10 tips for doing business in China

Published on December 16th, 2020

Introduction to Chinese business culture

The single most important factor in making a good impression with the Chinese is to build relationships and cultivate them carefully, otherwise known as Guanxi. Building the friendship has to come before business is done; trust has to be in place before a deal can be made. Achieve this by entertaining and accepting hospitality; joining in with events like banquets and drinking sessions; and certainly by understanding what makes the Chinese mind tick – the concept of saving face, of honour, loyalty, respect for seniors and the trading of favours to get a job done.

Being smartly dressed, serious, punctual and deferential to elders will also win the respect of the Chinese. Furthermore, be careful in conversation not to make a Chinese person lose face by discussing topics such as Taiwan, Tibet, human rights issues or the growing capitalist culture in Chinese cities.

Top 10 tips on Chinese business culture:

1. Think flexibly

The Chinese do not use linear logic but may be influenced by philosophy, superstition and a desire to merge a number of solutions rather than choose one over the other.

2. Use guanxi

A network of personal contacts can make or break a deal in China. Guanxi consists of several individual dimensions, such as ganqing (emotional attachment), renqing (reciprocal favour exchange), and xinren (interpersonal trust).

3. Embrace mianzi

The concept of saving face is fundamental to all relationships and to every social transaction you will make.

4. Recognise a negative answer

Chinese do not like to say ‘no’ as it causes loss of face. ‘Yanjiu Yanjiu’ means ‘We will do some research and discuss it later,’ or most likely, that the other party is not interested.

5. Be adaptable

Negotiations may carry on long after an agreement has been signed so prepare to make further concessions.

6. Avoid the hard sell

A subtle selling technique works better – but will not prevent your Chinese counterpart from bargaining hard.

7. Work in a group

Meetings and negotiations are usually carried out in large groups, with discussion taking place in a formal, structured manner, according to rank.

8. Respect the hierarchy

Decisions come from the top and information is not shared with all ranks within a company.

9. Develop stamina

Entertainment on a lavish scale should be taken seriously, from attending and hosting banquets to drinking sessions.

10. Dress the part

You will be judged on your appearance, which should be professional, groomed and conservative, but stylish.

WRITTEN BY TERENCE BRAKE

Terence Brake is an author in the global learning & development field and has over 20 years of experience helping executives to work better across cultures.


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