The faint light of the early morning struggled to penetrate the thick clouds, bringing a hazy glow to Shen Ruoxin's small embroidery house. The air was still filled with the coolness of autumn, but in Shen Ruoxin's heart, it seemed as if a fire was burning, with both anger and a certain kind of cold determination after seeing through the truth.
The discovery in the main accounting room last night was like a bolt of thunder, splitting the turbulent undercurrents beneath the seemingly calm surface of the Shen family. The eldest brother Shen Zhongkang and his stepmother Liu Shi are not only eyeing their mother's dowry but also systematically and through seemingly legal business operations, they are eroding the foundation of the Shen family - the Jinxiu Ge Silk and Satin Store.
Those overstocked high-end silks, the inflated purchase prices, the abnormal transportation costs, and the absurd cotton, linen and cloth trade with the brocade and embroidery cloth store... Every doubt points to a terrifying conclusion: They have long been laying their own fallback plans, even at the cost of the Shen family's century-old legacy.
Just knowing these is not enough. Shen Ruoxin understood that to fight back, she needed more conclusive evidence and a deeper understanding of the true financial situation of the Jinxiu Pavilion. What she saw last night was only the accounts of the past three months. Although it revealed the tip of the iceberg of the problem, to comprehensively assess the losses and determine the true intentions of Mrs. Liu and her elder brother, she still needs data from a longer period.
Especially inventory. Hoarding a large amount of high-priced silk is extremely abnormal in itself. She needs to know exactly how long these inventories have been piling up? How much of their true value is left?
A concept repeatedly mentioned in a business course from her previous life gradually became clear in her mind - inventory turnover rate.
In simple terms, inventory turnover rate is an important indicator to measure a company's sales ability and inventory management level. The higher the turnover rate, the faster the sales speed of goods, the quicker the capital recovery, and the smaller the risk of inventory overstock. Conversely, the lower the turnover rate, the more it indicates that the goods are unsold, a large amount of funds are occupied, and the risk of inventory depreciation also increases accordingly.
For a commodity like silk, which is greatly influenced by the popular trends of style and pattern, an excessively low inventory turnover rate is even more fatal. A few years ago, a fashionable style might be ignored by people now and can only be sold at a significant discount, or even become a pile of worthless waste cloth.
If she can prove that the inventory turnover rate of Jinxiu Pavilion is ridiculously low and that the silk of considerable value on the books has already depreciated seriously, then the false appearance of "profit" of Jinxiu Pavilion will be exposed, and its real huge losses will have nowhere to hide!
Perhaps this is her breakthrough point!
However, to calculate the inventory turnover rate and make a vertical comparison, she needs the sales cost data and average inventory data of Jinxiu Pavilion in the past few years. This means that she has to take the risk again and obtain the earlier account books.
The only person who could help her was Liu, the accountant.
Shen Ruoxin didn't hesitate. She didn't even have time for breakfast. After a quick grooming, she quietly left the embroidery house again and headed towards the main accounting room.
This time, she didn't choose to climb over the wall but walked through the main entrance. She needed to test whether Liu's attitude had softened after last night's "warning", and whether Liu Shi and her elder brother had strengthened their defenses.
Unexpectedly, although the guard at the entrance of the accounting courtyard was still a trusted confidant of Lady Liu, when he saw her, he did not stop her as forcefully as he did yesterday. Instead, he looked at her with a complicated gaze and asked symbolically, "Second Miss, what is this...?"
My father is seriously ill and my elder brother is just starting to manage the family business. I'm worried about the complicated accounts and came to see if there's anything I can do to help. Shen Ruoxin's tone was calm and composed, carrying a natural concern. "By the way, I also want to double-check the transaction details between my mother's dowry property and the main family's accounts."
She deliberately linked "her mother's dowry" to "the main family's accounts", finding a seemingly reasonable excuse for her behavior.
The two servants exchanged glances, seemingly unable to figure out the background of the second young lady or the true intentions of the lady. After a moment's hesitation, they ultimately did not stop her.
Shen Ruoxin felt a little relieved. It seemed that Liu Zhangfang had not made a fuss last night. She pushed the door open and walked into the accounting room.
Liu Zhangfang clearly didn't expect her to come so early and so "openly". He raised his head in surprise, and the writing brush in his hand even stopped.
"Uncle Liu, good morning." Shen Ruoxin seemed as if nothing had happened and walked straight up to him. "Last night when I went back and thought about it, I always felt that some accounts didn't match up." To ensure accuracy, I would like to review the general ledger, inventory account and sales account of Jinxiu Pavilion for the past three years again.
Liu's face instantly turned a little pale. He subconsciously glanced in the direction of the door: "Second Miss..." This... I'm afraid this is not appropriate? All the past account books have been sealed and stored in the warehouse. Without the order of the master or the young master, they cannot be taken and read at will...
Father is seriously ill and it's hard to get orders. As for Big Brother, I'll go and talk. Shen Ruoxin interrupted him, her sharp eyes fixed on him. "Uncle Liu, you and I both know in our hearts that the accounts of the Splendid Pavilion are probably not just those problems we saw last night." If the root cause is not identified and the crux of the problem is not found, when the illness becomes terminally ill, even the gods will be unable to save it! At that time, what good will you and I end up with?
She paused for a moment, her tone slowing down a bit, with a hint of gentle persuasion: "I'm not trying to hold anyone accountable. I just want to figure out the actual inventory turnover situation of the Brocade Pavilion." For example, by dividing the cost of goods sold in the past year by the average inventory value at the beginning and end of the year, we can roughly know how many rounds our goods can be sold in a year. If this figure is too low, it indicates that our goods are not selling well and there are too many second-hand goods piled up in the warehouse. Uncle Liu, you are the old accountant. You understand this principle better than I do.
She simply explained the concept and significance of inventory turnover rate in a language that could be understood in this era.
A trace of shock flashed in Liu's accountant's eyes. He never expected that this recluse second young lady would actually know these business tricks! The algorithm she mentioned for "turnover", although slightly different from the way he usually calculates, upon careful consideration, does indeed hit the nail on the head!
Looking into Shen Ruoxin's clear and determined eyes, Liu Zhangfang's inner balance began to shake violently. On one side, there was the pressure from the Liu family and the eldest young master; on the other, there was the crisis of the Shen family's possible downfall, as well as the calmness and wisdom that this second young lady demonstrated, which was beyond her age.
After a long silence, Liu, the accountant, seemed to have made up his mind. He gritted his teeth and said, "Second Miss, come with me!"
He led Shen Ruoxin around rows of accounting cabinets and walked to the door of a small warehouse in the innermost part of the accounting room. There is a big copper lock hanging on the door of the warehouse. Liu, the accountant, unsteadily took out a set of keys from his bosom and opened the door of the warehouse.
A smell of old paper and dust hit me in the face. It was piled up with old account books covered in dust.
The account books of the Jinxiu Pavilion for the past five years are all here. Liu Zhanfang pointed at several wooden boxes with labels on them and said, "Second Miss, if you want to check, do it here." This place is secluded and not easy to be discovered by others. But... Do it as soon as possible! If caught by someone...
"Thank you, Uncle Liu!" Shen Ruoxin gave him a grateful look and immediately walked to the several wooden boxes. According to the labels, she quickly found the general ledger, inventory ledger and sales ledger of Jinxiu Pavilion for the past three years.
Without having time to dust herself off, she sat on the ground, spread the heavy account books on her lap, and by the faint light seeping in through the small window of the warehouse, once again buried herself in those cold numbers. Liu, the accountant, was nervously standing guard at the entrance of the warehouse, looking out from time to time.
Shen was still in good health. His elder brother had not yet fully intervened in the affairs of the silk and satin store. The business situation at that time should have been relatively real.
She quickly found the key data: the total inventory at the end of three years ago and the cost of goods sold that year.
Then, she rummaged through the account books from two years ago and one year ago, looking for the corresponding data. The further she turned back, the tighter her brows furrowed.
As I saw last night, since the eldest brother Shen Zhongkang began to get more involved in the affairs of Jinxiu Pavilion, the total inventory has been increasing year by year, especially the proportion of high-end silk has been growing larger and larger. However, the corresponding cost of goods sold has grown relatively slowly. Even last year, there was a slight decline!
What does this mean?
This means that the ratio of cost of goods sold to average inventory, that is, the inventory turnover rate, is decreasing year by year!
Shen Ruoxin took out the small abacus she carried with her (or silently calculated, adjusting according to the Settings), and began to calculate quickly.
Three years ago, the inventory turnover rate of Jinxiu Pavilion was approximately three times a year. That is to say, on average, the goods in the warehouse can be rotated once every four months. This is considered a relatively healthy level for the silk and satin industry.
Two years ago, this number dropped to 2.5 times.
By the end of last year, based on the calculation of the book data, the inventory turnover rate had plummeted to less than 1.5 times!
It can't even turn over once and a half a year! This means that at least more than half of the goods in the warehouse are second-hand goods that have been piled up for over a year! Even longer!
Shen Ruoxin's heart sank. She continued to browse through the inventory details, with a particular focus on those high-priced items such as Yun brocade and kesi. She was shocked to find that many high-quality silks that had been stored in the warehouse three years ago were still lying intact on the inventory books!
Three years! It's been three whole years since the new model was updated!
For the ever-changing silk and satin industry, the styles from three years ago have long become a thing of the past! These silks still have their value recorded on the books at the inflated purchase price at the beginning, but their actual market value is probably less than 30% of the original price! It might even be ignored at all!
The inventory of the Splendid Pavilion is just a huge bubble! The seemingly huge assets on the books have actually depreciated significantly long ago!
Shen Ruoxin quickly made an estimate. If these high-end silks that have been piled up for more than three years are revalued at their actual potential cash value (or even lower), then the financial report of Jinxiu Pavilion last year was not at all a slight surplus as shown on the books, but a severe loss!
This loss amount is enough to shake the foundation of the Shen family!
No wonder! No wonder the big brother and the Liu family were in such a hurry to transfer the funds! No wonder they calculated her dowry at all costs!
They are very likely to have known the true situation of the Splendid Pavilion long ago! They are not operating; instead, they are accelerating the hollowing out of this ship that is about to sink! They need a large amount of cash to fill other holes, or... Prepare the capital for yourself to run away!
Then, the confidence that Liu showed yesterday in controlling everything and the eagerness to marry her off were more like a kind of... Bluffing?
Is she scared? Afraid that the hole in the Splendid Pavilion is too big to hold? Afraid that once her father passes away, she won't be able to fully control the situation? That's why they are in such a hurry to eliminate her, the "variable" who might be aware of it and cause trouble, and are in urgent need of the cash in her mother's dowry and that secret account box that might involve greater interests?
This speculation gave Shen Ruoxin a glimmer of hope.
If the Liu family is not as powerful and fearless as she appears on the surface, and if she is also facing huge pressure and crisis, then there might be flaws in her actions, and her alliances (such as with Shopkeeper Wang) might not be unbreakable.
Shen Ruoxin's mind was spinning rapidly, and the initial forms of one plan after another began to emerge.
She needs to verify this loss. She needs to let more people know the truth about the Splendid Pavilion. She needs to find the power that can contend with the Liu family.
And the most crucial thing at present is to protect oneself well, as well as... Protect these account books well! These cold numbers will be her most powerful weapon!
Second Miss, hurry up! It seems that someone is coming outside! The anxious voice of Liu, the accountant, rang out at the door.
Shen Ruoxin's heart gave a jolt. She immediately closed the account books quickly, stuffed them back into the wooden box, and then quickly smoothed out the dust around them, trying her best to restore them to their original state.
"Take the back door!" Liu Zhangfang whispered, gesturing for her to leave through an unremarkable small door at the back of the warehouse.
Shen Ruoxin nodded, no longer hesiting, and quickly slipped out through the small door. Then, taking advantage of the cover of the miscellaneous items in the corner of the courtyard, she quickly left the accounting courtyard.
Almost at the same time as her figure vanished, her elder brother Shen Zhongkang, accompanied by two managers, walked into the accounting compound with a worried look on their faces.
"Manager Liu, did you see your second sister come just now?" Shen Zhongkang's voice carried a hint of questioning.
Liu, the accountant, forced himself to stay calm and bowed, saying, "Yes, Young Master." The second young lady came to have a look at the accounts and care about the family business.
Shen Zhongkang glanced suspiciously at the account room and then at the tightly closed warehouse door. Finding nothing unusual, he snorted coldly, "She's just a daughter's family. What business does she know?" When she comes again later, let her come back to me first!
"Yes, yes. I've noted it down." Liu, the accountant, promptly responded, but a layer of cold sweat had already broken out on his back.
Shen Ruoxin hurried all the way back to her embroidery pavilion. She locked the door from the inside, leaned against the door panel, her heart still pounding.
It was really dangerous just now!