A simple cultural difference threatened to scuttle a perfectly good
working relationship. To avoid similar cultural disasters, here are some
tips on how you can conduct a more successful business in China.
The initial approach
Chinese business are mostly referrals; essentially a business
relationship is struck based on another business associate
recommendation. The best prices and deals often comes from a strong
recommendation.
However, it is common today for cold calls and direct contacts, given
the availability of the internet and the competitive nature of Chinese
businesses. You may source from the internet, trade fairs, catalogues
and brochures, advertisements and approach the Chinese companies
directly through a call or email.
Alternatively, if you are seeking to invest in a factory in China,
you can approach a investment committee or a business advisory directly.
They will be able to advise you on your best location based on your
industry, raw material and manpower needs. Please contact us directly if
you have such a need and we’ll be glad to advise accordingly.
Relationship
Chinese business relationship inevitably becomes a social
relationship after a while. Unlike Western business relationship which
remains professional and perhaps, aloof, even after a long time, Chinese
business relationship becomes a social one.
The more you share your personal life, including family, hobbies,
political views, aspirations, the closer you are in your business
relationship. Sometimes, a lot of time is spent discussing matters
outside of business, but then a lot of time, the other party is also
making up his mind about your deal based on how much he sees your
personal relationship with him.
Seniority
Seniority is very important to the Chinese especially if you are
dealing with a State owned or government body. Instead of addressing the
other party as Mr or Mrs so and so, it is always appropriate to address
the other party by his designation ie Chairman So and So, Director So
and So or Manager So and So.
When giving out namecards or brochures, make sure you start with the
most senior person before moving down the line. When giving out a
namecard or recieving one, ensure that you are stretching out with both
hands with the card. Remember to face the card you are giving out in a
manner such that the recieving party gets it facing him correctly.
Giving Face
Giving face (aka giving due respect) is a very important concept in
China. You must give the appropriate respect according to rank and
seniority. For example, if you are buying gifts for an initial contact,
make sure you buy better gifts for the senior managers instead of buying
similar gifts across the board.
Similarly, sitting positions in a meeting room or a dining table is
accorded accordingly to rank, importance and seniority. It is good to
seek advice before embarking on your first meeting with Chinese business
contacts to avoid making the wrong move.
Gifts and Presents
Unlike earlier days when China was very poor, gifts, especially of
Western origin was especially appreciated. Today, China produces and
imports almost anything imaginable and gifts are no longer a novelty.
However, gifts are always appreciated and especially in the smaller
cities or towns, will continue to play an important part in your
business relationship. Do note that if you are indeed giving gifts, make
sure the senior people get a better gift or at least gifts perceived to
have a higher value than their junior staff.
Similarly, expect to recieve gifts from the Chinese, especially
Chinese art products. It is polite not to refuse, especially if it is
not of too high a monetary value.
Lunch/Dinner
There is no business talk in China without at least one trip to a
restaurant. Sometimes, a trip is made to the restaurant even before any
business discussion take place! Inevitably, the restaurant will always
be a grand one and you are likely to be hosted in a private room.
There is an elaborate seating arrangement for a Chinese business
meal. There are fixed seating positions for the host and the guest and
then they are seated again according to seniority. This is a very
important aspect of a formal dinner and it is important that you follow
the rules accordingly. However, it seems that the Northern Chinese are
very particular to this formal seating arrangement while the Southern
Chinese has loosen the formalities somewhat.
You may like to find out more this interesting China Book.
Drinking with the Chinese
The Chinese are big drinkers especially in Northern and Western
China. It does not matter if it is lunch or dinner; as long as a meal is
being hosted, there will be alcohol.
Chinese wine is the favorite, followed by red wine and beer. Chinese
wine is more like fuel than liquor, having a alcohol concentration as
high as 60%! No matter how good a drinker you may think of yourself,
never, ever challenge a Chinese into a drinking contest. They will win,
hands down!
It is often seen as rude not to drink with the Chinese in a formal
dinner. To maintain your sanity, either claim to be a non alcoholic or
plead medical grounds as an excuse. This will let you off the hook with
little or minimal drinks. Better yet, bring a partner who can drink on
your behalf!
After Dinner Entertainment
Formal business dinner normally drags for quite sometime as there
will be much social talk, some karoake, and drinking contests. Most of
the time, everyone is too drunk to indulge in further entertainment
after a dinner. In addition, if you are just new to this partnership,
you are unlikely to be invited to further after dinner entertainment.
However, once you are familiar with them, you may be invited to a
Karaoke, or a Night Club, or a Suana. Do note that if they are the host
for the night, all bills will be picked up by them for the night,
including all entertainment. It is impolite to fight for the bill or
worst, split the bills.
Similarly, if you are the host for the night, you are expected to pick up all bills for the night.
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