The fact that China has the most billionaires in the world is proof if any was needed that doing business in China is a smart move. The process, however, is much more complicated for foreigners going it alone, so having Chinese partners is not only advantageous, but sometimes vital to survival in China's business sphere. We'll bring you some tips on how to strike and maintain good relationships with your Chinese partners when doing business in China.
Whenever you meet a potential Chinese partner for the first time, it's standard etiquette to hand over business cards at the very beginning. This is also a great cheat sheet to ensure you refer to your partner by their correct title, which is very important in China.
Whether Mr Li ( lǐ Xiān Sheng 李先生) is a young/junior employee (Xiǎo Lǐ 小李) or in a manager/senior position( Lǐ Zǒng 李总), make sure you give him the title that's due. Calling people by their proper title goes a long way to showing respect in China.
Bribery and kickbacks are unfortunately still a part of doing business in China, with the Middle Kingdom ranked among the most corrupt countries in the world, despite government efforts to cull the "tigers". When doing business with Chinese partners, you might find it difficult to differentiate between what is considered a gesture of good-will and what feels like someone buying you off.
You'll find gift giving is common, but it goes without saying that large, expensive gifts may raise a few eyebrows, especially if they're presented at the very beginning of a new friendship. Gifts in China are typically opened in private, however, so if you feel a partner has overstepped the boundary you can give the gift back without causing a scene. You should also stick to standard gifts such as fruit and alcohol to avoid being accused of bribery yourself.
Building pre-business rapport is essential for forming relationships in China. You'll need to become accustomed to talking about potentially boring and pointless topics over long lunches and tea drinking sessions with your Chinese partners, as they'll prefer not to delve into business chit-chat straight away. Safe small talk topics include the climate, food, scenery, travel and any positive impressions you may have of China and its people.
For Chinese business folk, the negotiation process is not just limited to discussing costs and deadlines, but rather getting to know one another on a personal level and establishing the ever-so-vital "guanxi" that much of Chinese business is based on.
In many Western countries, treating potential partners to a coffee is pretty much standard practice. In China, however, you should go a step further and treat them to a full-on business banquet once a deal looks set. Make sure you insist on paying the entire bill, even if it means fighting for it.
Whether you're buying an underground ticket, ordering food or paying your bills, everything seems to be done fast and efficiently in China. But don't hold your breath waiting for your Chinese partners to get back to you swiftly with a response or a decision
The decision making process is slow in Chinese business situations, so you'll want to allow them plenty of time to mull over their options. It's best to avoid pushing for a response, at least until some reasonable time has passed.
It might not seem like it with the yelling and swearing you hear on a daily basis, but China prides itself on being a harmonious society. People generally avoid openly challenging others, which all boils down to the complex concept of "face". Be aware that any criticism, no matter how minor or irrelevant you think it is, is potentially a massive slap in the face for your Chinese business partner.
If it's a minor criticism it's best to just keep it to yourself. If you encounter any continuous or serious issues with your partners then bring them up privately Don't do it in front of an audience and avoid third-party involvement.
Conflict resolution is markedly different in China too. Conflict and arguments, if they do occur, don't usually result in a termination of the relationship as they might in the West. Maybe the Chinese are just more forgiving?
Last but not least, you'll want to avoid falling into the 'direct foreigner' stereotype by responding to requests or suggestions with a blunt "no". The Chinese way is to reply with a "maybe" or "we'll think about it", even if you have no intention of taking the idea on board.
Make sure you send good wishes to your business partners, either in person or through social media, during major Chinese festivals, particularly Spring Festival, Mid-Autumn Festival and National Day. It doesn't matter whether you're calling them, sending a text or forwarding a festival GIF on from WeChat, the fact that you actually bothered will mean a lot. Also, small seasonal gifts, such as moon cakes during the Mid-Autumn Festival, are greatly appreciated.
You'll want to learn to spot the confused look that might come across the faces of your Chinese partners from time to time when you speak English. Chinese people are often too embarrassed to ask people to repeat themselves, so keep an eye out for signs that they've misunderstood or have stopped listening completely. If in doubt, follow the meeting up with a short wrap up memo so everyone has everything in writing.
Is there anything we've missed? Let us know in the comments below!
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