During the century that followed the Treaty of Nanking the organisation of the import trade changed even more than that of the export trade. The changes could be attributed mainly to three causes. First, as the Chinese gained experience of foreign trading methods and foreign goods, they were able to participate successfully in many commercial operations from which ignorance had hitherto excluded them. Consequently, the earlier ways of organising particular types of business ceased to be economical and gave place to others. Secondly, the types of imports themselves changed, as was shown in Chapter II. Finally, the sources of supply for many goods altered, and new men brought new methods. These adjustments could be observed as having taken place in particular classes of goods no less than in the import trade as a whole, and the trends in the organisation of the cotton trade well illustrate the general development.
It has been shown that after the Treaty of Nanking the import of cotton manufactures into China, chiefly from Great Britain, increased rapidly, and by the opening of the last quarter of the nineteenth century these goods took first place on the import list. At first, this business was entirely in the hands of the large merchant houses who bought and sold on their own account. These houses set up branches, not merely in the larger ports, but in the smaller ports also when these were opened to trade. Sometimes the goods were imported direct into these small centres, and sometimes they were trans-shipped from Shanghai or Hongkong; but in any event they remained the property of the foreign merchants until they were sold to the Chinese dealers at the last Treaty Port through which they passed. The technical skill and commercial knowledge needed for the piece-goods trade could, however, readily be acquired by the Chinese dealers. So, by the sixties, these, with their local experience and low distributive costs, were superseding the foreigners in all stages of the trade which did not require contacts abroad--that is to say, in all stages except the actual processes of import. The trans-shipment trade passed into Chinese hands; direct importing into the smaller ports ceased; and the branches that foreign firms had established there were gradually closed. Even the larger centres were affected. For instance, by 1872 about half the shirtings