Creating an Industrial Empire in 19th Century Parallel World -
Chapter 12 Practicing The Pitch Before Demonstration
Thanks to Mister Morgan, one of the richest financiers of the United States of Avalonia, the Axelsen & Nielsen Air Brake Company finally landed an opportunity to demonstrate and promote the air brake and the locomotive draft gear.
The day after they received the call, Poul didn't waste any more time and immediately went to one of the steam locomotive factories in Ohio to retrofit one of their trains with air brakes and the locomotive draft gear. With the help of 20 workers he handpicked, they were able to finish retrofitting the train in less than three days. Poul also taught the locomotive driver how to use the air brake and gave him a 15 dollars reward for successfully learning it.
With that aside, Poul returned to the factory and discussed with Jonathan how he is going to pitch the product to potential investors and customers.
"There are about forty steam locomotive accidents per year and ninety percent of them were caused by a lack of an efficient braking system. Now, you might be wondering, is there a way to reduce that ninety percent to zero percent?" Poul asked, waving his hand dramatically as he practiced his pitch in front of Jonathan.
Poul continued. "Yes. Introducing…the air brake!" he announced, pulling the string that pulled the curtain up, revealing the detailed schematics of the air brake. "So how does it work? We use compressed air. In this figure, we can show to you the simple mechanism of how compressed air is used to stop the train. There is a wheel, a brake shoe, a lever, and a piston rod. We put compressed air into the system, pushing the piston rod, which pivots the lever, and then pressed the brake shoe against the wheel. From there, it is simple physics, the mechanical energy of the wheel is converted to thermal energy due to friction, thus slowing the train down." Poul concluded, wiping the sweat forming on his forehead with the back of his arm.
"So, what do you think?" Poul asked.
Jonathan crossed his arms and hummed in thought. "Well, you perfectly explained the simple mechanism of the air brake. Yay, it's impressive but you are going to present to a businessman here. They are not interested in science lessons, they are interested in how they are going to make money," Jonathan shared his opinion. "Now that I think about it, our technology does not provide them with extra income, they are an added expense. In a society where there are no labor laws, and company owners not caring about their workers. So, the ultimate question is, how are you going to sell a device to protect a worker from possible death where the company owner doesn't care about them in the first place?"
Poul was silent at Jonathan's words. He looked down at his feet, shuffling his feet awkwardly. He had a point and he realized it just now. The company owners, or synonymously, Robber Barons, don't care about the safety of their workers. They only care about the money going into their pockets. He pondered for a solution to answer Jonathan.
"Damn…you are sounding like a businessman here, Jonathan. I thought you don't like technopreneurship."
"I don't like it," Jonathan said in affirmation. "But it doesn't mean I wouldn't exert efforts into learning the concepts and lessons it has to offer," he coolly said.
"Well, if they don't care about their workers and prioritize profit. Then let's take a look at the statistics here," Poul came up with an answer and elaborated on it. "Normally, a railroad company would hire five to six brakemen for a steam locomotive pulling ten to fifteen cars. Each day, they receive about a dollar and a fifty for their work. That's ten and fifty dollars per week, 45 dollars per month, and 546 dollars per year. Remember, that's only for a single train. A railroad company is operating at least 100 to 200 steam locomotives.
"So in total, you will have to spend 109,200 dollars paying brakemen per year. That's a lot of money that can be used for research and development, funding new enterprises, and so on. Not only that, the brakeman's job is dangerous where death is possible. A death under one's company is not a good optic. Not to mention, it was only the lives of the brakemen we are talking about here, we are not including the passengers yet. They are the important ones because they are the primary customers. In addition, building a steam locomotive is expensive, costing at least 270,000 dollars. Losing one train because you can't brake in time is a serious blow in the face," Poul finished and Jonathan was nodding his head, convinced by his words.
"Good, if I were one of the owners of railroad companies, I would surely consider installing air brakes in my trains. How about the locomotive draft gear? Do you have any marketing strategy to pitch it?"
"Well, comfort is important in the train because it gives your passenger a better sense of safety and stability when they are riding the train. You have to provide that, at some point along the line. Also, not only they are carrying passengers but also goods that are fragile and sensitive to shocks."
"Okay, I'll let you be the one to think of that. Now moving on, to the important part. How much do an air brake and locomotive draft gear cost?" Jonathan asked.
"The price for the air brake is 50 dollars per car and for the draft gear, 35 dollars per car."
"50 dollars per car. And normally, a passenger steam locomotive has around 10 to 15 cars. So a company would cost 850 to 1275 dollars to retrofit a single train with air brakes and draft gear. And assuming that a railroad company operates 100 steam locomotives, it would be 85,000 dollars. Much cheaper than paying the five brakemen per year. What's more important is that it's only a one-time purchase," Jonathan said.
"Now you are getting it, " Poul chuckled as his heart rate rose with excitement. Feeling that the pitch would work well in the actual demonstration. "Oh, did I mention that it will prevent unwanted accidents? If I did, that's another huge factor in helping them decide."
"Okay, now you know how you are going to market our products. The last challenge now is how are you going to keep up with the demands. If they like it, they would surely buy it. But we are a small company, so we need to up our game. How are we going to attract investors?"
"I'm sure with the numbers we discussed, they can calculate how much the company is going to profit from this. I'm approximating five to fifteen million dollars. It's only in the United States. We can expand our business in another country, particularly in Europe. So around twenty-five million to forty million dollars?"
Jonathan was feeling dizzy hearing Poul's estimates. Is that how much this air brake industry works?
"And once we get that money, we can expand to another venture. Electricity, oil drilling and refining, steel manufacturing, automotive, aviation, and heck, we can even start our railroad company. Imagine it, Jonathan!"
Jonathan was in a daze after hearing all those numbers coming out of Poul's mouth. His eyes lit up, while his mouth slightly opened. "Okay, you convinced me. Geez, you are an overpowered person in this world."
"You too as well, Jonathan. In fact, you can start your own civil engineering firm if you want to," Poul said.
"No, not yet," Jonathan replied, shaking his head as he started to pace around the lab and stopped to look out at the window. "Let us focus on this one first.
Poul walked over to him and sat beside him. He placed his arm around his shoulder and spoke.
"We will brother. This new world provides us a great opportunity to start over again, we will not waste it, and leave a legacy before we die."
Jonathan chuckled, feeling uplifted by Poul's words. "Yeah. Get them, brother,"
"Leave it to me."
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