Trading with Chinese companies

A message from David re: China and trading.

Many people these days express concern about the ethics of trading with China, given the growing number of human rights issues in that country. Oppression of both Christians and Muslim people, Taiwan, Hong Kong, issues in the South China seas, covering up the early covid cases etc etc - there are so..so many issues.. it's not surprising I often get asked if we are comfortable trading with such a country?

Some would even advocate not trading with China at all in order to bring pressure on China to do the right thing. I will argue here that in the gift trade dealing with predominantly small family businesses, real families real people that we know (and have know for years) that would do more harm than good. And that ethical trading is actually a strong and often essential force for good.

But first, I'd like to make a full disclosure, and regular readers of my newsletter will already know this... My wife is Chinese and readers will know is also our incredible hard working China agent, dealing day to day, hands on with all our many China suppliers. We have our own warehouse and offices in the city of Yiwu. We also have an apartment in a beautiful development, where Coco (her Chinese name is Jie Shuqin) lives with her son and wife and two grandchildren. Dundun, her son manages our Soywax candle factory, we are proud to say the first purely plant-based candle factory in Yiwu.

So a short background story... years ago like most China importers we employed a local China agent. For the sake of discretion we will call him "Mark". Mark we paid well, gave his family business (crystal blocks - remember them) as much business as possible, he had a generous percentage. Confident he was making good money we trusted him implicitly to work in the best interests of AW. After all that is the very definition of an agent. The thing was our friend, Mark was not exactly straightforward and honest- and later we learned that we'd place an order with company we liked only to find that he had moved the order to another company (secretly).. quality was always an problem, and supply lines were slow and strained. In the end (as we found out these things) the relationship broke down and Coco stepped in to save the day. It was a big mess, computers went missing, invoices shredded etc, but when the dust settled we found not only could we buy at least 20% cheaper but suppliers tears in eyes, were so much happier to deal in a straightforward way. And so much happier to focus on the product and quality rather than kickbacks and favours.

Maybe Mark was just dodgy, but it is also plain to see that the corrupt influences would affect his actions. Like a secret club where you trade favours, all in the mistaken misguided belief that it was in some kind of nationalist Chinese benefit.

Well after this trama and Coco took over, the sun came out. Business bloomed. Now we could develop real relationships with suppliers, check they had fair and good staff policies. Work with them to make great products. They were happy, we could work with them. The product became the thing. Everyone happy.

At AW we don't take trading ethics lightly, and have always (for over twenty years) put considerable effort and thought into how we can trade more ethically.

Apart from China we import from India, Indonesia, Nepal and Morocco. And every market has difficult and different issues that need carefully addressing. And we do care about these things.

In the case of China it is really important to distinguish between the good hard working people of China and the CCP (Chinese Communist Party) . The CCP is the organisation that runs China and is really responsible for all the human rights abuses listed above. It has to be noted even within the CCP there are good and bad influences, and the improvements in China (millions lifted from poverty, amazing health system etc) are down to the good people. Since there is no democracy, the people are not able to vote to change the bad people in governments - like in the west. So. I would argue it is incredibly unfair to hold ordinary people responsible.

Fair trading with family businesses.

At AW we deal almost exclusively with small family businesses, we check that they are decent people, that staff and contractors are treated fairly and have good working conditions. We ensure that no prison labour is used in any of the supply chain, and of course no child labour. In the future we may also ask if company owners are members of the CCP.

Yiwu - an international trading city

Our office and warehouse is located in the city of Yiwu. It is a polyglot city, people from every region of China come here to do business. People normally (before covid) from all over the world come here to trade. The city has the world's largest permanent exhibition building with a massive 75,000 plus showrooms. This Youtube video gives you an idea of the place.

Yiwu is an interesting place, mosques and churches, every type of restaurant including Uighurs food, one of my favourites. Uighur muslims might be persecuted in their home province but in Yiwu they at least appear to be completely free. Coco comes from a Christian area of China and often attends a Christian church in Yiwu.

So our first hand experience certainly in this area is not of any kind of oppression.

Even so - please be assured as in all countries we trade we take care to get to know our suppliers well, and ensure high ethical standards.