Doing Business in China
China Business Guide Service
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Improved international relations, preferential policies, an expanding economy and increased foreign investment make doing business in China a potentially lucrative affair. Tannet will give a brief introduction as follow, in order to provide the information for the foreigners doing business in China.
Doing business in China means that business people will come into increasingly frequent contact with Chinese business people and officials. As the saying goes, "Do in Rome as Rome does", when you go to China to do business, you should learn something about the business etiquette and culture in China. It is imperative that those doing business in China learn about areas such business culture, business etiquette, meeting protocol and negotiation techniques in order to maximize the potential of their business trip.
In this short guide to doing business in China, a few cultural facts and their influence on business culture and etiquette are explored. These are in no way meant to represent a comprehensive summary of tips on doing business in China but a highlighting of some important key areas one may encounter.
Meeting & Greeting
Doing business always involves meeting and greeting people. In China, meetings start with the shaking of hands and a slight nod of the head. Be sure not to be overly vigorous when shaking hands as the Chinese will interpret this as aggressive.
The Chinese are not keen on physical contact - especially when doing business. The only circumstance in which it may take place is when a host is guiding a guest. Even then contact will only be made by holding a cuff or sleeve. Be sure not to slap, pat or put your arm around someone's shoulders.
Body language and movement are both areas you should be conscious of when doing business in China. You should always be calm, collected and controlled. Body posture should always be formal and attentive as this shows you have self-control and are worthy of respect.
Business cards are exchanged on an initial meeting. Make sure one side of the card has been translated and try and print the Chinese letters using gold ink as this is an auspicious colour. Mention your company, rank and any qualifications you hold. When receiving a card place it in a case rather than in a wallet or pocket.
Relationships in China are very formal. Remember, when doing business you are representing your company so always keep dealings at a professional level. Never become too informal and avoid humor. This is not because the Chinese are humorless but rather jokes may be lost in translation and hence be redundant.
When doing business in China establishing a contact to act as an intermediary is important. This brings with it multiple benefits. They can act as a reference, be your interpreter and navigate you through the bureaucracy, legal system and local business networks.
The biggest specific difference between Western and Chinese business culture is in decision making. Quick decisions are alien to the Chinese. Rapid decision making, incorporating quickly gathered and processed information is a sign of an aggressive, highly competent manager in the West. But to the Chinese, haste is the sign of an idiot.
The Chinese prefer to deliberate longer, even on decisions that might take Western managers five minutes, says George Koo, who has facilitated joint ventures between Chinese and Western companies since 1978 and is currently a senior consultant at Meridian Resources Associates Inc. in San Francisco. Discuss the issue, ask for feedback and explain your decision's rationale, he advises. This way, the staff will be more accepting and respectful of the decision.
The Chinese want to be included in the decision-making process at a degree of collaboration that to a Western manager may seem unnecessary for relatively simple points but is nevertheless important in this culture. "A snap decision to them is an insult," adds Richard Loi, a Singaporean who is managing director of the UPS Parcel Delivery Co. in Beijing, United Parcel Service of America Inc.'s China joint venture. "They want to feel honored that you bring issues to them and ask what they would do. Even if you think it's a simple decision, mull it over and talk to them about it." The results-buy-in, compliance, good feeling--will be worth the extra effort.
Meetings and Negotiations
Meetings must be made in advance. Preferably some literature regarding your company should be forwarded to introduce the company. Try and book meetings between April - June and September - October. Avoid all national holidays especially Chinese New Year.
Punctuality is vital when doing business in China. Ensure you are early as late arrivals are seen as an insult. Meetings should begin with some brief small talk. If this is your first meeting then talk of your experiences in China so far. Keep it positive and avoid anything political.
Prior to any meeting always send an agenda. This will allow you to have some control of the flow of the meeting. The Chinese approach meetings differently, so rather than beginning with minor or side issues and working your way up to the core issue, reverse this.
The Chinese are renowned for being tough negotiators. Their primary aim in negotiations is 'concessions'. Always bear this in mind when formulating your own strategy. You must be willing to show compromise and ensure their negotiators feel they have gained major concessions.
Make sure you have done your homework before doing business in China. The Chinese plan meticulously and will know your business and possibly you inside out.
One known strategy for Chinese negotiators is to begin negotiations showing humility and deference. This is designed to present them as vulnerable and weak. You, the stronger, will be expected to help them through concessions.
Above all, be patient and never show anger or frustration. Practise your best 'poker face' before negotiating with the Chinese. Once they see you are uncomfortable they will exploit the weakness. Decisions will take a long time either because there is a lack of urgency, simultaneous negotiations are taking place with competitors or because the decision makers are not confident enough.
If you have further queries about the China business set up, don’t hesitate to contact Tannet anytime, anywhere by simply visiting Tannet’s website www.tannet-group.net or www.shenzhen-company.net , or calling Hong Kong hotline at 852-27826888 or China hotline at 86-755-82143422, or emailing to firstname.lastname@example.org.
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