Lu Guanqiu is arguably modern China’s ‘debut’ entrepreneur, and in keeping with his stature as the nation’s first capitalist is a very rich man. He’s worth Rmb18.5 billion ($2.7 billion), according to the 2008 Hurun wealth ranking. But he was born dirt poor in the agricultural village of Ningwei in Zhejiang province and left school at 15 to become a blacksmith’s apprentice.
In 1969 the Ningwei Commune asked Lu to take over its farm machinery repair shop. The factory was an 84 square metre shabby mess, but from such things are great fortunes built. He sold all his belongings, built a house next to the plant and injected Rmb4,000 – staking his entire fate on its success. He specialised in making universal joints and branded his product Qianchao. He took local market share by refusing to raise prices and ratcheting down costs – something his less aggressive competitors found tough to match.
Lu’s firm – the Wanxiang Group – began participating in trade fairs (like the famous Canton Fair) and began to develop new varieties of joint. Soon he was selling in 18 countries. In 1994 he got permission from the Ministry of Foreign Trade to set up a company in the US.
Need to know
Wanxiang is China’s biggest auto parts manufacturer. The company has diversified into various fields including mining and has 22 companies in 10 countries. In 2008 his 21,000 employees helped Lu make revenues of Rmb47.5 billion.
In 1999 Lu set a target to make daily profits of Rmb10 million by 2009, which has been achieved. He has now set a new ’10-fold in a decade struggle’ plan: by 2019 he wants to be making Rmb100 million of daily profits, with his best paid employee earning Rmb100 million annually.
Lu is up by 5.10am. Staff prepare 30,000 words of reading materials for him from the major press and on auto industry related subjects. According to the Today Morning Express he has a 10 square metre office – probably the smallest among his billionaire peer group in China.
In his own words
“My mind is filled with business. I do not play golf and have no love for luxury. Buy a yacht? I can afford it, but I won’t. Human life is limited, so you have to seize the time to work.”
And to relax…
Work. “Sitting in front of a desk, I feel ease in my mind!” But when he does have spare time he works on his ‘four-10,000’ charity which helps large groups of orphans, poverty-stricken students,children with disabilities, and the elderly.
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