Portal to connect China, U.S. merchants

The People's Republic of China is going portal.

E-commerce specialist U.S. Business Network (USBN) and six ministries of the Chinese government will later this month open MeetChina.Com, a business-to-business commerce portal dedicated to bridging the cultural, financial, and bureaucratic gaps that currently exist between Chinese manufacturers and their U.S. customers.

By July, approximately 15,000 Chinese electronics manufacturers will be offering goods through the venture, according to Ken Leonard, CEO of USBN.

Under the arrangement, which USBN says is exclusive, the six agencies will help co-market the site and also share in the revenue with USBN. The official rollout of the site will occur on April 28 in the People's Great Hall in Beijing.

One of the agencies driving the development of the site is the Ministry of Information Industry, which was recently formed through the merger of the Ministry of Postal and Telecom and The Ministry of Electronics.

"For political and historical reasons, the [export] market has been very inefficient for them," Leonard said.

"The government is trying to open this up rapidly. The Ministry of Information is a big sponsor of putting business-to-business transactions online," he said.

The news follows last week's visit to Washington by Chinese premier Zhu Rongji, who pressed China's case for admittance to the World Trade Organization.

MeetChina.Com will function as both a standard electronic commerce portal and as a consultant. The main purpose of the site will lay in connecting suppliers of raw materials, components, and finished products in China to buyers in the West.

But, because cultural and commercial gulf that exist between China and many of its trading partners, USBN will perform a number of diplomatic functions to ensure that Western buyers are comfortable with whom they are dealing and vice versa.

USBN, for instance, will qualify the Chinese sellers by examining their letters of credit, manufacturing certifications, and past business histories prior to letting them sell products on the site. Total Creative, a design house based in San Francisco, will also create Web sites for these manufacturers.

Buyers, by contrast, will be in closer contact with Chinese suppliers than in the past. Until now, goods from the mainland have typically past through distributors in Hong Kong and elsewhere. MeetChina.com will give them a direct link. The company will additionally find qualified shipping companies to deliver the goods.

And there is always nuisance management. "If they [customers in the United States] want to speak to someone in China, they can come directly to us. They can fax or phone someone at the company in the U.S. and we will get the information they need," he said. Bilingual speakers are stationed in both USBN's domestic and Chinese offices.

Initially, revenue will largely come from the qualifying process and site hosting, said Leonard. USBN will charge $1,500 a year to maintain a full Web site for a qualifying Chinese company. Eventually, the company will move to a transaction-based business model.

"We expect MeetChina.com to play a significant role in boosting our growing export economy by allowing Chinese manufacturers to deal with foreign buyers directly," said Wu Bao Gui, director of the Ministry of Information Industry in a prepared statement.