Abolishment of the comprador system:

Abstract

The purpose of this article is to determine how and why Mitsui & Co. abolished the comprador system at its Shanghai branch. We investigated the case of Mitsui & Co. because it is the oldest and biggest general trading company (GTC), and it has increased its Chinese branches in the years straddling the 1900s. We focus on Mitsui & Co.'s Shanghai branch because it was the first Chinese branch for Mitsui & Co., and it served as the headquarters for its Chinese branches. Mitsui & Co.'s Shanghai branch abolished the comprador system in 1899. This was a precedent for the other Chinese branches of Mitsui & Co. and other companies, for example, other Japanese and German trading companies.We illustrate three reasons for the abolishment of the comprador system at Mitsui & Co.'s Shanghai branch. The first reason was Mitsui & Co.'s comprador himself. The comprador had a distinctive character. He drew salary as an employee, earned commission as an agent, and had a group of staffs. A typical comprador has the character of an employee and an agent and a group of staffs.The second reason was the influence of the off-the-job training (off-JT) program. The overseas off-JT program was launched in April 1898 and January 1899. Preceding studies advocate that the off-JT program undermined Mitsui & Co.'s comprador system. However, Mitsui & Co. abolished the comprador system in July 1899 at its Shanghai branch; thus, the trainees employed thereafter were on training and not on the job.The third reason was the human resource practices of Mitsui & Co. Employees that they cultivated during their professional practice in Mitsui & Co. and went on to become managers to deal with some goods in 1899.Mitsui & Co. cut down costs on the salary and commissions provided to the comprador, increased its trading partners, and adopted a long-term marketing strategy because of the abolishment of the comprador system.