German-Chinese relationship sparkles on through good and bad times

Whatever the occasion, there are always fireworks when Christina Henkel is around. It is very much a family affair, and one with China, which started more than 50 years ago when her grandfather began a business dealing with the descendants of the inventors of the great tradition.

So it was no surprise when she arrranged a spectacular 10-minute pyrotechnic display of the highest quality to mark the 50th birthday of her Chinese partner Qu Ping at their villa at Bocham in the Ruhr region of Germany.

"This is a life-long memory because Christina presented her love to me in such a traditional Chinese way," says Qu, an artist-turned-businessman, who has settled in Germany.

The rocket art on display that night was bought by Henkel, 34, from the global fireworks capital of Liuyang in Central China's Hunan province.

Since 2003, when she joined the family business, she has gradually taken responsibility for buying and quality control of about 400 containers every year.

Family-run enterprises have been the backbone of the German economy, but in recent years fewer of the younger generation have been willing to take up their inheritance in the business.

Henkel is an exception, and has even been singled out for her entrepreneurial zeal by local authorities during the economic slowdown.

Qu, not surprisingly, says he has long been impressed by her intelligence and diligence.

"For a lady at such a young age, it is rare."

However, Henkel is still serving her time in the business, still learning, and happy to be on a slow fuse.

"At present, my father still wants to continue to work, and I will support him and learn from him as much as possible, but if one day he wants to retire, I hope that I will be ready to take over our business."

That business, FKW Keller GmbH, was founded by Franz Keller, Henkel's grandfather on her mother's side, and his brother Theo Keller. Based in Bochum, it is one of the leading fireworks suppliers in Germany, with about 16 percent of the consumer market.

FKW Keller imports all its fireworks from Liuyang, where about 1,000 factories produce nearly 65 percent of global production, and also supply the other big German names in the industry, Weco, Comet and Nico.

Henkel first visited Liuyang in 1994 when she was still at school, spending two weeks with her father, Hans-Joachim Henkel, CEO of Keller.

She did not visit China again until 2003, when she started her career in fireworks. Then, she accompanied Keller's general manager, Horst Krokowski, as an observer, but soon she was asked to lead a staff team to visit Chinese partners.

But rather than a firecracker of a start, it was more of a damp squib.

"There was no cultural shock for me as I was regularly in touch with our Chinese partners since my childhood during their annual visits to our company. But I made a lot of mistakes at first because I wasn't aware of the Chinese business etiquette," Henkel recalls.

She found Chinese culture different. In Germany, people are, comparatively speaking, straightforward and direct. Henkel says: "We criticize for the sake of improvement, and it is better to communicate very directly. But in Chinese culture, we shouldn't do it this way."

Henkel is very grateful to her father, who taught her to be independent in leadership. He was mainly responsible for buying and quality control before she took over the job.

"This was a process of observing, to see how he treats people, how he gets along with them, how to make compromises and how to express things better."

In 2007 her father passed over that side of the job to her.

"Since then, I could make my own decisions and I am very grateful to my father for the teaching and trust," Henkel says.

In Germany, fireworks can only be sold to the public on the last three workdays of the year. But the schedule is busy year-round for Henkel's company.

Keller accepts orders from German clients from January to March, and in April or May it places orders to the factories in China. Before the end of September, the factories ship to Germany for distribution to clients.

Henkel is now busy, at the height of the production period. Having returned from China in July, she is planning her September visit.

"Safety is always the priority for us, and we need to solve all the problems at the beginning," Henkel says. Keller employs 15 staff in Liuyang to oversee production and safety.

Forging direct partnerships with local fireworks producers, such as Liuyang Gongyi and Liuyang Liuhua factories, was Henkel's strategy after she took over purchasing.

"Our strength is that we always keep closer ties and friendships with Chinese producers," she says.

Henkel says her company went directly to producers on the mainland long before her competitors, who only went to Hong Kong to engage agents.

"Our relationships are long-term orientated as we believe that it is important to have stable pillars because of the high risks associated with our products," Henkel says.

This is the foundation that her grandfather Franz Keller laid when he first traveled to Guangdong and Liuyang in the 1960s to meet provincial export cooperation departments. Also in the 1990s, when Liuyang started to allow private ownership of export companies, her father maintained close ties with privately owned fireworks exporters.

When Keller started in the 1960s, it was the only German company importing fireworks from China to compete with fireworks made in Germany.

But over the years, the quality of Chinese fireworks improved along with the country's economic status and became more attractive to the German market. More recently, Keller's rivals have also started to forge direct contacts with exporters in Liuyang.

Now, with more than 180 countries placing orders in Liuyang, exporters have more choice, and importers such as Keller are facing higher costs.

Customers are more demanding when it comes to quality and packaging, which means higher prices.

Keller has decided to abandon old business models and establish more direct business ties with fireworks factories. This has improved efficiency and cut out intermediaries.

"As an old family business, we need to be pioneering and creative all the time," Henkel says.

Keller now has a logistics center in Germany and subsidiaries in the Netherlands and Poland. Thankfully, though the pall of the financial crisis hangs over in Europe, Germany's fireworks market has not been greatly affected.

Henkel is hopeful that it will continue that way, believing in her grandfather's adage that people will party when times are good, but also when times are bad to forget their problems.

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