A trader's way of life

This is especially true of the textile industry in which Lin Yuhua's company operates. His company, Shanghai Xie Da International Trade Co., Ltd. (hereinafter referred to as Xie Da Company), is located in Shanghai and specializes in the export of undershirts, knitted garments, knitted sweaters and baby clothes. China's accession to the WTO has changed many rules. With the change of textile quota situation every year, the quota of the largest US market will be cancelled soon, and more competitors have obtained import and export rights. Under such circumstances, Lin Yuhua understood that in order to survive, Xie Da had to adapt and change.

Like many non-manufacturing export companies in China, Xie Da has a successful export history and stable customer base. The company is part of the original China Artex Shanghai Import and Export Corporation, which was established in Shanghai in 1999, with 70% of the shares held by employees and the remaining 30% owned by the state. 100% of the company's products are exported, mainly to large retailers and importers, including well-known foreign brands such as Liz Claiborne and GAP, which have attracted the attention of Chinese apparel counterparts. The company's annual export volume exceeds 60 million US dollars and has been successfully exported to more than 50 countries and regions, such as North America, Europe and Japan.

Nevertheless, Lin Yuhua's current concern is not the past, nor the present, but the future. He starts by making sure that big clients like Liz Claiborne will continue to work with the company and continue to bring profits to the company.

Suppliers are also customers

It is difficult for Chinese trading companies to remain competitive. It is often heard in the media that as buyers prefer to source directly from factories or manufacturers, trading companies are under pressure to be "robbed" of business, forcing these companies to pull out all the stops to meet these challenges. Some trading companies choose to build and invest in some production facilities, others switch to trade-related service industries, and some form partnerships with foreign companies or build bridges in the middle.

Since its independent operation in 1999, Xie Da has been unable to avoid these problems. "We know we have to adapt to the changing environment in the textile industry, and we have also studied the contingency measures other trading companies are considering," said Lin Yuhua.

Instead of changing the business to a wholesale structure, Xie Da management felt it would be better to continue operating as a trading company, but to continuously provide more tangible value to buyers and suppliers. "We have two customers: buyers and our suppliers, and we have to treat them fairly and give them the same service," said Lin Yuhua. With this goal in mind, the company began to make changes to close the relationship with both types of customers.

Building Design Capabilities

In the midst of change, the decision to establish a research and design center may be one of the most effective moves. "Two years ago, we didn't have a dedicated department to study and design new clothing according to the fashion trends in overseas markets," Lin Yuhua said, "but now our design room is the first choice for customers to visit."

This is Lin Yuhua The kind of value that is talked about when discussing how a trading company can survive in the marketplace. A company's investment in time, training, and tireless effort is far greater than the visible cost. It is not easy for domestic designers to understand or even predict the most popular clothing styles, materials, designs and colors in current overseas markets. "Our American clients can keep sending their designers to Europe and around the world, and we can't do it at will, but we have to know their needs in order to design for them," Lin Yuhua stressed.