Chapter 1358: Industrial Standards
Joseph gestured for the Minister of Transport to get into the carriage, asking with a hint of confusion, "Who were those people, to have the power to influence our nation's income?"
The carriage started moving again. Theresa glanced north, stating nervously, "They are officials from various countries, and nobles, Your Royal Highness.
"As you know, almost all countries are currently planning to purchase licenses for our railway patents, but they don't want to spend so much money.
"So, they intend to collectively appeal to you to lower the licensing fees.
"Among them is even your brother-in-law, Prince Ludovico; you might find it difficult to refuse them..."
Joseph smiled faintly. "Did Baron Binder rally them here?"
Binder was the Assistant Foreign Minister of Baden.
Theresa shook his head. "He merely leaked the news that you would be passing through Karlsruhe, and then those people gathered to discuss requesting a discount from you."
"Hmm, they're quite sharp," Joseph said, waving his hand dismissively. "Originally, I had intended for Baron Binder to bring them to me."
"It's fine. Patent licensing is only a small part of our future income."
Theresa immediately grew anxious. "Your Royal Highness, I know your benevolence makes you wish to grant everyone a good life, but this will cost us tens of millions of francs in revenue."
As he spoke of this, he recalled many recent incidents that had left him feeling 'unsettled'. "You see, the high-end equipment we sold during the Expo, such as lathes, fire extinguishers, and cranes, would still be purchased by many, even if we tripled their prices.
"I estimated that in just over a week previously, we lost out on millions of francs, and now you intend to do the same with railway patents..."
Joseph interrupted him with a smile. "Did Count Mirabeau not tell you?"
"Ah? He didn't mention anything specific."
Joseph nodded. "Thank you for diligently protecting the interests of France. And thank you to Count Mirabeau for his discretion."
He looked at the Minister of Transport. "But lowering prices, whether for machinery or railway patents, will actually only increase our revenue."
Theresa's eyes were filled with disbelief.
Since there was nothing else to do on the road, Joseph began conversing with him. "You must adopt an industrial age mindset."
"I... I don't quite understand, Your Royal Highness."
"Control the market, define market usage habits," Joseph said, then asked, "How much does our new model lathe sell for?"
"I recall the lowest price is twenty thousand francs."
"It could actually be even lower," Joseph stated. "If, as you suggested, we raised the price to sixty thousand francs, how much do you think sales would decrease?"
"About half, perhaps a little more, but the total sales revenue would be much higher."
"Precisely. And those buyers unwilling to pay that much would then go to the market looking for similar products. This would spur factories in various countries to desperately imitate our machines; even if the quality were slightly lower, people would still buy them for the cheaper price.
"Now, we are directly blocking all profit margins for counterfeit products. Practically all factories with a demand will use our equipment.
"Even if someone else manufactures equipment with equivalent performance in the future, factories will refuse to switch simply because they are accustomed to using our products."
Joseph truly wanted to tell him about the audacious tactics of a certain company in later generations—how they would even give away products for free, not just sell them at a discount, to dominate the market for decades.
"And while our equipment is inexpensive, we can earn the deserved profits through continuous sales of accessories, as well as upgrades and maintenance.
"You see, for luxury items that cannot profit from accessories, we will try to maximize their selling price."
Theresa's eyes were wide, and he felt as though the Crown Prince was the cleverest merchant in the world... no, the most brilliant man in the world.
Suddenly, he thought of something else and quickly said, "Your Royal Highness, in the railway sector, we are licensing all production technologies, including the smelting and forging of iron rails, as well as fishplates, rail supports, and bolts, to various countries. This means they won't need to purchase our accessories at all."
Joseph nodded. "That certainly seems to be the case. This will compel all nations to invest their utmost efforts in railway construction once they obtain the license.
"However, most countries lack iron ore or coal mines; they will, at the very least, need to import high-quality iron ingots from our nation.
"Furthermore, we have not sold our steam forging machines. The forging efficiency of these machines far surpasses hydraulic forging presses, which means the cost of our manufactured iron rails is only a fraction of what other countries can achieve.
"So, apart from countries rich in domestic iron ore that can be self-sufficient, most iron rails will still need to be purchased from our nation.
"As for rail supports, bolts, and the like, our nation's products, thanks to alloy steel and precision machining, are unrivaled in quality, and their sales will likewise remain high.
"In truth, even if all countries truly smelted their own steel and laid their own iron rails, we could still earn tens of millions of francs simply by selling the steam engines, bearings, and other components used in trains."
Joseph observed Theresa nodding continuously, then added,
"Moreover, the influence of railways is incredibly broad; it's not just about generating profit. It also concerns our control over industrial standards, which, in turn, brings immense technical authority and even diplomatic influence."
Theresa's train of thought was starting to fall behind. "Industrial standards... can also be controlled?"
As the Crown Prince broadly outlined the importance of controlling industrial standards, Theresa suddenly frowned. "Your Royal Highness, as you've explained, while our nation controls industrial standards, this process will also accelerate the industrial development of other countries. Perhaps one day, a nation will emerge that could threaten us."
"I perfectly understand your concern," Joseph nodded, then shifted the topic. "Let's imagine, if you were to invest in opening a shop, would you prefer to open it in Paris or Foix?"
Foix was one of the poorest provinces in southern France.
Theresa replied without hesitation, "Paris, of course, Your Royal Highness."
"Tell me your reasons."
"It's obvious; Parisians are wealthier, so opening a shop there would earn more money."
"Indeed," Joseph said. "The same applies to France.
"We must not only control as many markets as possible but also find ways to make them wealthier, so they can purchase large quantities of the goods we produce.
"As for threats, with our nation dominating technical standards, other countries will find it very difficult to acquire complete industrial capabilities."
As the two spoke, the faint sound of melodious music drifted from the end of the road.
Joseph pointed to the carriage door, smiling at the Minister of Transport. "To avoid suspicion, you'd best disembark ahead of time."
More than ten minutes later, the convoy slowly came to a halt. Hundreds of officials and nobles from various countries immediately gathered around, bowing in unison towards Joseph's carriage.
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