The Mech Touch novel Chapter 252

The conference room projected his grandfather and five other board members in a lifelike fashion. All of them sat sat at the table with expressions of hope and anticipation.

After the formalities went out of the way, that optimism quickly disappeared as Ves did not approve of their suggestions.

A financial expert began to speak. "Entering the Bentheim market is a daunting venture that has broken many ambitious companies. We’re going to need to build up a warchest. Right now, your various assets are tied up in a perplexing manner. There are ways we can leverage this situation to raise a lot of funds."

The man put up a snazzy presentation that entailed issuing stock and piling up debt. All of it sounded great, but Ves wasn’t interested in a quick payout.

"I’m open to issuing a limited amount of stock, but I’m not a fan of complicating the ownership structure to this extent." Ves shook his head. "Let’s not put the cart before the horse. The LMC isn’t short on cash right now. Let me complete my design and figure out how much we have to spend on marketing before we address the need to raise more funds."

The financial expert probably had ties to the very same banks and investment companies willing to get involved. The board member would increase his effective control over the LMC if his buddies held a lot of its equity and debt.

Ves could tell that people had been eyeing some of the exclusive licenses he obtained from the Clifford Society. If he wanted to maintain his advantage, he had to keep the licenses to himself and only to himself.

"Our company is running far below its potential capacity." A woman spoke up next. She turned out to be product expert. "Many licenses are time-sensitive and it will take who-knows-long until you finish your next design. It’s best if we hire more mech designers and expand our catalog of designs."

"I don’t wish to dilute my brand with designs that don’t adhere to my design philosophy. I’m pursuing quality over quantity so I’m very exacting in the type of mechs I want to sell."

"Then setup a different brand. It’s not that difficult to draw a line between your own products and those designed by others. You can continue to pursue perfection while our other crop of mech designers can aim for mass market penetration."

"I’m not open to hiring other mech designers. I founded the LMC to provide a platform to develop and sell my own products. I don’t want to provide safe haven for a bunch of losers who can’t make it in the mech industry on their own."

Any external mech designer that the company brought on might be using it as a springboard for their own careers. They’d use the licenses and production facilities that Ves had tirelessly accumulated and hop off his train after they achieved commercial success.

Another possibility was that these external mech designers might take over the company’s direction. If they developed a lot of designs that collectively earned more, they could diminish the value of his own products.

"What will it take then for you to accept more mech designers?"

"They’ll have to work under me for a long period of time. Right now, the only possible candidate is Carlos Shaw."

"I see." The woman replied while looking down at her terminal. "According to the records, he’s an able but inexperienced fabricator who is unremarkable in many ways. You can find many competent mech designers off the streets of Bentheim that can do a better job than a former classmate of yours."

"The difference is that I don’t trust random bums off the streets even if they can design a bestseller. If they’re actually that good, they should have started their own company or find someone else that can sponsor their work. It’s not the LMC’s goal to promote other mech designers."

After this, a mech industry expert started to tout his connections to Bentheim. "The LMC may have put their roots in Cloudy Curtain, but limiting it to an agricultural planet will severely hobble its growth. Any mech business needs a presence in Bentheim. I can put you in touch with some of the regional powers that can facilitate a deal regarding the foundation of a second site."

Such a second site would likely become the main base of production for the LMC, effectively giving control of a major revenue source to the mech industry expert’s buddies.

"A second plant is not in consideration at the moment. Our current production facilities are already capable enough to meet a fair amount of demand. Since I’m in the business of selling premium mechs, I see no immediate need to expand our production capacity for the immediate future."

Ves parried a few more traps couched in helpful suggestions. Once the board members realized that he wouldn’t fall for their tricks, the conference meeting shifted into an awkward silence.

His grandfather Benjamin broke the silence by bringing up something that actually sounded constructive, a first for this meeting.

"At the moment, you’ve signed a contract with a Bentheim mech broker named Marcella Bollinger. I’ve read through the contract, and while it allows you and your company to outsource all of your sales and support to her, the compensation she demands is uncharacteristically high."

The other board members nodded in agreement. "The standard rate should be ten percent of gross profits. The contract you signed gives her a twenty percent cut."

All of the board members looked at Ves like he got taken advantage of. Which he did, but he needed the extra help.

"The contract is only valid for ten years. We can always renegotiate after the current term ends."

"We can do better." His grandfather added, surprising Ves. "Rather than see it as an exploitative relationship, consider the initial contract as an opening for deeper cooperation. Even if we build up our own marketing capabilities from scratch, we’ll never surpass Bollinger’s brokerage in terms of understanding the market and finding the best customers."

A few board members disagreed. "I know at least five great marketers who can be persuaded to head a marketing division in Bentheim."

Benjamin shook his head. "It’s not worth the effort. Consider the amount of money other mech manufacturers spend on their marketing. It can suck up to a billion credits a day. That’s only for the mass-market segment. The premium segments rely more on personal connections to make a sale, something which Bollinger is very adept at. Can we find someone as equally formidable as her in the Bentheim market?"

Someone with so many connections either joined larger organizations or ran their own businesses. Even a medium-sized mech manufacturer didn’t enter their eyes.

"What are you getting at, grandfather?"

"The contract can’t be breached without a penalty, but it can be renegotiated if both sides are willing to make adjustments. I think it won’t be unreasonable to make a demand to lower your mech broker’s cut in exchange for a longer partnership. You’ve grown significantly since you first entered into a deal with her. Your future prospects is worth too much to risk being ditched at the end of a short ten-year contract."

His words sounded persuasive, and some of the other board members expressed approval at the suggestion. On the other hand, the remaining board members thought that the LMC should wait out the nine remaining years and run their own marketing operation from then on.

"Marcella has been very helpful throughout my career and I don’t like to spoil that relationship." Ves decided after hearing out some arguments for both sides. "Even if my contract with Marcella ended, I had already been leaning towards renewing it with fairer terms. I guess we can try to push it forward."

It didn’t risk much to make the offer. As long as he did well with his first original model, Marcella would have a gold mine in her lap. Thus, her acceptance depended on her estimation of his future performance.

The discussion soon turned to overall strategy. "You’ve repeatedly made it clear that you are targeting the premium segment. However, there are only so many rich customers in the market. I think it’s prudent to evaluate whether it serves the company to offer a cheaper selection of models. Not immediately, but in the medium term."