That Local Partner Promising "Great Connections"? Verify Everything Before You Sign.

The single most dangerous sentence in China business is:

"I have many connections in this industry. I can be your exclusive agent and sell millions."

Every foreign SME hears this. Most get excited. Many sign an exclusive agreement. Almost all regret it 12 months later.

The pattern is always the same: the partner talks a good game in the first meeting, promises access to their "extensive network," shows a few WeChat contacts, and asks for exclusive rights. You sign. Six months later, you've shipped product, you've given market support, and you've heard nothing but excuses. But you're locked in — the exclusivity clause means you can't talk to anyone else.

Before you give anyone exclusivity, verify these five things:

1. Actual team size and experience — how many people work full-time on sales? A solo operator can't cover a province, let alone a region. Ask for org charts, not LinkedIn profiles.
2. Track record — ask for sales figures for similar products over the last 3 years. Not projections. Not "pipeline." Closed revenue. If they won't show numbers, they don't have them.
3. Infrastructure — do they have their own warehouse, service network and after-sales team? Or are they just a trading desk with a phone?
4. Existing brands — how many other brands do they represent? Are any direct competitors? A distributor carrying 20 brands gives you 5% of their attention at best.
5. Inventory commitment — are they willing to carry safety stock of your product? Skin in the game separates real partners from commission-only middlemen.

Run these five checks before signing anything. If the partner resists verification, that is your answer.

Before you invest time chasing a lead, we run a counterparty audit: corporate filings, legal status, ownership structure, and 9 red-line risk scans — bankruptcy, credit blacklists, frozen equity, deregistration, tax arrears. This eliminates the obvious dead ends instantly. For the commercial layer — financials, track record, brand portfolio, infrastructure — the five questions above are what you'll ask directly. Two layers, one outcome: you walk into the negotiation knowing exactly who you're dealing with.