Doing Business in China
Are you currently doing business in China, or are you planning to in the near future? Consider this…
- The Chinese have the oldest known calendar that dates back to 2600 BC. One year is based on the phases of the moon, and a complete cycle of the Chinese calendar takes 60 years.
- Ice cream was invented in China around 2000 BC when the Chinese packed a soft milk and rice mixture in the snow.
- Long ago, silk making was a closely guarded secret in China. Anyone who tried to give the secret away or was caught smuggling silkworm eggs or cocoons was put to death.
- Each minority in China speaks its own dialect or language, and there are over 200 different ones recognized today. The most common are Mandarin, Cantonese, Shaghainese, and Kejia dialects.
- During the world financial crisis, 40% of all Chinese small businesses either crashed or went bankrupt.
- Despite its immense size, all of China is in one time zone.
- Exports from China to the United States total to about $200 billion. Both countries depend on one another for continued prosperity and success.
Did you know that China is the fourth-largest country in the world and is home to over 1.3 billion people? If you would like to take advantage of this enormous business opportunity, then pay close attention to these tips—they can ether make or break your ventures.
- Personal relationships, known as guanxi, are very important in the Chinese culture. Relationships signify the commitment to help one another, not just to do business. Focus on building guanxi before jumping into corporate details.
- Business cards are exchanged on an initial meeting. Make sure one side of the card has been translated (in Mandarin) and try to print the Chinese letters using gold ink, as this is an auspicious color. Mention your company, rank, and any qualifications you hold. When receiving a card, never place it in your wallet and then in your back pocket.
- Meetings typically start with a nod or bow. Shaking hands is also common, but wait for your Chinese associate to extend a hand first. (An overly vigorous handshake can be interpreted as aggressive.)
- Avoid making dramatic gestures or using exaggerated facial expressions. The Chinese do not use their hands when talking and become distracted by a speaker who does.
- Gift giving is appropriate on certain occasions. Avoid giving anything of value in front of others; it could cause embarrassment and trouble. Acceptable and appreciated gifts include high-quality pens, gourmet foods, liquors, and stamps if your associate is a collector (stamp collecting is popular in China).
- Red is considered a lucky color in the Chinese culture. In contrast, white is the national color associated with funerals and mourning.
- Try and book meetings between April-June or September-October. Avoid national holidays—especially the Chinese New Year.
- Punctuality is vital when doing business in China; late arrivals are seen as an insult.
- Meetings should begin with some brief small talk. Keep it positive and avoid anything political. (If it is your first meeting in China, talk of your experiences in the country so far.)
- Always send an agenda prior to any meeting. Start with core issues and end with minor or side concerns.
- Expect to make presentations to many different groups at different levels.
- When entering a business meeting, the highest-ranking member of your group should lead the way.
- It is not uncommon for the Chinese to supply an interpreter. If possible, bring your own interpreter as well to help you understand the nuances of the discussion.
- Be patient and never show anger or frustration. Patience is the most important skill needed to do business in China. The Chinese are very good at figuring out when a foreigner is under pressure and will turn that into their advantage.
- Never pressure your Asian colleagues for a decision. To speed up the decision process, slow down, start from the beginning, and work through a solution in a logical fashion. Then stand your ground.
- Never argue or say “no” directly, as it is considered rude and arrogant.
- The Chinese are known for being tough negotiators. They aim for concessions in negotiations, so you must be willing to show compromise.
- Decisions will take a long time either because there is a lack of urgency or confidence, or because there are other negotiations taking place with competitors.
- The Chinese expect the business conversation to be held by senior officials. Subordinates may speak when asked to provide data or comments, but in general, they do not interrupt.
- You will probably be treated to at least one evening banquet. If so, you should always return the favor but never surpass your host in the degree of lavishness.
- Never begin to eat or drink before your host does.
- Expect your host to keep filling your bowl with food whenever you empty it. Clearing your bowl may be an insult to your host, because it can mean he did not provide you with enough food. However, leaving a bowl completely full is also considered rude.
- Your attempts at using chopsticks will be appreciated. When finished, place them back on the chopstick rest. Placing them parallel on top of your bowl is considered a sign of bad luck. (Dropping your chopsticks is also bad luck.)
- Serving dishes are not passed around. It is acceptable to reach over others to get the serving dishes. You should reach for food with your chopsticks—but not with the end you put in your mouth.
- Generally, conversation during a meal is centered on the meal itself and is full of compliments to the preparer. Other suitable topics include Chinese sights, art, calligraphy, and the health of the other’s family.
Morrison, Terri, and Wayne A. Conaway (2006). Kiss, Bow, or Shake Hands, 2nd edition. Massachusetts: Adams Media Corporation.