Understanding China Business Culture
Many entrepreneurs who enter the China market fail to succeed due to misunderstandings with their Chinese counterpart. Hence, if you want to do business in China or with a Chinese, it is worth understanding China business culture.
Good relationship first
The Chinese take their time and do not enter into negotiations right away. This is unlike the Western style of business where everything happens in a fast pace. The Chinese would rather have a good relationship with you first before they get into any business agreement. In China, this is commonly referred to as guanxi, or building a good relationship. This is considered very important. Also, building a strong guanxi with lots of people usually leads to more business opportunities.
A yes does not always mean yes
The Chinese are respectful. In fact, they are too respectful that they say yes even when they really mean no. It is not that they are difficult people to deal with. It is simply a part of their culture. Thus, be more attentive. Your Chinese business partner might say, “Yes, but…” Or, instead of saying yes, they can use the word maybe. Do not expect them to disagree with you with a clear no. Do not worry if this is confusing for you; you can always ask politely for clarifications to make things clearer.Face culture
The Chinese value reputation and prestige. They have a concept of face, which they call as mian zi. Gaining face is good, but losing face is terrible. This is one of the main reasons why the Chinese are very respectful. They do not want to offend anyone, or cause anyone to lose face by their words or actions. And, of course, they expect to be treated with the same respect and professionalism.
Most men have the habit of giving a strong handshake, as if competing on which one has a stronger grip. Some tend to squeeze the other person’s hand and act as if they do not intend to do so, as if they are naturally strong. But, this style does not work well in China. In China, it is not about who has the stronger grip that matters, but who can last longer.
Another important thing in understanding China business culture is the importance of small talks. The Chinese enjoy having small talks, especially at the beginning of a meeting. Small talks are helpful, because they set the mood and help everyone feel comfortable before moving on to serious matters.
Although the Chinese enjoy engaging in small talks at the beginning of a meeting, they also expect you to be prepared. If you are going to use materials for presentation, make sure that your materials are ready and complete. Always be prepared when you meet with them.
Expect for delays
The Chinese usually extend negotiations beyond the deadline. Also, do not expect to close a business deal in one meeting. If you want to successfully close a deal with a Chinese, expect to have several meetings.
Do not give gifts
Chinese etiquette forbids the giving of gifts or presents to a business partner, except when there is a special occasion. It is considered bribery, which is also against the law of China. And, if you ever give a gift, make sure you do not give these insulting gifts to your Chinese business partner.
Meals and alcoholic drinks
It is common for a Chinese host to serve lots of food on the table. This is a usual part of China business culture. Here is where it gets tricky: If you leave too much food on your plate, it might give a message that you do not like the food, but if you finish all the food on your plate, it might be taken as if not enough food has been served. Hence, to play it safe, show how much you love the food while eating, then save a bit of food on your plate. This will give a message that you really like the food but simply could not take another bite because you are so full. It is also usual for alcoholic drinks to be served. If you do not drink, make sure to inform your Chinese host before the meeting. However, if it is already too late to give such notice, you can also inform your Chinese host during the meeting, but be sure to give a reasonable excuse. Medical reasons are acceptable.
Do not talk about business during a meal
Another thing about China business culture that many Westerners do not realize is that the Chinese would rather go back to small talks during a meal and avoid business topics. For the Chinese, meals are for fun and leisure. It is the time to talk about yourself, your family and hobbies, among others. It is the opportunity to get to know each other on a more personal level. Thus, avoid business topics during a meal, except if your Chinese counterpart is the one who initiates a conversation related to business.
Be the first one to leave after the meeting
It is part of China business culture to wait for your partner or client and see him leave. This does not mean that your Chinese business partner does not like you and is sending you away. It is simply part of China business culture to wait for the other person to leave first.
Express your appreciation
This is not really a part of China business culture, but it applies in all cultures. It always counts when you show your appreciation. A simple thank you would be mean a lot, especially if you say it sincerely.
Understanding China business culture is important if you want to have a successful and long-term business relationship with a Chinese. These things are easy to observe. You just have to make a few adjustments, and you will soon find yourself happily working with your Chinese business partner.
Free Book: Doing Business in China - Tips and Tracks
China has its own business culture and etiquette.
There are many things that a businessman from West needs to understand if he wants to enter the China market and succeed.