We often think of free trade as being the terrain of large multinational corporations. But small- and medium-sized companies often have just as much to gain. And their vitality can be a reflection of the health of China's national economy. Reporter Hu Nan visited one firm in Zhejiang Province to see how it has survived and prospered for more than two decades. 

When we take a sip from our drink, how many of us wonder where the straw came from? Yet every year, more than 30 billion of them are sold, that's enough to circle the globe 150 times. And for such a relatively simple commodity, you'd be surprised how much business it brings."

We've taken a trip to the world’s largest drinking straw manufacturer, Soton, in Yiwu city in East China's Zhejiang Province.

Does this deep green straw look familiar? Maybe for the coffee lovers out there. Soton produces straws for all Starbucks stores in China, and dominates more than half the European and Japanese high-end market. But its success is in part the result of giving up on large orders 10 years ago.

“At first our products were simple and basic like these. Although we were the largest producer, the low added value and fierce competition meant small profits. So we started to change our business model in 2005 to develop innovative products. This type of straw is now our bestseller. Its retail price is about 14 yuan or 2 U.S. dollars -- that's nearly 1,000 times more than what an ordinary straw costs. We have more than 40 kinds of creative straw products like this, which make up 80 percent of our profits,” said Lou Zhongping, chairman of Soton Import & Export Co., Ltd.

In 2005, Lou Zhongping made a decision, saying no one client should take three percent of the company's volume of business.

Aiming to protect his factory from being squeezed and exploited by big clients, he turned to smaller ones around the world. That’s when the traditional offline business gave way to the e-commerce platform we know today.

“We have close to 12-thousand clients now. It’s impossible to maintain so many through traditional, face-to-face business channels. In retrospect, for our decade-long e-commerce platform's application history, I can say there’s no clear-cut division between online and offline business now. It’s an integrated business ecosystem,” Lou said.

That’s also true for other small commodity manufacturers in Yiwu, a city famous for China’s largest small-commodity market.

Only five years ago, this Yiwu international trade mart drew a crowd of about 40,000 business people from all over the world. Now those men in the booths might be lucky to see one customer a day. But the lower number of visitors does not translate to fewer sales.

Last year, nearly a quarter of a million e-commerce entities in Yiwu city reported sales worth 150 billion yuan, or 22 billion U.S. dollars -- a 35% increase from a year earlier.

But for Lou Zhongping, profit is no longer his only focus. In his next five-year plan, environmental protection, employee training and meeting international industry standards will be his targets.