Return To The Building Owner [EN]: Chapter 523

A week later.

A banner hung in front of Hyun-sung’s video store proclaimed:

“Everything 500 won!”

Two people stood gazing at the banner.

Lee Myung-hoon turned to Hyun-sung, a worried expression on his face.

“Are you really going to rent everything at this price starting today?”

“Of course.”

“Is it because of Movie Heart?”

“Yeah. Either way, when Movie Heart opens in three days, they’re going to undercut our prices. Since we’re charging 2,000 won [approximately $1.50 USD], they’ll definitely come in with 1,000 won [approximately $0.75 USD], which is half the price.”

This was a tactic Movie Heart had used in his past life.

They would undoubtedly use the same method this time, implementing point accumulation and advance payment systems.

Ultimately, their strategy revolved around attracting customers with ridiculously low prices and then trapping them with loyalty programs.

Of course, that method had worked in his past life.

The reason was simple: the local rental stores were all small and couldn’t even contemplate competing with a large chain store like Movie Heart.

But now, things were different.

He already knew their playbook and exactly how to counter it.

And the method wasn’t complicated at all.

He simply had to turn their own tactics against them.

Lee Myung-hoon spoke again.

“So, you’re saying you’re going to undercut Movie Heart before they even start their price dumping?”

“That’s right. Do you know what the best technique in a fight is?”

“Of course, it’s to land the first blow.”

“Exactly! Since I know the opponent is going to strike, why wait around? In this case, it’s best to strike first.”

Hyun-sung threw a punch, as if hitting an opponent square in the face.

Then Lee Myung-hoon tilted his head, a question forming on his lips.

“What happens if Movie Heart doesn’t just sit still?”

“If they don’t sit still?”

“What if they lower the price even further…?”

“No, they absolutely can’t!”

Hyun-sung shook his head emphatically.

Lee Myung-hoon tilted his head again, sensing an overwhelming confidence in Hyun-sung’s words.

“Absolutely? What makes you so sure?”

“They can’t make it work at 500 won. The store spends between 8 million and 10 million won [approximately $6,000 – $7,500 USD] a month, minimum. That means they have to earn 300,000 won [approximately $225 USD] a day, no matter what. But earning 300,000 won a day charging only 500 won is no easy feat.”

Hyun-sung paused, then continued.

“And even if they do earn 300,000 won, they’re just spinning their wheels. How long do you think they can keep that up?”

“Um… Boss, wait a minute. Something’s not adding up.”

Lee Myung-hoon looked at Hyun-sung, a puzzled expression on his face.

“What is it?” Hyun-sung asked.

“According to what you just said, it’s difficult to make 300,000 won a day charging 500 won. So, what about us?”

“Us?”

“Yes. Didn’t you say that our store has 60 to 70 million won [approximately $45,000 – $52,500 USD] invested in video purchases alone? And we have five employees…”

Lee Myung-hoon’s voice trailed off, his concern growing.

It was a valid point.

The commercial districts were practically the same, separated by only 100 meters [approximately 330 feet] at most. They were essentially in the same market.

If it was difficult for Movie Heart to make 300,000 won charging 500 won, Lee Myung-hoon figured Hyun-sung’s store would face the same challenge.

As soon as Lee Myung-hoon finished, Hyun-sung responded.

“We’re different.”

“Different?”

“Yeah, we have delivery.”

“Delivery?”

“Yeah, I’m going to use a two-track strategy.”

“Are you saying you’ll charge 500 won at the store but normal rental fees for delivery?”

Lee Myung-hoon seemed to catch on, his eyes widening with understanding.

“That’s right, exactly! That’s how we’ll differentiate ourselves.”

“Ah, I see. So, that’s why you started delivery from the beginning?”

“Of course, that was one of the reasons. But that’s not all. We’ll talk about that later. Now, here’s an important question. If that happens, what kind of phenomenon do you think will occur?”

“Are you talking about having different prices for the store and delivery? Um… If that happens, people near the store will come to the store, and only people far away will order delivery, right?”

“Of course, that’s what will happen, right?”

“Yes, of course.”

Lee Myung-hoon nodded, as if it were obvious.

Then Hyun-sung asked again.

“If that happens, what other phenomenon do you think will occur?”

“Um… If that happens, delivery will decrease a bit, and people will flock to the store, so… Oh? Will the store’s sales increase? Am I right? Is that what you’re aiming for?”

Lee Myung-hoon’s eyes lit up, as if he’d discovered a hidden treasure. He was practically beaming.

Hyun-sung nodded.

“That’s right. Of course, we’ll have to wait and see the results, but that’s my prediction. When you order delivery, you only order what you really want to see. But when you come to the store, there are many videos you haven’t seen before, so there will be many things you want to see. That’s why I’ve been paying attention to the variety of videos. And with the rental fee only 500 won, there’s less burden, so the number of rentals will increase.”

It was obvious, perhaps.

Coming to the store and choosing directly was different from ordering delivery from home. And the price was cheap, so the number of rentals would naturally increase.

But Lee Myung-hoon tilted his head, still puzzled.

“But, a little while ago, when you were talking about Movie Heart, didn’t you say that it’s not easy to make 300,000 won a day at the store with a 500 won rental fee? What about that?”

“That’s based on Movie Heart’s store. We’re different.”

“Different?”

“Of course. They only spend 5 million to 7 million won [approximately $3,750 – $5,250 USD] a month on purchases at most, but we spend ten times that amount. Basically, it’ll be around 60 to 70 million won [approximately $45,000 – $52,500 USD].”

“So, in the end, it’s a battle of the number of new releases.”

Lee Myung-hoon nodded, finally understanding.

Hyun-sung continued.

“That’s right. In the end, a concentration phenomenon will occur because of the number of new releases. It means it’ll all be concentrated in one place. People’s psychology is that even if it’s the same movie, they’ll flock to a place where 360 copies are available, rather than a place with only 20 or 30 copies.”

This was a tactic Movie Heart had used in his past life.

At that time, other stores would only receive about 2 or 3 copies of a big hit, but Movie Heart would place at least 20 copies, so customers naturally had no choice but to go there.

But now, the tables were turned.

“What happens if Movie Heart buys 300 copies like us?”

“I’ve already checked.”

“Yes? Checked?”

“Yeah, you know that Mission Impossible starring Tom Cruise is being released in three days, right?”

“Yes, that movie was a big hit when it was released last summer, right?”

“That’s right. But I heard that Movie Heart ordered 30 copies of that movie.”

“Then, even if they receive push volume [extra copies provided by the distributor], it means they’ll only have 36 copies?”

Lee Myung-hoon’s expression relaxed. Even though he had only worked at the video store for a week, he understood the situation.

He asked again.

“What’s the reason?”

“Reason?”

“Yes, why can’t the owner of Movie Heart buy a large quantity like you?”

“Perhaps the reason is twofold. One is money, and the other is that they’re scared because they don’t have experience.”

It was Hyun-sung’s own situation in his past life.

He studied for two more years after graduating from college, but he failed the exam he wanted. So, he chose a video store to study more.

But that plan fell through in just one month.

Because of Movie Heart.

Movie Heart opened 100 meters away.

Surviving was the priority. Studying had to be pushed back.

But in a situation where he had no money and no experience, it was impossible to withstand Movie Heart, a large chain store.

In the end, he had no choice but to raise the white flag and move to another place.

Lee Myung-hoon continued.

“Ah… Money and experience. That makes sense. No, wait a minute. I don’t understand the experience part?”

“Why?”

“Isn’t it a chain store? Doesn’t the headquarters manage everything for chain stores? That’s why people without experience usually join chain stores.”

“That’s usually the case. But if you meet the right person, even the headquarters of that chain store can’t help it. Anyway, those guys have their limits.”

“Does that mean you’re more confident than the headquarters of Movie Heart…? Is that right?”

Lee Myung-hoon looked at Hyun-sung with strange eyes.

Hyun-sung smiled.

“What do you think?”

“Haha, I definitely asked the question first…”

“I don’t want to brag unnecessarily. Just wait and see for six months. Then you’ll know.”

“Six months? Does that mean…?”

“I have to finish it by then!”

Hyun-sung emphasized the end of his sentence, as if making a resolution.

Just then…

“Oh my! What’s going on?”

Lee Se-yi, who ran the bakery, asked, noticing the banner in front of the store on her way to work.

Lee Myung-hoon explained.

“It’s because…”

As soon as Lee Myung-hoon finished, Lee Se-yi’s expression darkened.

“Doesn’t Movie Heart know anything about business ethics? How can they open so close, only 100 meters away? They always do that…”

Lee Se-yi’s complaints poured out.

It was the same in his past life. He didn’t remember exactly what she said, but she was angry about Movie Heart moving in, as if it was her own business.

But she also had no choice but to experience the same situation six months later.

She also couldn’t last a year and had to leave the neighborhood.

As soon as Lee Se-yi finished speaking, Hyun-sung said.

“So, I’m going to properly teach them about business ethics this time.”

“Are you confident?”

“Of course. I’m going to take this opportunity to travel around the country and teach those guys who do bad things that they can also be harmed.”

“Yeah, guys who don’t know business ethics should be punished. In that sense, please give me all of Slam Dunk Parts 1 and 2 when I get off work tonight. I’m off tomorrow.”

“You don’t have to go that far…”

“No, I wanted to see it anyway. It’s 20,000 won [approximately $15 USD] for 40, so here you go.”

Lee Se-yi took out two 10,000 won bills from her wallet and handed them over.

“I’m starting it to cheer you on. Hoho…”

“Haha, really…”

Hyun-sung had no choice but to accept the two 10,000 won bills.

Then Lee Se-yi seemed to remember something.

“Oh, didn’t you say you’re selling side dishes from today?”

“Oh? You remembered that too? That’s right. Our youngest [referring to the youngest employee] will be selling them from this afternoon.”

“Okay. I’ll stop by on my way home from work to get a video and buy some side dishes. I was worried about side dishes anyway, so that’s great. Well, I’ll be on my way…”

Lee Se-yi left the store.

Hyun-sung handed the two 10,000 won bills to Lee Myung-hoon.

“Here, today’s opening.”

“Is this what you were aiming for? I wondered why you kept buying martial arts series and comic series even though you already had them. There was a reason for everything?”

“Anyway, even if you charge 500 won, it doesn’t mean anything if there’s nothing to see. From now on, the videos we bought secondhand will be 효자 [hyoja – a Korean word meaning ‘filial son’ or ‘dutiful son’, here implying they will be very profitable].”

That’s right. No matter how low you lower the rental fee, it doesn’t mean anything if there’s nothing to see.

Commonly referred to as 박리다매 [baklidaemae – a Korean term meaning ‘selling many items at a small profit’].

Hyun-sung knew that now was the time to compete with quantity.

That’s why he had been buying secondhand videos from Choi Yoon-soo, a secondhand dealer.

Of course, there was nothing to worry about because he knew exactly which videos to buy. Again, he realized how important experience is.

Just then…

“Boss, I’m done.”

Three employees, excluding the youngest, Yoo Young-seok, walked towards the store. Yoo Young-seok was still not at work because he was making the side dishes that he had decided to sell from today in his room.

Lee Myung-hoon looked at the employees.

“Did you tie the banners tightly?”

The first thing the employees did as soon as they came to work was to put up banners at five nearby rental stores. The banner read ‘Everything 500 won!’

Hyun-sung also had the operating rights to other rental stores, so he was starting a price war at the same time.

Of course, the purpose was to kill Movie Heart, which would open in three days.

“Yes, we tied them tightly. But people were tilting their heads, as if they couldn’t believe it even while looking at the banners.”

“It’s okay. Anyway, after a few hours, the rumor will spread throughout this neighborhood. Now, let’s go inside and prepare for business.”

“Yes, Myung-hoon hyung [hyung – a Korean term used by males to address older male friends or brothers].”

As Lee Myung-hoon and the other employees went inside the store, Hyun-sung’s gaze turned to one place.

A shopping district 100 meters away.

Movie Heart.

Finally, the interior was finished, and the videos were arriving. It would open in three days.

“Hehe!”

A thick smile spread across Hyun-sung’s lips.

In an hour or two, the news would reach the owner of Movie Heart, as well as the headquarters, that all the rental stores in this neighborhood had entered a price war.

I wonder what their reaction will be…

“Now it begins!”

Before he knew it, the smile had disappeared from Hyun-sung’s lips.