Trade & Finance Corporation
History.
Origins
TransContinental’s history dates back to the 1970’s. Originally formed as a limited liability Hong Kong trading company in 1978, TransContinental was later incorporated in the USA.
1970s
TransContinental opened its first office in Beijing in 1978. Working conditions were challenging: Companies operated out of hotel rooms because there were no office buildings in Beijing at the time. Foreign businessmen were allowed to live in hotels mostly on renewable 2 week visa which were difficult to secure. Travel between China and the USA was usually on Pan-Am with a stopover in Tokyo or via Hong Kong. Within China, foreigners were required to secure travel permits for internal China travel (except from Beijing to Tianjin) and travel was mostly by train. Telex machines were the main tool for business communications. One had to go to the Telecommunication Bureau to send telexes and find friendly Chinese companies to receive telexes on their behalf. TransCon was one of the first companies in Beijing to have its very own telex machine inside its offices. Telephone communication was slow, difficult and very expensive. Computers did not exist and photocopying machines were not allowed.
When China was primarily a small commodities exporter, TransContinental pioneered the sourcing of consumer goods in China. At the time, China had a trade deficit with the USA of about $600 million.
Our customers were US companies who were willing to experiment sourcing in China products that they would otherwise buy from South Korea or Taiwan. At the time, all purchasing was done through the central offices in Beijing of China’s main foreign trade companies (also know as “FTCs”) which had long names such as China National Textiles Import and Export Corporation or China National Light Industrial Products Import and Export Corporation. These names were abbreviated by Westerners to names such as Chinatex, Chinalight, Animal By-Products, Machimpex, Minmetals and Sinochem. Access to factories (for inspection or quality control) was either prohibited or severely restricted.
To balance the sourcing business, TransCon started selling to the China market, initially mostly small equipment and chemical sales.
1980s
With China’s rapid change, annual exports to the USA grew to $8 billion by 1989.
TransCon opened offices in Shanghai and Hong Kong in addition to the main Beijing office. Working conditions were improving. Foreigners could live in Chinese apartments and longer visas were granted.
TransCon, like the rest of the business world, replaced their telex machine with fax machines in the early eighties. Telephone connections became easier as well.
During this time, TransCon was given the right to perform inspections directly in factories. Its customer base expanded from solely US companies to include European and Australian companies. The FTCs progressively decentralized their power and allowed, at first provincial FTCs and later some municipal FTCs to handle exports. This decentralization also started to blur product specialties and broaden the offering of FTCs to include products that were supposedly the specialty of other FTCs. Towards the end of this period, some large factories were given the right to export directly.
TransCon specialized in selling machinery and plants of many different kinds. The (official) buyers were mostly FTCs such as Machimpex and Equimpex. Turnkey plants were preferred in those days, partially because performance was guaranteed by one Western supplier. Towards the end of the decade, TransCon started to focus on selling to China’s Building Materials sector.
In this decade, TransCon supported its equipment sales with initial investments in Chinese light industrial factories.
1990s
China was now recognized by most large western companies as the emerging market one needed to be part of. Annual exports to the USA grew to $66 billion in 1999.
Communications and travel options drastically improved during this time. Emails replaced fax machines and mobile phones emerged. Internal air travel significantly reduced travel times. This allowed TransCon to consolidate all of its China offices into the Beijing head office.
“Made in China” was by now recognized as inexpensive and reliable enough that everybody was rushing into the country to place orders. Margins dropped dramatically. TransCon no longer took title to the merchandise and shifted its approach to offering sourcing services and consulting. China Performance Group was formed to manage the growing sourcing business.
TransContinental continued to sell millions of dollars of equipment to the food industry and China’s light industry, and increasingly focused on the Building Material industry segment.
2000s - Today
China’s trade with the world grew exponentially. Annual exports to the USA grew to $320 billion in 2008. Then during the world financial crisis, China used its tried and proven central planning methods to inject funds into its infrastructure to maintain the growth of its economy. China’s success increased its international stature and caused Chinese businesses to explore global expansion opportunities more aggressively.
China Performance Group, a now stand-alone and independently managed division, continues to expand and offer leading-edge sourcing services.
De Clercq & Company was formed to take over the increasing volume of advisory services for sales, and market entry.
TransContinental now acts as a holding company for its two main divisions: China Performance Group and De Clercq & Company