Luthier Ou Minzhong of Guangzhou sized up a bass ukulele held by John-Heizer Enos of Hawaii's Pacific Music Foundation at a meeting yesterday in the southern Chinese city. Enos wants to find a low-cost manufacturer in the area for the instrument.

Chinese businesses
hungry to partner

Hawaii's delegation finds suppliers
very eager to strike deals

BEIJING » Showing perfect form, Paul and Katherine Aumer-Ryan rise eagerly for their Chinese counterpart, each extending a business card with two outstretched arms and a respectful stooping of the shoulders.

They came to China without a clue of what they'd find.

But after several days sizing up possible business partners, Hawaii firms participating in a trade and cultural mission through China are getting the hang of it.

"It's been a learning experience if nothing else," said Paul, of Honolulu-based special-effects house Cause and f(x) Pictures.

Yet it's been more than that.

Midway through the nearly two-week mission, small Hawaii companies look set to leave China with promising commitments from potential partners that could boost their businesses.

MANY OF THE 40-odd Hawaii companies participating in the mission came here in fact-finding mode, not expecting to strike any deals.

Hawaii economic officials and China's trade council had worked to arrange one-on-one sessions for Hawaii businesses and possible Chinese partners to feel each other out.

But while Hawaii participants quickly showed a grasp of the form and ritual, their Chinese suitors didn't always reciprocate.

"I got mobbed. I was kind of shocked," said Stacey Hayashi, who runs Web-based aloha attire retailer Painagirl.com and came seeking a supplier of low-priced clothing.

Decorum broke down during meetings in Shanghai with potential Chinese suppliers, who tripped over each other to get her business, Hayashi said.

She eventually reached a verbal agreement with a supplier and plans to send a down payment on an initial order.

Though such small deals hardly justify the state's rambling mission by themselves, they're giving smaller firms an exhilarating opportunity to think a little bigger, turning local horizons into potentially profitable international ones.

"I'm stoked. It's looking good," said George Hurd, who operates Kahaluu aquarium gear merchant Aloha Aquatics.

HURD WAS UNNERVED by ominous warnings given to delegates early in the trip about the risks of doing business in China.

But in Shanghai he found what he wanted -- a supplier of quality fish tanks at one-tenth the price of his U.S. sources.

But his Chinese counterpart went even further, offering to make Hurd its exclusive U.S. distributor. Experiences like his illustrate one of the truths of the opportunities now present in China -- that sourcing cheap goods from China is a less risky introduction to China business with more immediate rewards than trying to sell to Chinese consumers.

The latter is fraught with difficulty due to a still-underdeveloped consumer market.

If they do find a demand for their product, Hawaii companies are typically hamstrung by their small size, often unable to meet China's massive volume requirements.

However, China can be highly profitable with the right product, and Hawaii companies might enjoy an advantage over those from other states, said Dean Ho, a consultant to foreign businesses.

Ho said Chinese, who place a high value on reputation, will typically view Hawaii's paradisiacal image as auspicious in business.

"That's your biggest advantage. You can't play up that angle enough," he said.

Ou Jenuyun, a Chinese TV executive who met with Cause and f(x) Pictures, said the fact that the delegation is American meant more than state origin, but Hawaii was the hook.

"Everybody loves Hawaii, right? So that made us a little more curious," he said.

The two cultures didn't always mesh perfectly.

Hawaii firms had to deflect aggressive suitors wanting to ink deals the same day.

Hurd's counterpart repeatedly offered him cigarettes -- including the one from his own mouth -- despite Hurd's repeated refusals.

"It was a bizarre experience, but it turned out well," he said.

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