When you enter into a business contract and want to conclude a transaction with a partner, you are expecting some profits.  However, you have keep in mind that some risks will always accompany the transaction, especially if you are dealing with a new Chinese partner.

How to reduce the risk and secure the transaction?

Apart from creating a perfect contract for you to sign, it is better to verify the Chinese partner. Some of the so called companies may never registered at the AIC ( a government agency for company registration in China); some of them may not have the capacity to perform the obligations under the contract.
So, if you have a new business partner, it would be safe to retain a Chinese lawyer (or at least a Chinese friend) to check the background of the new partner.