The Path of China's Private Economy Development: An Overview of the Success Secrets of Enwei Group's Entrepreneurship and Takeoff

Author: Liu Bo, Wang Nengming / Country: Mainland China
Publisher:
Publishing Date: 2005-01-01
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Three, Dare to Ride the Wind and Forge a New Path for Entrepreneurship Opportunities are like a fine horse. When it gallops past you, if you can ride it, you may soar thousands of miles; if you fail to seize it, you can only crawl along with difficulty. In the spring of 1983, Xue Yongxin, who had rushed home from Yunnan to attend his grandfather's funeral, witnessed the rise and surge of various contract systems centered around the household responsibility system. The public opinion environment had become more open, and the policy direction was clearer. He decided to seize this opportunity and showcase his talents. Thus, he boldly took over the Wuxingchang Wood Processing Factory in Shuangliu County, Sichuan Province, and later established a wood processing business in Hongpailou, the southern suburbs of Chengdu, primarily producing wooden doors and windows. After opening, the business flourished for a time, greatly boosting Xue Yongxin's confidence. However, life is unpredictable, and misfortunes struck again. He was detained in a reeducation-through-labor camp on three unfounded charges, spending 115 days there. Fortunately, he encountered an impartial and incorruptible official who eventually clarified the facts and issued an "innocent release" notice, clearing Xue Yongxin of the injustice he had suffered.
After Xue Yongxin returned to the factory with the vindication, his wood processing plant had been abandoned and left empty. After his detention, the local authorities seized the factory under the pretext of "illegal operation," and both the machinery and timber had vanished. While lamenting the hardships of his life's path, he resolved to overcome all obstacles and start anew. The day he returned to Shuangliu County, Xue Yongxin immediately went to the industrial and commercial bureau to apply for a business license. To accumulate funds, he decided to start small, renting a vacant small factory on the outskirts to continue his wood processing business. After two years, he had saved a modest amount of money and began to consider investing it in a project suitable for his development.
In 1985, Xue Yongxin caught a significant piece of news from the media: the country was about to introduce the Forest Law, which would bring new regulations on wood management. After carefully analyzing and judging this information, he decided to quickly pivot, cease wood processing, and establish a new project focused on developing new products through science and technology. He invited several technicians to help him brainstorm, and after joint deliberation, they conducted feasibility studies from multiple perspectives—market demand, investment potential, return on investment, and talent and technology. Ultimately, they decided to establish a medium-sized chemical plant to produce dry-cleaning agents.
Xue Yongxin was a man of action, and he quickly completed tasks such as site selection, project approval, equipment purchase, and recruitment of technical personnel and workers, before rapidly moving into trial production. The first batch of products was named "Enwei" brand. To quickly capture the market, he set up a "Enwei" brand dry-cleaning agent sales point at Chengdu Department Store for trial sales to explore market penetration. Within a week, sales reached 40,000 yuan. The initial success greatly boosted Xue Yongxin's confidence. Six months later, the "Enwei" brand dry-cleaning agent had almost dominated the dry-cleaning market in Chengdu, with the factory earning a profit of 300,000 yuan. However, good times were short. Dry-cleaning businesses in Chengdu began to switch to imported dry-cleaning agents. The reason was that imported dry-cleaning agents cost 800 yuan per ton, while "Enwei" dry-cleaning agents cost 1,000 yuan per ton, and their quality could not compete with imports. Additionally, the Chinese people had a tendency to trust foreign products. As the market shrank, Xue Yongxin did not engage in price competition and did not lose heart. Instead, he tirelessly sought a new project.
In 1987, he accepted an invitation from Chengdu Science and Technology College, and both parties reached an agreement to produce tetrachloroethylene. The college invested 400,000 yuan to handle production technology, while Xue Yongxin invested the factory and some equipment for production management. After the agreement was signed, production began after six months of preparation. However, Xue Yongxin, full of expectations, never imagined that tetrachloroethylene would act like a furnace that devours iron. Within less than a week, the pipelines were corroded and leaking, and the entire workshop was contaminated by chemicals. Forced to halt production for repairs, the new pipelines replaced at a cost of tens of thousands of yuan were soon corroded again. Moreover, the purity of the tetrachloroethylene never reached the 99% standard, and its market demand remained poor. Despite continuous investment, the benefits continued to decline. His partners withdrew, wanting to pull back their investment. The short-term operational failure plunged Xue Yongxin into great confusion and frustration: Where was the way out? What path should he take?
In his deep contemplation, a spark of inspiration suddenly flashed—medicine! The medicine of Taoism. Why not develop his master's prescriptions? Which ones should he develop? He proposed idea after idea, only to reject them one after another. Yet, there is no path that leads to ruin. Just as he was indecisive, a friend came to visit him specially. Upon learning of his and, the friend advised him to decisively abandon tetrachloroethylene production and explore a new path to develop new products. He proposed developing his master Li ZhenGuo's (a Taoist master skilled in medicine) prescriptions to research and develop compound traditional Chinese medicine for treating venereal diseases.
Upon hearing this, Xue Yongxin jumped up, patted his friend's shoulder, and confidently said: "It's as if two heroes saw eye to eye!" His friend's suggestion was so in tune with his own thoughts, further strengthening his confidence and determination. Xue Yongxin carefully studied the dozens of prescriptions left by his master, repeatedly pondering and questioning. After countless sleepless nights of thought and simple experiments, he finally formulated the ideal prescription.
Having the prescription was just the beginning; pharmaceutical production and sales were the key. The process of pharmaceutical production was complex, requiring high standards for the environment, equipment, and technology. His factory had no distillation, extraction, or high-pressure equipment at the time. Yet, Xue Yongxin stubbornly adopted a makeshift approach, using simple equipment to begin trial production. To ensure sterilization, he used boiling water to rinse and then steam at 120°C to disinfect. Without specialized equipment for decocting medicine, he used enamel reaction pots. Without filtration equipment, he used sterilized gauze as a substitute. Overcoming countless difficulties and surmounting many technical challenges, he finally produced the first batch of liquid medicine.
The efficacy of the medicine needed clinical trials to prove, but without a production license, he could not apply for hospital trials. Xue Yongxin conducted experiments on himself and his wife. "Heaven rewards those who are diligent," and after a whole summer of repeated experiments and improvements, the new medicine showed increasingly ideal effects. Before the expert evaluation, the liquid medicine needed a brand name—one that was vivid, concise, memorable, and appealing to users. Following the usual procedure, it would have been necessary to gather "experts" for discussion and deliberation or to solicit opinions externally. However, Xue Yongxin broke the convention, writing down the three characters "Jie Er Yin" in the product name section of the report. His idea was that people would see the name and immediately feel a sense of connection, encouraging them to confront sexual organ diseases and change outdated sexual concepts.
The expert evaluation passed smoothly three months later, and Xue Yongxin obtained approval from the relevant authorities to produce "Jie Er Yin." From then on, the "Enwei people" soared like a bird taking flight. P36-38