Hiss!
Gasps of astonishment filled the air as the heads of several major medicinal merchants and herb gathering teams stared wide-eyed at Xiao Yan.
They all wondered if they had just experienced an auditory hallucination!
Xiao Zhan was equally startled, but out of confidence in his son, he suppressed the urge to question Xiao Yan and also put on a calm and confident expression!
A middle-aged man stood up and arched his hand toward Xiao Yan as he said, "Little Clan Leader Xiao Yan, it's not that I don't believe you, but I would like to ask, do you know how much gold it would take to purchase these medicinal ingredients for a year?"
The reason why the major medicinal merchants widened their eyes was simple: the amount mentioned was astronomical! Such a sum could hardly be procured by anyone. Except perhaps the headquarters of the Miteer Auction House, even the Miteer Auction House itself might struggle to come up with that much cash.
Medicinal ingredients weren't necessarily used for alchemy; they could also be used by physicians to compound medicines for treating injuries and illnesses. In Wu Tan City, the vast majority of medicinal ingredients were consumed by physicians for medical purposes.
Xiao Yan set down his teacup and said after some mental calculations, "Although these four types of medicinal ingredients are of the lowest grade, they are not cheap. Our Xiao Clan also sells these ingredients, so I have an estimate of your annual production. I've done some rough calculations. For the combined cultivation of the medicinal merchants and herb gathering teams of Wu Tan City, each type of ingredient would require about 300,000 gold coins per year. Since our offer is 50% higher than the market price, that would be 450,000 gold coins for each type of ingredient."
"So it would take 1.8 million gold coins per year, and for three years, that is 5.4 million gold coins. The deposit is 10%, so if you agree, we can provide you with 540,000 gold coins right away."
Xiao Zhan's heart skipped a beat. In fact, there was still more to consider, as the few major medicinal merchants and gathering teams only accounted for about half of Wu Tan City's supply. The Miteer Auction House still had the other half!
Just last year, the Xiao Clan spent over 400,000 gold coins to acquire a High Xuan Class Qi Method. The clan's wealth had already been greatly depleted. They were no longer able to produce such a huge amount of money!
The medical merchants began a heated discussion upon hearing Xiao Yan's meticulous calculations. But Xiao Yan impatiently waved his hand and said, "Alright, alright. If you want to discuss, go back and discuss behind closed doors. Give us your answer first thing tomorrow morning."
Even Xiao Zhan scratched his head, wondering what his son was up to. He just sent the guests away??
"In that case, we'll take our leave. We'll come back tomorrow morning to visit Clan Head Xiao Zhan and Little Clan Leader Xiao Yan."
Everyone breathed a sigh of relief when Xiao Yan gave the order to leave.
Xiao Zhan asked immediately after everyone had left, "Yan Er, if you let them go like this, they will definitely rush to the Jia Lie and Ao Ba Clans overnight."
Xiao Yan smiled and said, "That would be best."
"Huh? Yan Er, are you... are you not trying to monopolize the medicinal ingredients to cut off their supply, but to raise their prices instead?!"
Xiao Yan didn't hide anything as he nodded, "Father, if our clan were to cooperate with an alchemist to sell medicinal pills, what would the profit split be?"
Xiao Zhan thought about it for a moment and said, "If the clan is responsible for the medicinal materials, then an ideal split would be a 50/50 split. 50% of the profit goes to the alchemist, 20% covers the cost of the medicinal materials, and 10% goes to sales, packaging, and labor, leaving the clan with 20%."
"Most of the time, though, it's a 60/40 split in favor of the alchemist. After all, alchemists are hard to come by. If the clan can still take a 10% share, it is something to be thankful for..."
"Ah!"
Xiao Zhan had a moment of realization and looked at his son with pleasant surprise. "So you intend to raise the price of medicinal ingredients on the market by 50%. That way, the markup on the medicinal materials would be exactly the same as the profits. If they dare to raise their bid, they'll end up losing money. Liu Xi would never lower his own profit margins, so the increased costs would have to be deducted from the clan's profits. You want the Jia Lie and Ao Ba Clans to lose money with every pill they sell!"
Xiao Yan explained nonchalantly, "In the past two months, they've raised the price of their Rejuvenation Powder from the original 100 gold coins to 300 gold coins. It's already at the limit of the mercenaries' purchasing power, and they've accumulated quite a bit of resentment. Once they cut off the supply of pills, it will be the last straw that breaks the camel's back. Even if we do nothing, no one will go to their market to buy things anymore."
"If they choose to transport medicinal ingredients from outside the city instead, as long as we intercept them once, they'll definitely go bankrupt."
Xiao Yan and his father exchanged sly glances, resembling two foxes, one big and one small.
…
In the late hours of the night, just as Xiao Yan had predicted, the Jia Lie Clan residence was still brightly lit, with Ao Ba Pa and some elders of the Ao Ba Clan present as well.
"That damned Xiao Zhan! To think he'd pull such a sneaky move!" Jia Lie Bi crushed a cup in his hand.
Several merchants had already visited them earlier. After all, the best scenario for these merchants and herb gathering teams was to let these clans outbid each other to maximize their profits.
"Dad, maybe we should just forget about it. If we raise the bid to 60%, we will be operating at a loss. We could still transport medicinal ingredients from outside the city," Jia Lie Ao cautiously suggested.
"You know shit! Xiao Zhan's goal is precisely to make us spend money buying medicinal ingredients from outside the city. Once we leave Wu Tan City, we won't have any protection. We are in the light while they are in the shadows. If our supplies are intercepted and stolen, the consequences would be unimaginable."
After being scolded by Jia Lie Bi, Jia Lie Ao immediately shut up and dared not speak further.
Ao Ba Pa's expression turned grim. "What a Xiao Zhan, this is simply an overt plot. Brother Bi, how about we lower the prices first to stabilize public opinion before deciding on our next move?"
"Lower the prices?" Liu Xi, who was sitting aside, frowned upon hearing this. He was clearly reluctant. After all, his share of the profits was based on the selling price. There was a big difference between 60% of 300 gold coins and 60% of 100 gold coins.
Liu Xi sneered, "Do whatever you want, but even if you lower the prices, I still want my cut based on the previous tripled price."
At this moment, Jia Lie Bi and Ao Ba Pa wished for nothing more than to slap this guy into oblivion.
After pondering for a moment, Jia Lie Bi said, "There's no need to lower the prices. As long as the cost of the medicinal ingredients doesn't exceed the market price by more than 50%, we can still break even. Once all the shop owners from the Xiao Clan market switch over to us, we will still have the last laugh."
"Tell those merchants that we will only offer up to 50% above the normal market price, and not a penny more. However, we can negotiate a five-year contract with them and provide a 20% deposit."
"If they refuse, then let them go to the Xiao Clan. We will make a trip to the Miteer Auction House and ensure that they prioritize selling the medicinal ingredients to us."
However, they all knew that when it came to cunning merchants, Miteer Ya Fei was the biggest one in Wu Tan City. They presumed that she would also be aware of this situation, and the next time they went to the auction house to purchase medicinal ingredients, those ingredients would likely be priced higher under various pretexts.
Jia Lie Bi could only hope the vixen wouldn't be too ruthless.
…
Early the next morning, as Xiao Yan had anticipated, the medicinal merchants visited the Xiao Clan once again. This time, however, Xiao Zhan refused to see them altogether, unwilling to raise the prices any further or even engage in negotiations.
And so, the entire Xiao Clan fell into silence once again. Yet, everyone knew this was merely the calm before the storm.
Five days later...
"Little Clan Leader, the two major clans have already signed contracts with all the medicinal merchants and have paid the deposits," Xiao Ning hurriedly reported as he entered the council hall.
Xiao Yan revealed a hint of confidence and waved his hand as he commanded, "Third Elder, find some disciples with unfamiliar faces to disguise themselves as foreign merchants. Sell to the Jia Lie Clan, the Ao Ba Clan, and those few merchants all the low-grade medicinal ingredients our clan hoarded six months ago, except for the few items listed here, at high prices."
"Second Elder, immediately take people to various underground places and market squares to spread the news. Just say that the Xiao Clan has obtained the pill recipes for the Rejuvenation Powder and the Minor Dou Qi Pill, and has invited an alchemist to refine these two types of medicinal pills. That's why we're competing with the other two major clans for medicinal ingredients. Also, announce that the Clan Head will be visiting the Miteer Auction House to discuss a long-term cooperation."
"Grand Elder, have someone post notices in the market and all of our Clan Xiao's business places. I want the whole city to know that the Xiao Clan Market will soon have medicinal pills for sale, and they will be cheaper and more effective than those at the Ao Jia Market."
"Father, please patiently wait until tomorrow, then go to the Miteer Auction House to clarify things with Miss Ya Fei. Just say that the rumors in the streets are false, and we haven't obtained the pill recipes for the Rejuvenation Powder and Minor Dou Qi Pill. Assure her that we will absolutely not compete with the other two major clans for medicinal ingredients, so the Miteer Auction House can feel confident in cooperating with them. Also, inform her that the Xiao Clan will attend the Miteer Quarterly Auction in three days as invited."
With that said, Xiao Yan closed his five fingers together. It was as if everything was within his grasp!