Doing Business in China

When doing business in China, the ability to navigate cross-cultural issues is just as important as the goods and services you bring to the marketplace. This is true whether your company is just now considering the China market, recently gained its first sale or maintains an in-country presence.

Mia Doucet, author of the award-winning book China in Motion, prepared the following tips for CanadExport to help Canadian companies avoid costly mistakes.

Tip #1: Asians want to do business with people they trust. But there is no real trust unless a person is in their circle. At first, they don’t know if you will be a good partner. Show respect by keeping some distance. Focus on building the relationship before talking business. Do not go for big profit on your first contract.

Tip #2: To protect your intellectual property, use the same due diligence you would in the West.

Tip #3: Never pressure your Asian colleagues for a decision. To speed up the decision process, slow down. Start from the beginning and work through to a solution in a logical, step-by-step fashion. Then stand your ground.

Tip #4: The negotiation process will be anything but smooth.
Your best strategy is a walk away mentality. You have to go in trying not to make the deal. Explain your position in clear, concise words. State your terms clearly. Respectfully. Then be prepared to walk away if your terms are not met.

Tip #5: Respect face. Never argue or voice a difference of opinion with anyone—even a member of your own team. Never make the other person wrong. Never say "no" directly, as that is considered rude and arrogant.

Tip #6: Account for the fact that most Asians understand less spoken English than we think they do. The easiest thing in the world is for a Chinese to say yes. Their smiles and nods have more to do with saving face than getting your meaning. Talk in short sentences. Listen more than you speak. Pause between sentences. Find four or five easy ways to say the same thing. Never ask a question that can be answered with a simple yes. Avoid all slang. Skip humour altogether.

Tip #7: Manage the way you present written information. Document everything in writing and in precise detail. Present your ideas in stages. Write clearly, using plain English text. In order to appeal to Asian visual bias, use sketches, charts and diagrams.

Tip #8: Prepare for every interaction. Do not count on your ability to wing it. A lack of preparedness can cause loss of face and trust. Do not give or expect to receive partial answers from your Chinese colleagues, as that is considered offensive.

Tip #9: Make sure your facts are 100% accurate in every detail, or you will lose credibility. Do not present an idea or theory that has not been fully researched, proven, or studied beforehand. If you make a mistake, you are not to be trusted.

Tip #10: Everyone on your team needs to know how to avoid costly gaffes.
Most of us are not by nature sensitive to the differences in culture—we have to be taught. Time-honoured passive resistance could bring your company to its knees. It makes sense to teach people the cross-cultural factors that have a direct impact on your profits.

I agree with most of what is written in this article. To elaborate further on tip#1 - avoid acting too "chummy" or casual. Keeping a little distance is important. Knowing your place is vital as well as remaining respectful. As well avoid showing off, Tip#9 says you have to know all you facts but it doesn't mean you have to show off. Be confident that you know every detail but you don't have to flaunt it. When you are asked to then give the information but if you are not asked to don't.