Chapter 93: An Unexpected Rhythm

Upon hearing of the passing of Master Yu Guangzhong, Lu Yu was momentarily moved, yet he was not one prone to sentimentality. Moreover, Deng Qiang would not permit him such indulgence. With the Western Christmas approaching, the products of Rose-Pale Ebony Company were about to launch their overseas publicity campaign. At such a critical juncture, Deng Qiang hoped Lu Yu would be present at the company to lend his support. Even if he did not directly command operations, his mere presence would serve to steady the team. Furthermore, Deng Qiang was awaiting Lu Yu’s arrival to formally announce that 0.9% of profits would be allocated to the bonus pool. Previously, incentive measures had been set, but the official announcement had yet to be made. Having Lu Yu deliver this news would undoubtedly inspire the company’s staff.

It must be said, under Deng Qiang’s management, Rose-Pale Ebony Company’s systems grew ever more refined, marching quickly toward the ranks of top-tier enterprises. Lu Yu held Deng Qiang’s abilities and attitude in high regard, and thus agreed to spend the coming days working regular hours at the company.

The company was especially busy of late, particularly the publicity department, which had expanded rapidly, hiring many with extensive international media experience. Documentaries tracking all foreign trial users had been filmed, with all footage sent back to headquarters. Editing was underway, with select segments being crafted into promotional shorts. Deng Qiang sought to dazzle Western consumers, and these shorts were crucial. For if no one was intrigued by the trailers, few would spend time watching the full-length documentaries.

To this end, Deng Qiang had contacted Ogilvy International’s domestic branch, requesting that the headquarters dispatch a team to oversee the entire marketing plan. Ogilvy International, officially known as Ogilvy Public Relations International Group, encompasses numerous subsidiaries in diverse fields—Ogilvy Advertising, Ogilvy Interactive, Ogilvy PR, and more. It is among the world’s preeminent marketing and communications companies. The reason for not choosing a domestic media or advertising giant was simple: Rose-Pale Ebony’s campaign was targeted abroad, and the local firms lacked relevant resources and experience. Foreign consumers’ mindsets and perceptions differ greatly from those at home; to better align with overseas markets and build the brand image, Ogilvy International was the optimal choice.

To heighten the impact, the company and Ogilvy also signed stringent confidentiality agreements, preventing premature leaks. Though Ogilvy’s fees were steep—indeed, even high—after reviewing their preliminary plan, Deng Qiang did not hesitate.

Ogilvy’s team, considering the unique qualities of Rose-Pale Ebony’s products, decided to shape the company’s image as one of mysterious elegance from the ancient East. In the eyes of most Westerners, the land of Cathay has always been shrouded in mystique—years ago, thanks to kung fu icon Bruce Lee, many believed every Chinese was a martial arts master. After all, wasn’t it common to see elderly folk practicing Tai Chi in parks nationwide? If the old were so adept, the young must surely be formidable, able to defeat ten at once!

Despite the rapid development of the internet in recent years, Westerners’ understanding of China remained limited, often one-dimensional. Thus, Ogilvy’s team seized upon traits such as antiquity, mystery, elegance, and nature. Curiosity is innate to humanity, and mystery stirs a strong desire to explore. The more enigmatic, the greater the urge to uncover the truth.

Upon arriving at the company, Lu Yu carefully reviewed the promotional plan drafted by Ogilvy’s team. Though he was no expert in marketing communications, the proposal was comprehensive, meticulously considering every facet, and justified the hefty price tag. Lu Yu offered no objections; the greatest danger lies in those ignorant of the field meddling with professionals. Besides, with the campaign imminent and many channels already secured, any sudden changes could cause unnecessary complications.

He advised Deng Qiang to follow the plan as it stood; the products’ competitiveness was clear, and there was no need for excessive worry. Nothing is perfected in a single attempt—if results proved less than ideal this time, there would always be another opportunity. Harvesting profits is a long-term process; with so many foreign consumers, it could not all be done at once—patience was key.

As Lu Yu and Deng Qiang discussed strategies for maximizing profits, they failed to realize that attention had already turned toward Rose-Pale Ebony. This time, the focus came from “Southern Business Journal.” With year’s end approaching, many media outlets began compiling annual news reviews, highlights, and predictions for the future. “Southern Business Journal” was no exception, releasing a special edition summarizing major domestic business events of 2017, with one article devoting considerable space to Rose-Pale Ebony Company.

The piece drew much attention and debate online, thanks to impressive results and the company’s uncertain future direction. According to the journal’s data, since the product launch, cumulative sales had exceeded forty billion yuan—a staggering figure, placing it within the top five hundred private enterprises domestically, based on the 2016 revenue rankings. Those companies had all achieved their positions through years of development and operation, whereas Rose-Pale Ebony accomplished such feats in just one year, making it impossible to ignore.

Despite the high sales income, the funds Rose-Pale Ebony could actually deploy were quite limited. As a sole proprietorship, the company paid no corporate income tax, but personal income tax applied, subject to a progressive rate from five to thirty-five percent. Given Rose-Pale Ebony’s earnings far exceeded one hundred thousand yuan, the maximum thirty-five percent rate was required. As a general taxpayer, the company also paid seventeen percent value-added tax. Because the products had low costs and high profits, VAT constituted a major tax burden. Other taxes included surcharges—urban construction fees at seven percent of VAT, education surcharges at three percent, and local education surcharges, among others. While raw materials, plantations, and processing centers allowed for some VAT deductions, it was not substantial given the high profits.

In summary, Rose-Pale Ebony’s taxes, together with employee benefits and other fees, amounted to nearly half of gross revenue. Though recent investments in plantations and processing centers allowed for partial VAT deductions, combined with operational and labor costs, limited capital was entirely normal.

Yet ordinary people paid no heed to such details, seeing only the dazzling income. “Southern Business Journal” either intentionally or inadvertently glossed over these aspects, but did recount Rose-Pale Ebony’s investments in thirteen plantations and processing facilities. These had all been reported in local news at the time of contract signing, and though few paid attention, anyone could easily verify the facts. Having listed these investments, the journal then launched into extended analysis.

From June onward, production and sales of Rose-Pale Ebony’s facial masks and shower gels had remained steady. Only in August did the launch of the new anti-wrinkle Unqi Essence contribute over a third of sales income. After half a year of preparation and planning, supply chain issues had been resolved, and production scale was expected to expand in the coming year. The article speculated that with increased output, Rose-Pale Ebony might plan to venture overseas.

How others viewed things Lu Yu could not say, but he found the article irritating upon seeing it online. The internet was already rife with keyboard warriors, always searching for problems where none existed, eager to cry foul. Could he not be allowed to earn his money in peace? “Southern Business Journal,” too, with so many excellent companies at home, chose to focus obsessively on his cosmetics firm, devoting more space and detail than Deng Qiang’s work reports ever did. Lu Yu had not authorized any publicity, nor had he paid them for their efforts—so why were they so zealous?

They insisted on placing the company under the public eye, as if afraid no one would notice. Had they accepted a bribe from competitors?

As Lu Yu anticipated, the article soon sparked online debate about Rose-Pale Ebony’s tax affairs. Many even tagged tax authorities and relevant departments. Lu Yu needed no guesswork to know this was the handiwork of rivals. Truth be told, few companies in the country could withstand a thorough tax inspection—large or small, most had some tax issues, differing only in degree. Legitimate tax avoidance was common and permitted, but this often served as ammunition for competitors, stirring up controversy to tarnish reputations.

Given that Rose-Pale Ebony was a sole proprietorship, some self-appointed online crusaders, seeing themselves as the embodiment of justice, clamored for the “light of righteousness” to shine across the land. The controversy only grew more heated.

Deng Qiang soon learned of the online uproar and sighed inwardly. As an insider, he could easily deduce the cause and effect. This wave of agitation was undoubtedly fueled by both domestic and foreign competitors. He lamented that, after so many years of failing to surpass foreign giants, domestic peers now sought to disrupt matters just as Rose-Pale Ebony was preparing to venture abroad and compete for market share.

Yet such behavior was only human; the company’s rise had inevitably harmed vested interests. As a private enterprise, refusing acquisitions and shareholding, taking a large bite for itself, it was bound to provoke envy.

Deng Qiang reasoned that clarifying tax matters early was best, since rumor can be powerful. He visited Lu Yu’s office to discuss strategies, then returned to arrange the necessary steps.

Soon thereafter, Rose-Pale Ebony’s official accounts issued a unified statement: three simple question marks. Beneath, they attached tax declarations from the previous two quarters, making the company’s tax payments crystal clear. They tagged several active marketing accounts and individuals.

With this official response—especially on social media—the onlookers were left speechless. The reason was simple: the tax payments were entirely transparent, all made according to relevant policies, without even legitimate tax avoidance. The only reductions stemmed from preferential policies granted by local authorities in Sichuan and underdeveloped regions, all within legal bounds. The company paid exactly as required, not a cent less, leaving no grounds for criticism.

This had been Lu Yu’s principle from the start: with profits so high, there was no need for tax avoidance or evasion, nor to leave anyone ammunition. To be candid, he personally never doubted future opportunities for profit. His motivation for wealth was to build research institutes and science parks to advance technology. For personal use, he had long had enough; everyday expenses were minimal, and saving on taxes was neither worth the trouble nor necessary.

It was not only a matter of preserving reputation, but fulfilling the responsibilities and obligations a company ought to bear.

With no drama left to witness, the crowd each left a single word: “fool,” liked the post, and quietly dispersed.