China Xiaokang Network Exclusive article
Text | East Rise
Read well, do not seek understanding; Happy to speak, not agitated and not followed.
After the Opium War, foreign capital poured into China. Some industrialists who were enthusiastic about foreign affairs let go of the development of foreign affairs, and national capitalists with strong financial resources rose up in this upsurge. Due to China’s weak industrial base and scattered capital, national entrepreneurs cannot afford to carry the huge investment and equipment of heavy industry, and their attention has turned to light industry, which has little investment, quick results and a broad international market. Under the call of “boycotting foreign goods and developing industry and commerce”, the Qing government was forced to change from official to encourage commercial office. At that time, the brothers Sun Duoxin and Sun Duosen decided to achieve a hegemony in Shanghai under the guidance of their mother. They chose to knock on the door of entrepreneurship with flour.
China’s traditional flour processing mostly uses manual grinding or livestock pulling, and the production efficiency is extremely low, while the increase in urban population makes flour in short supply; Coupled with years of war and strong demand from the army, the modernization of the flour industry is imminent. The First World War greatly expanded the international market for flour. The Sun brothers saw that foreign flour was dumped in the Chinese market and exploited the people, so they saw the opportunity and took out their savings for many years and raised 200,000 taels of silver with their uncle Sun Chuanding (Jiangxi Linjiang Prefectural Prefecture), brother Sun Duoyan and relatives and friends He Zhizhou, Gong Jingzhang and others, and chose the south bank of Suzhou River in Shanghai to establish the first national enterprise large-scale flour mill Fufeng Flour Mill, and began the arduous road of entrepreneurship.
In the twenty-fourth year of Guangxu of the Qing Dynasty (1898), the Sun brothers learned about the import of foreign flour from Shanghai Customs, and fully understood the German merchant Zengyu flour mill, and after overseas inspection, decided to purchase 80 acres of land on Moganshan Road and build a factory building modeled on the American machine room. For $22,000, they purchased a set of U.S. milling equipment, including 16 steel mills, and determined that the flour trademark was “bicycle” brand. The registered trademarks of Fufeng flour are: phoenix play peony, heroic independence, artillery car, double fish, joy bird, flying tiger, pegasus, conscience, centaur, peach blossom, lotus, orchid, double tiger, etc., and the most famous is “bicycle”, Shanghainese used to popularly call it an old license plate. Because in Shanghai at that time, the bicycle was a fashionable thing, representing speed.
Comparing your flour business to a bicycle is a good sign of uplift. In 1899, the equipment of Fufeng Flour Mill was installed, and it was officially put into operation in 1900, with a daily output of 2500 bales of flour. At the same time, Sun Duosen registered with the Ministry of Commerce to apply for flour tax exemption, and the Sun brothers’ grandfather Sun Jiayu played Empress Dowager Cixi, and was allowed to “reduce or reduce taxes and pass throughout the country.” After everything was ready, in the twenty-sixth year of Guangxu of the Qing Dynasty (1900), Fufeng Flour Mill was officially opened, Sun Duosen and Sun Duoxin were appointed as the chief and deputy managers, and Ning Yuting was the director of the factory, with 46 workers and 32 employees at that time. Because the machine purchased by Fufeng is China’s first set of milling machines imported from the United States, the equipment is advanced, and there are no domestic technicians who can be competently managed, so Fufeng has built a small Western-style building in the factory, and hired American technicians to guide production and train technicians with a salary of $200 per month.
At that time, foreigners’ flour mills used imported wheat. In order to quickly occupy the market with its own flour, the Fufeng factory uses a blend of foreign wheat and national wheat, which is more suitable for the taste of Chinese, and the price is much cheaper. They broke up the flour into small packets of several kilograms, went to restaurants and snack shops to sell, and soon succeeded in opening up the situation.
Due to the turmoil of the Boxer Rebellion at the beginning of its establishment, the eight-nation coalition army attacked Beijing, the Qing government abandoned the capital and fled, and the situation was turbulent; In addition, Sun Duosen was an important government member at that time, lacking skills, and had little question about the operation of the flour mill, and had been neglecting the operation, so that he lost more than 30,000 taels at the beginning of his business. Fufeng Machine Flour Mill issued shares many times, raised funds from the society, and in 1904, the capital increased by 100,000 taels, and the capital reached 300,000 taels to increase processing equipment, coupled with the emphasis on strengthening business management, Fufeng began to turn losses into profits.
(“Xiaokang” · China Xiaokang Network exclusive article)
This article was published in the early January 2022 issue of Xiaokang