Fan Li

Fan Li (Chinese: 范蠡; pinyin: Fàn Lǐ^[1]) from the Spring and Autumn period, was a prominent Chinese statesman, military strategist, diplomat, economist, philanthropist, Taoist, founder of Chuism (楚学), and the founding father of Chinese commercial business. He was born in 517 BC^[2]. He is considered the wealthiest citizen in the five thousand years of Chinese history. He famously became extremely wealthy three times, and each time gave away everything he had. Thus, he is known as the first and most charitable person in Chinese history. He was a prominent member of the Fan family, and is worshipped as a "God of Wealth" by the Chinese. Xi Shi, considered among the most beautiful Chinese women ever born, is said to be his lover or wife.

Fàn Li was an important political and military advisor for the State of Yue and a Chancellor of the State of Qi. He is also known by the name Tao Zhu Gong（陶朱公） which he took after achieving a decisive victory for the State of Yue over the state of Wu and retiring to live a secluded life.

Biography

Fan Li traced his lineage to Emperor Yao (帝堯). Emperor Yao was a 5th generation descendant of Emperor Huang (or the Yellow Emperor，黃帝), and the second son of Emperor Ku (帝嚳).

Along with King Goujian of Yue, Fàn Li was once a hostage of the state of Wu. After three years of captivity the two of them returned to Yue where Fàn Li helped Goujian carry out a host of reforms to streamline the administration of the Yue state. In 493 BCE, Yue was finally able to destroy the state of Wu. After the victory, Fàn resigned and renamed himself Tao Zhu Gong Chinese: 陶朱公; pinyin: Táo Zhū Gōng). After his departure, he was said to have written a letter to Wen Zhong from Qi, advising Wen Zhong to leave Goujian's service, but Wen refused; Wen was later forced to commit suicide by Goujian.

In his later years, he became a legend for his success in business, posthumously becoming a Saint of the Chinese money god, or the God of Wealth (Cai Shen), who is worshiped by the Chinese on the Fifth Day of the Chinese New Year. After retiring from his ministerial post he lived with Xi Shi, one of the renowned Four Beauties of ancient China, on a fishing boat, roaming the misty wilderness of Lake Tai in the style of the Taoist immortals of old.

Fàn Li is an ancestor of Fàn Zhongyan (范仲淹), a famous chancellor and historical figure from the Song Dynasty. ^[3]

Business

Fàn Li began his business ventures by establishing a pharmacy selling traditional Chinese medicine. The pharmacy originally included only two elderly employees, "Uncle He" (何伯, Hé Bó) and "Uncle De" (德叔, Dé Shū). However, the business began to expand substantially after Fàn hired He Bo's youngest son, "Junior Wen" (小文, Xiăo Wén).

Beliefs

Fàn Li believed that one who understood money would be willing to abandon it if it became a burden. and that currency was only a means to an end. Although he felt money should not be taken too seriously, he wrote that it must be handled and acquired according to a set of principles. He outlined these principals in his writings on successful business management. Fàn Li urged a somewhat flexible execution of these principles and encouraged a utilization adapted to the nature of the situation.

Publications

Fàn Li wrote many classic books on the art of successful business management including The Art of Fish-Breeding (t 養魚經, s 养鱼经, Yǎngyú Jīng), the earliest known work on fish farming and the Golden Rules of Business Success (t 經商寶典, s 经商宝典, Jīng Shāng Băo Diăn). The latter book remains very popular today and outlines the 12 principles and 12 pitfalls of business management.

Golden Rules of Business Success

The Twelve Golden Rules are as follows:

Ability to know people's character. You must perceive evidence of characteristics from experience.
Ability to handle people. Never prejudge a prospect.
Ability to stay focused on the business. Have a definite focus in life and business and avoid jumping around.
Ability to be organized. A disorganized presentation is unappealing.
Ability to be adaptable. Make sure you are organized enough to respond quickly.
Ability to control credit. Do not allow nonpayment. Make sure you collect what is owed.
Ability to use and deploy people. Use employees in ways which bring out their potential(s).
Ability to articulate and market. You must be able to educate customers on the value of goods.
Ability to excel in purchasing. Use your best judgement in acquiring stock.
Ability to analyze market opportunities and threats. Know what is selling according to areas and trends.
Ability to lead by example. Have definite rules and standards. Make sure they are followed to ensure good relations.
Ability to have business foresight. Know market trends and cycles.

The Twelve Golden Safeguards are as follows:

Don't be stingy. Never confuse efficiency with inhumanity.
Don't be wishy-washy. Be confident in pursuing opportunities. Time is of the essence.
Don't be ostentatious. Do not overspend in order to make an impression.
Don't be dishonest. Truth is the only basis for business. Without it someone will get hurt.
Don't be slow in debt collection. Without collections, liquidity is affected.
Don't slash prices arbitrarily. This will only trigger a price war in which everyone will lose.
Don't give in to herd instinct. Make sure the opportunities are real and not part of a craze.
Don't work against the business cycle. When things fall in price, they will then rise and vice versa.
Don't be a stick-in-the-mud. Keep up with things and make progress. Examine new things objectively.
Don't overbuy on credit. Credit is not license to spend wildly.
Don't under-save (keep reserve funds strong). When business is slow, one with money can expand while others close.
Don't blindly endorse a product. Make sure your vendors are still following standard operating procedure.

Cartoon versions of this book are widely available in China, Hong Kong, Taiwan, and Singapore, both in Mandarin Chinese and in English. The Mandarin version includes Hanyu Pinyin and an English translation for each of the original business principles.^[4]

References

^ 我的趣味汉字世界1 (in Chinese). 接力出版社. 2014. p. 147. ISBN 9787544835350.
^ Wang, Robin R. Yinyang: The Way of Heaven and Earth in Chinese Thought and Culture. Retrieved 12 April 2015.
^ Yen, L.D.H.C.H. (2013). Ethnic Chinese Business in Asia: History, Culture and Business Enterprise. World Scientific Publishing Company. p. 262. ISBN 978-981-4578-44-8. Retrieved 2017-06-25.
^ "Golden Rules-Tao Zhu Gong's Art of Business". Asiapac Books. Retrieved 12 April 2015.

Records of the Grand Historian, volume 41