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ADVANCEMENT OF AMERICAN TRADE

INTERESTS IN CHINA

BY JULEAN H. ARNOLD, American Consul, Amoy, China

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advertises. Foreign trade to the average American merchant is still a sort of a romance. He would like to embrace the world as his market and carry upon the pages of his ledger accounts with foreign firms, but when it comes to the real business of soliciting this trade, filling their orders, financing his business with them, and retaining their patronage, this successful American home merchant apparently discharges the whole matter with a minimum of attention, with the result that the foreign firms find it to their interests to deal elsewhere.

Why, then, is it that the average American merchant is not a success in a foreign market? There are two reasons: firstly, he does not interest himself in the foreign market to a sufficient degree to understand it and make it a success; and secondly, he does. not apply himself to supplying a for

eign trade with the same intelligence which he exhibits in catering to a home trade.

How is the American merchant to transform his dream of conquest in foreign fields into a reality? Firstly, by taking a genuine interest in the foreign field and making a study of it, and secondly, by giving to the foreign market the same intelligent consideration which he applies to his home business.

In what way can the American exporter interest himself in China as a field for exploitation, and how is he to study the demands of this market most effectively? Naturally, the first essential is to ascertain whether or not China offers to him a market for the particular line of goods which he is handling. Many articles of foreign manufacture find a market in China now which a few years ago were un

known to the Chinese consumer. Hence, to study the customs returns of trade only would not accord one an index to the potential wants of the Chinese consumer. Twenty years ago, China knew practically nothing about condensed milk. To-day there is scarcely a city in the Empire where condensed milk cannot be obtained. Because there is no demand now for an article does not necessarily mean that such a demand cannot be created by an intelligent system of educating the Chinese public to recognizing the virtues of that article. There is probably no better illustration of an effective educational trade campaign by a foreign concern in China than that conducted by the British-American Tobacco Company.

Probably no more than twenty years ago, cigarettes were almost unknown in China. The British-American Tobacco Company studied

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situation, decided that China offered a good market for cigarettes and entered upon an intelligent, enterprising policy of creating a demand. They suited their products to the purchasing power of the people, and by a persistent campaign of education carried on through men who, in many instances, spoke the language of the people, extended the sales of their products to the very remote parts of the Empire. Last summer, while on a tour across the Shansi, Shensi and Szechwan Provinces in West China, the writer found scarcely a town of any size in that remote part of the Empire which was not placarded with the posters advertising the British-American Tobacco Company's products. This concern has two large cigarette factories, one at Hankow and another at Shanghai, supplying the demand it has created in China for its products. Of its success in China, the British

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American Tobacco Company can well say: "I came, I saw, I conquered."

Contrast with the intelligent interest displayed in the study of China as a possible field for its products by the British-American Tobacco Company, the unintelligent methods resorted to by a large American firm which some years ago cherished a dream of adding China to its field of conquest. This concern sent one of its young salesmen to China with instructions to study the field and report upon the possibilities of establishing an agency there. The young man spent much of his time about the Shanghai and Tientsin hotels and had more to say about sport than about the business for which he was sent to China. Although he had met but few. influential Chinese or foreign business men of any prominence, yet he informed the writer that he was reporting to to his company that there were no chances for them in a business way in China. The mistake this company made was in sending out a man not equal to the task. If the concern in question, a company capitalized at several millions, really thought it worth while to send a man to China to study the situation, they should. have sent one of their big men, a man who carries with him a passport to the best mercantile society, and who has the brains to size up a situation after a reasonable amount of observation and study. Establishing a branch. in a country with a population of 400,000,000 just entering upon the dawn of modern civilization, and among competitors of all nationalities is not a question to be entrusted to an inferior man. If it is not worth the attention and study of the biggest man in the establishment then it is certainly not worth the money spent in sending out an ordinary salesman. In this particular case the line of goods handled is one which already commands a large market in China, and one which, with China's industrial development, is going to offer immense opportunities. When this salesman heard that the London, Hamburg

and Osaka merchants were already in the field, he threw up his hands and exclaimed that there was no room for the American.

The American exporter looking to China for a market can secure much valuable assistance at the beginning of his investigations from the American Consuls stationed in this country. Extra-territorial jurisdiction has resulted in placing the foreign consuls in China in a position of greater relative importance and prominence than foreign consuls enjoy in any other country. In addition to this, the fact that the Chinese official is held in an exalted position by the masses in China, has resulted in placing the foreign consuls, who by treaty are accorded a rank equal to that of the highest Chinese official in the port, in positions of great respect in the mind of the Chinese business men, so that, ordinarily speaking, the foreign consul is persona grata in the treaty port to which he is accredited. Hence the position of a foreign consul in China is a strong one, and one capable of meaning much to the trade interests of the country he represents.

The Department of State, working in conjunction with the Department of Commerce and Labor, is doing all in its power to secure from its Consular Service a maximum of usefulness in promoting American trade interests. Each year every consulate must prepare and send to the Department of State for publication in the monthly Consular Reports, an annual trade report covering the trade conditions in its respective district, with special emphasis upon such commercial features as affect American trade. From time to time the Department calls for special reports, often in response to requests from the Department of Commerce and Labor or the Department of Agriculture, or from commercial associations or bodies.

Each consul makes a number of special commercial reports to the Department of State from time to time, upon subjects in his district of interest to American trade. Furthermore, the

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