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September 2, 2017

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Knowing about Chinese business culture pays off

CHINA’S culture and business practices differ from an expat’s home country. As you start or expand your business in China, understanding local business etiquette is important to success.

Awareness of these values help expatriate business people do more and better business here, which translates into more trade, more investment, more profitable companies and helps break down barriers.

Qualities appreciated by the Chinese include saving and giving face (mianzi), respect for elders and rankings, patience, politeness and modesty.

High-context culture is a phrase that was created by anthropologist Edward T. Hall in the 1970s to describe a culture’s style of communication. High-context cultures are those in which the rules of communication are primarily transmitted through the use of contextual elements (i.e. body language, a person’s status and tone of voice) and are not explicitly stated.

This is in direct contrast to low-context cultures, in which information is communicated primarily through language and rules are explicitly spelled out — “I say what l mean, and l mean what l say” — and expressed directly.

In a high-context culture like China, much less is expressed verbally.

Expat business people need to turn their radar way up to get a sense of the entire contextual elements of what is being said, or not been expressed indirectly.

Adapt, adapt, adapt

Communicate with awareness of the Confucian elements that form the mindset of the traditional Chinese person. However, in a contemporary context, one may be dealing with people who have studied and worked abroad, returned to China and may be very Western in their thinking. This may mitigate against the need to constantly be thinking about Chinese ways and culture.

Moreover, one should also be aware that those very same “Westernized” people, when acting in a Chinese environment, will cogitate and behave as any Chinese would. As such, be ready to adjust. The important thing to be aware of in business transactions is if there is benefit for both sides, then everyone will meet in the middle in respect of terms, conditions and cultural aspects in their collective efforts for mutual success, making it easier to mitigate their differences.

Collectivist element

When working with a group in China, there will be a lot more team-building activities that may be unfamiliar to expat business people. Be ready to adjust to local conditions on the ground. If you can do so quickly, you’ll be the better for it.

Business here relies heavily on personal relationships. Doing market research is important, but personal relationships are equally essential to success. It is crucial to establish and maintain good relationships with key contacts and relevant government officials.

Good ways to start the relationship-building process include:

• Attending industry networking events.

• Contacting industry associations and municipal or provincial investment promotion bodies.

• Following up on personal introductions.

However, it is important to remain aware of potential scams that you may encounter. A common scam unfolds as following:

You are approached by an unknown Chinese company with a large purchase order of substantial value. They insist on a contract very quickly and then insist that you come to China to sign the contract and pay the notarization fee (typically, a certain percentage of the contract value).

It is not mandatory business practice to notarize a contract in China, nor to sign the contract in front of a notary and share the notarization fee.

Attending meetings

If you’re invited to a banquet, there’ll be more food than you can eat, so pace yourself. Usually, the fried rice, followed by the fruit is toward the end of the meal, so you’ll see how things are progressing. Your host will try to keep your plate full, so if you really don’t want to eat any more, leave some food on your plate. If you are subject to rather strange dishes, it helps to just go with the flow.

If you are going to a meeting, don’t be late, and know who’s the boss.

Meetings in China may follow the same format as those in your home country, although with a bit more ritual. The Chinese value punctuality, so arrive on time or even slightly earlier. Check the Chinese calendar and avoid all national holidays, especially Chinese New Year.

Have a detailed proposition of the value of your company and product. Have Chinese-language materials for your hosts. Chinese businesses often meet with many foreign businesses seeking ties. So, capture their attention at the first meeting to secure a follow-up.

Foreign business people who have done their homework before arriving will be the better for it.




 

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