Steal the enemy's base at the start and build a technological empire.

Chapter 152 The Expansion of Internet Cafes

At 3 PM, at the Xinghuo Internet Cafe flagship store at the south gate of Shandong University.

In his office on the second floor, Zhao Weiguo was checking the accounts. More than a dozen ledgers were spread out on the table, and the calculator was clicking away.

He looked up when he heard the knocking.

"Brother Yun!" He stood up. "When did you get back?"

"I just got off the plane this morning." Ling Yun walked in, looked around, and saw that the office was small but very clean. Photos of various internet cafes were hanging on the wall, and the upcoming schedule was written on the whiteboard.

Zhao Hu stood outside the door.

"Sit down." Zhao Weiguo pulled over a chair. "I'll pour you some tea."

"Hold on." Ling Yun sat down. "Tell me the situation."

Zhao Weiguo took out a folder.

"Let me start with the numbers. There are five Xinghuo Internet Cafes in Jinan. The one at Shandong University is the main store, and the other four are located at Shandong Normal University, Shandong Provincial Sports Center, Quancheng Square, and Honglou. Each one has between sixty and one hundred computers."

"All five are located in Qingdao, near the university town."

"Two locations in Shanghai are currently under renovation, near Fudan University and Shanghai Jiao Tong University, and are expected to open next month."

"Two locations in Beijing, one in Zhongguancun and the other in Wudaokou, are also under renovation and will open in September."

Ling Yun nodded.

"How's the operation?"

"In Jinan, there are five stores with an average occupancy rate of 85%, and the combined monthly net profit is about 400,000 yuan. In Qingdao, there are five stores that have just opened, with an occupancy rate of about 70%, which is expected to reach 80% next month."

"Where are the personnel?"

"Each store is equipped with: one store manager, two network administrators, two receptionists, and one cleaner. There are a total of 45 people in Jinan, 50 in Qingdao, and 15 each in Shanghai and Beijing on standby."

"Salary level?"

"The store manager earns 1,500 a month, the network administrator 1,200, the receptionist 1,000, and the cleaner 800."

Lingyun did the math.

"The monthly labor costs alone amount to over ten thousand yuan."

"But the profits are even higher." Zhao Weiguo flipped to the profit statement. "In the first half of July, the net profit of the five stores in Jinan was already 250,000 yuan. Computers cost three to five yuan per hour, and the profit margin for beverages and snacks is over 50%. There are also accumulated funds from membership top-ups."

"Not bad." Ling Yun picked up the ledger and looked at it. "You just said you were providing internet cafe solutions to others?"

"Yes." Zhao Weiguo's eyes lit up. "I need to explain this in detail."

He opened another folder.

"Starting in March, we started receiving inquiries from people who wanted to open internet cafes but didn't know how. We provided a complete solution: site selection advice, interior design, computer configuration, management system, and staff training."

"How much does it cost?"

"There are two types," Zhao Weiguo said. "One is simple consultation, which costs 10,000 yuan. We provide a solution, and they implement it themselves. The other is franchising, where they use the 'Spark Internet Cafe' brand, pay an annual management fee of 20,000 yuan, and we send people to help them operate the business. Their salaries are included in the internet cafe's operating costs."

"Anyone interested in franchising?"

"Yes," Zhao Weiguo said, pointing to a table. "Currently, we have 23 franchisees. Seventeen are within the province, and six are outside the province. Each franchise costs 20,000 yuan per year, which is 460,000 yuan in management fees. Moreover, we can make a profit by purchasing computer components centrally."

Ling Yun carefully examined the table.

Franchise stores are located in Yantai, Weihai, Weifang, Zibo, Linyi, Dezhou... and as far as Zhengzhou and Shijiazhuang.

"How are these stores doing?"

"They're all doing well," Zhao Weiguo said. "We use a unified management system that allows us to remotely monitor the occupancy rate, revenue, and inventory of each store, and make timely adjustments if there are any problems. Last month, the total profit of our 23 franchise stores was about 800,000 yuan, and we took 5% as a service fee, which amounted to another 40,000 yuan."

"Service fee?"

"That's right," Zhao Weiguo explained. "In addition to the fixed management fee, we also take a cut of the profits. Franchisees are willing to do this because we can really help them make money. Some stores only made 20,000 yuan a month when they were running their own businesses, but after our adjustments, they can make 40,000 yuan."

Ling Yun looked at Zhao Weiguo and smiled.

"Wei Guo, you've finally figured it out."

Zhao Weiguo scratched his head sheepishly.

"I learned it all from you. You once said that selling services is worse than selling products, and selling standards is worse than selling services."

"I remember it very clearly."

"Of course." Zhao Weiguo became serious. "Brother Yun, I think this business has the potential to grow. Computer ownership is increasing, and the demand for internet cafes is huge. We can definitely turn it into a chain brand, with a unified image, unified management, and unified procurement, just like McDonald's."

"I have an idea," Ling Yun nodded, "but we need to be careful about the pace. If management can't keep up, expanding too quickly will cause problems."

"I understand," Zhao Weiguo said. "We now have four supervisors, each responsible for five or six stores, who visit the stores once a month. The management system is also being upgraded, and we are preparing to add video surveillance so that we can see the situation in the stores remotely."

"Do you have enough funds?"

"That's enough." Zhao Weiguo opened the ledger. "Internet cafes are profitable, and with the franchise fees and service fees, we have over a million yuan in cash in the account. We make large purchases for our internet cafes, and all of them have payment terms. The renovation costs for Shanghai and Beijing have already been paid, and the equipment costs will be paid in three months."

Ling Yun thought for a moment.

"I'll invest another five million in you. We'll establish 'Spark Internet Cafe Management Company,' operating independently. You'll hold 10% of the shares, and I'll cover the rest. Our goal: to open one hundred stores within a year, covering major first- and second-tier cities."

Zhao Weiguo was stunned.

"Five million? That's too much..."

"Not many," Ling Yun said. "If we're going to do it, we'll be the biggest. We'll not only operate directly, but also open up franchising. We'll set industry standards, training systems, and supply chain management. In the future, all the computers, tables, chairs, and drinks for internet cafes will be sourced from us."

"That...that would be a lot of people."

"Recruit," Ling Yun said. "Recruit graduates from Shandong University and train them to be store managers. Recruit network administrators from vocational schools. Establish a complete promotion system: network administrator - store manager - regional manager - regional director."

Zhao Weiguo took a deep breath.

"Brother Yun, you've taken too big a step."

"Not much." Ling Yun stood up and walked to the window. "It's 1997 now, and the internet cafe industry is just starting out. Whoever establishes a brand first will dominate the market. In three to five years, when computers become widespread, internet cafes will upgrade to internet cafes, and then to e-sports arenas. We need to be ahead at every stage."

Zhao Weiguo wrote it down.

"So... how exactly do we do it?"

"The first step is to register the company and build the team. The second step is to improve the management system and develop a franchise manual. The third step is to establish directly operated flagship stores in Beijing, Shanghai, Guangzhou, and Shenzhen to build brand image. The fourth step is to open up franchising and expand rapidly."

"What about time?"

"The first two steps will be completed this year. Large-scale expansion will begin next year."

Zhao Weiguo nodded.

"I'll do it."

"Oh, by the way," Ling Yun turned around, "the electronics factory has just released a new batch of optical mice and mechanical keyboards. You can try them out in internet cafes and collect feedback. If they perform well, we'll promote them as standard equipment."

"Great idea," Zhao Weiguo said. "Many players are complaining about unresponsive mice and poor keyboard feel. If we can use better equipment, we'll definitely attract more people."

"And another thing," Ling Yun added, "collaborating with game companies. For example, Blizzard, they're about to release StarCraft. We can hold tournaments in internet cafes, they'll provide the prizes, and we'll profit from the popularity. A win-win situation."

"This is something I'm good at," Zhao Weiguo laughed. "I used to play basketball, so I have experience organizing games."

The two chatted about the details for a while longer.

At 4:30, Lingyun prepared to leave.

"Brother Yun," Zhao Weiguo saw him downstairs, "thank you for giving me this opportunity."

"You seized the opportunity yourself." Ling Yun patted him on the shoulder. "Keep up the good work. When Xinghuo Internet Cafe goes public, you'll be one of the founders."

"Going public?" Zhao Weiguo's eyes widened.

"Yes," Ling Yun said, "but that's still a long way off. Let's focus on the things at hand first."

As they left the internet cafe, Zhao Hu drove his car over.

"Mr. Ling, where's our next stop?"

"The electronics factory. Go see Ma Baoguo."

On the bus, Ling Yun looked out the window.

Zhao Weiguo has truly seen the light. He's gone from simply running an internet cafe to providing solutions, and now he wants to create a chain brand.

This is a promising talent.

They are worth nurturing.

He recalled those internet cafe giants from his previous life, who later transformed into e-sports, live streaming, and game publishing.

In this life, he wants to take Xinghuo Internet Cafe even further.

To become a true ecological gateway.

Just as the Star System is the software entry point and UHSB is the hardware entry point, internet cafes are the entry point for offline traffic.

Only when these three elements are combined can a complete closed loop be formed.

The car arrived at the entrance of the electronics factory.

Ma Baoguo was already waiting there.

"President Ling!" He jogged over. "You're finally back."

"Let's go inside and talk."

As you enter the factory area, the machines roar.

The new production line has been installed and is currently undergoing trial operation.

Everything was in good order.

Ling Yun felt a little more at ease.

This is the foundation.

Stock market, foreign exchange market, venture capital... those are all just fleeting gains.

The real industry is here.