiqun smiled. "Alright then, let me show you around. Just a heads-up: the CRT assembly area involves some pollution, so please follow the safety team's instructions."
"Of course," Yang Wendong nodded.
In the home appliance industry, most sectors weren't particularly polluting. But televisions were an exception. Whether it was CRTs now or LCDs decades later, their production required large volumes of chemicals. In his previous life, BOE Technology Group in mainland China only selected factory locations near major water sources. And don't forget the future RCA toxic scandal in Taiwan, where the Americans dumped poisonous chemicals into the groundwater to save on environmental costs.
…
For the next hour, Yang Wendong toured the CRT assembly line, television assembly, rice cooker/microwave production, and electric motor workshops with Wang Zhiqun.
He didn't comment much on technical details—that was best left to the professionals. He trusted his people, and they also brought in third-party audits annually.
After the tour, Yang Wendong remarked, "Old Wang, your workshop layout seems a bit cramped."
Wang Zhiqun nodded. "Yes, this was originally designed as a television factory. We anticipated growth back then, so we built it a little large.
But later we added kitchen appliances and fans to the product line, all crammed into this one facility. We didn't expect small appliances to take off so fast, while TV development has been slower. That's why things feel tight now."
"That makes sense," Yang Wendong said. "Our kitchen appliances are mostly novel products. Rice cookers and electric fans offer pricing advantages. And since they're small appliances, if the distribution network is in place, growth comes fast.
TVs are big-ticket items. Families often hesitate before buying one and usually go for established brands. Rongyao has more work to do in this department."
The higher the technical complexity, the harder it is for newcomers to break in—especially if you don't have strong in-house R&D.
In his previous life, after China opened up, it took decades for domestic brands to gradually replace foreign ones. It started with clothing, then basic home appliances, then the so-called "one black two white" (TV, fridge, washing machine). Even with 40 years of effort, cars—the crown jewel of industrial development—only began to show signs of real competitiveness in recent years.
Right now, in the tech sector, they had no inherent advantage. They had to rely on low prices to break into the market. That wasn't easy.
"Yes, Mr. Yang," Wang Zhiqun said. "It'll take time to build up a brand in televisions. Currently, we're working on setting up after-sales service channels. Once that's in place, we'll have the confidence to expand our sales. Fortunately, RCA technology is common, so it's not hard to find people capable of providing service support."
Yang Wendong nodded. "Good. Expand into Southeast Asia as soon as you can. Establish brand awareness. Early-stage brand building is always the slowest, but once you've secured a foothold—and provided the quality holds up—sales will snowball thanks to our price advantage."
Without the internet—and in many places, not even television—brand promotion was painfully difficult. It had to rely on distributors, especially overseas ones.
Even top U.S. and Japanese brands entering Southeast Asia had to depend on local distribution channels. Rongyao, being much smaller, had an even tougher road ahead.
Wang Zhiqun added, "Mr. Yang, I have an idea. Since Changxing Film Company's movies are gaining popularity in Southeast Asia, perhaps we could place some ads in their films. That might help boost our brand."
"Sure, give it a try," Yang Wendong agreed. "But the effect probably won't be strong. The best approach is to wait until Changxing develops real stars in Southeast Asia. Once someone becomes famous, having them endorse our products will be a hundred times more effective."
Wang Zhiqun said, "True. Product marketing works best when paired with celebrity endorsements. I've heard that Japanese electronics and fashion brands broke into Western markets using exactly that strategy."
"Exactly. But for now, focus on the fundamentals," Yang Wendong said. "Even if we struggle with TV sales, if our other small appliances do well, the Rongyao brand will still gain traction. That alone would be a success."
"Understood. From small to big—step by step," Wang Zhiqun nodded.
Yang Wendong continued, "Looking at your kitchen appliances, motor production, and fan lines… the current space is clearly inadequate. Don't you think we should build a separate, large facility just for these? Separate it from the TV production."
"I think that's necessary," Wang Zhiqun said. "Right now, since we control the entire supply chain and benefit from low taxes and labor costs in Hong Kong, our products sell extremely well in Southeast Asia. Prices are far lower than similar Japanese items, and demand is very strong."
"Rice cookers are already exporting over 30,000 units per month, and the distributors are still pushing for more. As for microwave ovens, the volume is even higher—80,000 units shipped last month. Demand in Europe and the U.S. is growing rapidly.
Electric fans? Even more. There's demand in both Southeast Asia and the Western markets. Once summer arrives in the Northern Hemisphere, I wouldn't be surprised if we hit 300,000 to 500,000 units per month. For Westerners, it's normal to replace their fans every year.
With this much demand, the current workshop is bound to become extremely crowded—perhaps even overwhelmed," said Wang Zhiqun seriously.
"Alright," Yang Wendong nodded. "Coordinate with Zheng Zhijie. Have him secure another large plot of industrial land on Hong Kong Island."
Wang Zhiqun hesitated for a moment. "Mr. Yang, I thought you weren't optimistic about the property market?"
Yang Wendong smiled. "I'm not—but compared to your current needs, the real estate investment is negligible. Expanding your production line is the top priority. That applies to Changxing Industrial as well."
If one looked at the historical data, land prices wouldn't bottom out until 1967. But waiting until then would mean wasting not just months but years—an unforgivable delay when manufacturing was booming. In fact, even three months would be too long.
And even though a crash was imminent, over a longer timeline—say, into the early 1970s—buying land now at a so-called "high price" would still be profitable. It might mean earning slightly less, but not at the cost of core industrial growth.
Besides, this was industrial land, usually located in less prime areas, and worth far less than commercial zones. From a real estate perspective, even if profits were reduced, it wasn't significant. Helping Rongyao Electronics break into the Asian market quickly was far more valuable. That would accelerate Changxing's entry into the large appliance sector and help Hong Kong's own manufacturing evolve from low-end to mid- and high-end much faster. It would also set up Yang Wendong for smoother entry into the mainland market once China opened up.
"Alright then, I'll coordinate with Mr. Zheng right away," Wang Zhiqun replied with a smile.
Over the next two weeks, Wang Zhiqun and Zheng Zhijie began scouting locations across Hong Kong Island to establish a new electronic manufacturing base.
By the end of May, the two of them returned to Changxing Tower with a report.
"Mr. Yang," Zheng Zhijie began, "we've checked numerous sites. From both a capital investment and supply chain perspective, continuing to invest in North Point is the most efficient option.
There are still available plots in the southern and western parts of the island, but they're too remote. Infrastructure like water, electricity, and transportation would need to be built from scratch. Most importantly, there aren't enough educated workers in those areas. You'd be surprised, but some of the towns on the Kowloon Peninsula have more qualified labor than remote parts of Hong Kong Island."
"Mm. People are the most important resource," Yang Wendong nodded. "But North Point has been developing for over twenty years. I imagine there's not much free land left?"
In industries requiring even modest technical skills, the quality of your workers could define your success. It wasn't just about management or engineering—it applied to everyone on the floor.
Give two factories the same managers and middle management. If one employs illiterate laborers and the other hires workers with a middle school education, the performance gap over time would be massive.
In his previous life, mainland China had become the world's factory precisely because its workers were sufficiently educated. Even line workers often had a high school or technical diploma. Supervisors might hold a junior college or even bachelor's degree—an unimaginable standard in most other countries.
Rongyao Electronics was a technology-based firm. Even though their current products weren't too complex, producing something like an electric fan was still more efficient and reliable with literate workers. At the very least, they could read instructions and follow safety protocols.
Zheng Zhijie replied, "You're right. There's very little free land left in North Point. But there are plenty of textile and toy factories here that are planning to move to Kowloon because operating costs have gotten too high.
I've done some preliminary research—if enough of these companies leave, we can buy up their factory spaces, demolish them, and build a consolidated facility for Rongyao."
"That works," Yang Wendong said with a nod.
Wang Zhiqun interjected, "But doing that would raise our costs significantly."
"That's fine," Yang Wendong said, waving off the concern. "Industrial land is still relatively affordable, and we can phase the purchases. Acquire a small plot first to meet your immediate needs.
As demand increases, we'll buy more land later. If industrial demand is rising and land prices are falling, then the best strategy is to buy only what we need now and pick up more when prices hit rock bottom."
"Understood. I'll take care of it," Zheng Zhijie said. Then he added, "There's something else. Ho Sin Hang from Hang Seng Bank reached out to us. He's heard about Rongyao's expansion plans and said he's willing to support us with a loan."
"That's fine, as long as the interest rate is reasonable," Yang Wendong replied. "When it comes to industrial investments within Hong Kong, we should try to work with Chinese-owned banks as much as possible."
That was one of Changxing Group's financial principles—work with British banks like HSBC or Standard Chartered for international trade, and stick with local Chinese banks for domestic operations. Unless it was a special transaction, this rule always applied.
"Understood," both Zheng Zhijie and Wang Zhiqun said.
Even acquiring industrial land in North Point wouldn't cost too much. Yang Wendong wasn't concerned with the real estate value. What mattered to him was the development of Rongyao Electronics. Real estate was just a number—whether he earned a bit more or less didn't change the big picture.
The larger and stronger a manufacturing enterprise became, the more influence it wielded. After all, even the British government was now inviting Yang Wendong to invest in the UK—a treatment Hong Kong's real estate companies could only dream of.
Time passed quickly, and by June, Zheng Zhijie had successfully acquired several plots totaling 80,000 square feet (around 8,000 square meters). The new factory was designed to be a modular, small-scale assembly plant. Construction began immediately—running 24/7, with completion expected in just over a month.
Since the requirements were minimal—shelter from wind and rain, and access to water and electricity—it didn't take much to get started.
Once everything was confirmed and construction was underway, Yang Wendong could breathe easy. His focus for the next few years would remain on manufacturing. As for real estate—he could revisit that in 1967.
June 6, a staff member approached Yang Wendong. "Mr. Yang, Ho Sin Hang from Hang Seng Bank would like to schedule a meeting with you."
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