The Cursed Blacksmith Who Regressed - Chapter 39

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This chapter was translated by Lunox Team. To support us and help keep this series going, visit our website: LunoxScans.com
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Episode 39

“The beginner equipment market?”

Jang Hae-hyeon asks back.

Choi Hyun nodded his head.

“Yes, I think it would be best to target players who haven’t been hunters for long first.”

“May I ask the reason?”

“For now, that market is the largest and most reliable.”

Jang Hae-hyeon’s eyes widened slightly at Choi Hyun’s answer.

Because it was true.

Choi Hyun’s explanation continued.

“No matter how much Daesan dominates the domestic market, I don’t think we need to create products targeting high-level hunters from the start. To put it bluntly, most high-level hunters don’t use mass-produced items but rather personal custom products or items obtained through farming. So if Daesan needs to rebrand with me at the forefront, we should start by targeting beginner hunters.”

Han Yu-won was inwardly impressed by Choi Hyun’s answer.

Honestly, while she had faith in Choi Hyun as a person, she thought he would lack knowledge in branding and corporate management.

Because hunters and businesspeople are different.

But whether it was the previous Japan import issue or what he was saying now, he didn’t seem like an ordinary twenty-year-old, but rather like someone from this industry.

‘Someone with considerable experience at that.’

Choi Hyun’s words continued.

“Of course, I’m well aware that the beginner market is almost entirely dominated by Chinese equipment. To be precise, they’ve almost monopolized the market with low-price strategies. That’s because even if you buy good quality equipment from the start, the repair costs are very high, and if you lose your equipment while fleeing from gates or dungeons, the financial impact is enormous.”

“That’s right. So honestly speaking, we can’t win in the beginner equipment market no matter what we do. Because China floods the market with equipment through volume tactics, no matter how good our products are or how much we lower our profits, we can’t match their unit prices.”

“Do you know why that is?”

“Why what?”

He didn’t understand for a moment.

Was there a reason why they couldn’t compete on unit prices?

Choi Hyun answered.

“The difference between low-cost and premium beginner equipment isn’t that significant. The price difference is several times over, but the quality difference is really only 20 to 30% at most… If I were in their shoes, I’d buy the low-cost equipment too. Especially since repair costs are substantial, it’s actually more cost-effective to use something and throw it away to buy a new one.”

That’s human psychology.

If the price is very cheap, people would rather use an inexpensive product even if the quality is somewhat lower.

Of course, this applies when the difference from high-quality products isn’t that significant.

But wouldn’t Jang Hae-hyeon know that?

“So are you saying we should match our production costs to Chinese products and make the performance even better?”

“No, there’s no need to do that. We have different manpower, capital, and resources from China in the first place, so how could we close that gap?”

“Then what?”

“Since we’re planning to capture the domestic market first, we just need to maintain our current quality and change our policies a bit.”

“Policies?”

“Yes, I’ve been thinking of various policies, and first, I’d like us to implement a free repair policy.”

“What? Free repairs?”

“Repairs only require a blacksmith player and mana anyway. So there are no separate materials needed, just basic labor costs, making it one of the easiest ways to secure competitiveness. And most importantly, we need a free repair policy to save costs.”

“Save costs? How can we save costs with free repairs?”

“The costs I’m referring to aren’t repair-related costs but training costs. We need to keep developing the blacksmiths we hire. As far as I know, Daesan is currently implementing separate skill training policies to develop hired blacksmiths.”

“Yes, that’s correct.”

“But aside from crafting, I understand that for repair skills, you deliberately break equipment and have them repair it. Instead of doing that, why don’t you send them to repair centers for skill training in repairs? That way, you can save much more costs than the existing skill training policies.”

It was a feasible idea.

That’s because, along with low-cost equipment, repair skills up to level 3 enhancement repairs had no concept of failure.

‘You just put in mana and hammer away.’

Of course, there might be some time differences depending on skill level, but that’s just time.

That’s a problem that would naturally resolve itself over time.

“Hmm, but Daesan’s repair service itself is generating profits, so wouldn’t it essentially be a wash?”

“You might think that, but most of the customers using Daesan’s repair service are mid-level hunters anyway. And repairs for equipment other than our own products are charged much more expensively than private repair centers. In that case, it’s better to boldly make the repair service free and rebrand the company image.”

“I agree with the advisor on this. If a large corporation provides free repair services, honestly, who would want to go to a private repair center? It’s better to receive service from a large corporation.”

Han Yu-won chimed in.

He nodded and said.

“Actually, our Daesan repair service isn’t generating much profit currently. You could say it’s just for show. Only mid-level hunters who use Daesan products use it somewhat, while customers with personal equipment mostly seek out freelance blacksmiths.”

“Yes, that’s right. Furthermore, as far as I know, repair services are the main source of income for freelance blacksmiths. While crafting is usually left to skilled blacksmiths, anyone can do repairs as long as they have mana and a hammer.”

As mentioned earlier, there are no repair failures up to enhancement repairs.

So everyone uses small-scale freelance blacksmiths who engage in price-cutting competition.

Jang Hae-hyeon said.

“I understand. So repairs aside, I still don’t think we can win against Chinese products. Even if we provide free equipment repairs, when hunters lose their equipment itself in dungeons or gates, they have to buy new ones, and that equipment cost would still be burdensome for new hunters, so that can’t be overcome.”

“There’s a way for that too.”

“What way?”

“Sell insurance along with it.”

“Insurance?”

“Yes, engrave serial numbers on each piece of equipment and make it so insurance can only be purchased when buying equipment. Then even if they lose their equipment, they only need to pay a minimum deductible to get replacement equipment. The deductible here should be cheaper than Chinese products. That’s the only way they’ll buy insurance.”

Free repairs and insurance policies.

Surprisingly, these were policies implemented by some large corporations before the Great Cataclysm.

But after the Great Cataclysm, no one implemented these policies.

It was simply because of immediate profit and loss concerns.

However, after some time, the American Blacksmith Guild would implement these policies and grow explosively because of them.

‘Once the quality of supplied equipment becomes somewhat similar and stabilization occurs, it ultimately becomes a battle of service and marketing.’

So if someone was going to implement it anyway, we might as well do it first.

That way, we could make a strong first impression on people through first-mover advantage.

However, both Jang Hae-hyeon and Han Yu-won were skeptical about the insurance policy.

“Even with deductibles, wouldn’t the company losses be significant if we give out equipment for free?”

“There would probably be people who abuse it too.”

“That’s possible.”

“What?”

“It might seem like we’re taking losses immediately. But through these policies, we can build a Daesan ecosystem among hunters.”

“An ecosystem?”

“You know those people who only use one brand. It’s a tendency that’s particularly prominent with phones, tablets, and laptops, and I think the same applies to item equipment. People care more about design than you’d think. Why else would the term ‘color coordination’ exist?”

“But would an ecosystem really be built just because of design issues?”

“Just design? Product visuals occupy a much more important part than you think. And along with design, you’re overlooking one very important fact.”

“An important fact?”

“Yes, the growth of hunters.”

“The growth of hunters… Ah!”

Jang Hae-hyeon’s eyes widened.

Choi Hyun continued his explanation.

“Hunters grow. Especially new hunters who haven’t been hunters for long grow quickly. So here, I recommend two more policies. The first is a reward policy.”

“A reward policy?”

“Yes, for those who purchased insurance, when they return their used equipment, we provide an appropriate level of discount when purchasing the next tier of equipment. The key point here is not giving rewards in money, but providing discounts when purchasing the next tier of equipment.”

“I see! That way they’ll naturally use our Daesan products for the next tier too.”

“Exactly. This way we naturally provide continuity and build an ecosystem.”

The two people felt dazed as if they had been hit on the back of the head by Choi Hyun’s idea.

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This chapter was translated by Lunox Team. To support us and help keep this series going, visit our website: LunoxScans.com
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