Go Global: The Story of Hengyuan Xiang

Author: Wu Jimin / Country: Mainland China
Publisher:
Publish Date: 2006-03-01
Features: In late 1925, Shen Laizhou joined the British-run Deji Trading Company as a broker. As a broker, he was not employed by Hunter but instead sourced goods from him and found buyers, earning commissions based on sales. Deji Trading Company dealt in a variety of imported goods, so Shen Laizhou's connections from his previous work at the Jiukang Trading Company came in handy. He worked diligently and gradually saved a small fortune. Unlike Weng Ziyin, Hunter treated him very kindly. Shen Laizhou's English skills, learned from Hunter, were put to good use, and the two had no language barriers, allowing for easy communication. Hunter highly valued his Chinese friend and often proactively sent him popular goods. A strong friendship grew between them. Later, when Shen Laizhou became the big boss of Hengyuanxiang, he still acted as an agent for Deji Trading Company until Hunter passed away in Shanghai in 1940.
The Xian Guan Lane in the old city area of Shanghai was the heart of old Shanghai, just a stone's throw away from the famous old residence of Xu Guangqi. In early 1926, a young man rented a small flat here, hung a sign, and printed a business card. It read "Shen Laizhou." This young man was Shen Laizhou, and "Shen Laizhou" was the name of his family-owned business. In reality, it was just a "wall-side small shop," with no storefront, no counter, no warehouse, and no sales staff—except for a wall, nothing else. This was a very vivid metaphor, like a gecko clinging to a wall, lying in wait and ready to act. In fact, this is what we call a "suitcase company" today—all information, goods, and accounts were carried in Shen Laizhou's constant companion, a suitcase. But since he had established a business, he needed an address for registration! So Shen Laizhou rented a small room in Xian Guan Lane. Every morning, Shen Laizhou would carry his suitcase to the Lixin Pavilion Tea House in the City God Temple or an old Shanghai tea house to drink tea. This cup of tea would last for several hours. Almost all of Shen Laizhou's business friends would come to drink tea at this time. Besides exchanging information, all deals were made in the tea house. If you wanted to buy goods, how much they cost, and where to ship them—all were settled in the tea house, followed by paying deposits, shipping goods, and paying the full amount after receiving them. Shen Laizhou visited the Lixin Pavilion Tea House every day, regardless of the season or weather, never taking a break. The connections he had built over the years came into play, and with Hunter's help, he made a lot of money.
Shen Laizhou was a bold man. Through some local trading companies in Heilongjiang, he managed to do business with the Soviet Union! At the time, the Soviet Union was under an imperialist blockade, with severe shortages of goods, especially warm blankets and kerosene lamps for lighting. With Hunter's help, Shen Laizhou imported a large quantity of blankets from Britain and resold them in the Soviet Union, making a fortune.
1927 was a very important year in modern Chinese history—a year of great ups and downs, joys and sorrows, and endless reflections. It was also a year filled with coincidences and stories around the world. In China, Jiang Jieshi, relying on his army and his ally, the Communist Party, launched the April 12th Coup, crushing the Great Revolution in blood and tears. He formed an alliance with the Jiangsu-Zhejiang financial clique—one with guns and power, the other with money and capital—beginning a 22-year rule over China. At least for 10 years, from 1927 to 1936, he maintained stability in the wealthier regions of Jiangsu and Zhejiang, where the economy flourished, and the national GDP doubled. This is the "Golden Ten Years" that modern historians have always been fond of discussing.
Take Shanghai as an example. The "Greater Shanghai Construction Plan" was prepared and gradually implemented starting from this year, only to be cut short by the outbreak of the Shanghai War in 1937. In terms of global business development, many major conglomerates and brands were born in 1927. Among them are the U.S.-based CBS (Columbia Broadcasting System), Marriott International (a top luxury hotel group), Japan's JVC Group, Sweden's Volvo, and Switzerland's Rolex. Some may have started humbly, perhaps as "wall-side small shops" or some kind of business name, but today they shine brightly. It is particularly worth mentioning that the International Wool Board was also established in the Czech Republic in Europe that year. The pure wool mark it issues is the most authoritative mark for wool products, which played a huge role in the future development of Hengyuanxiang. We will provide a detailed introduction to this in the second volume of this book. P42-43