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Pitfalls to avoid in doing business with the Chinese
Yanique Lawrence
News
BY YANIQUE LAWRENCE Observer writer yanique_alexia@yahoo.co.uk  
March 21, 2011

Pitfalls to avoid in doing business with the Chinese

WHEN doing business in any country it is always important to understand the basic business etiquette and important cultural differences of that country.

One could assume that as international trade increases, the world becomes more of a global village and cultures converge, that business etiquette is now essentially one size fits all. But one would be very wrong.

In the case of China, business requires a completely different size. China has a very long cultural history of but a very short history trading with the West and as a result there is very little common law or anything like a set of natural rules of etiquette or ethics. Things are changing as time progresses but there are some important things to note now.

There is the all important ‘guanxi,’ which is embedded in Chinese culture and dates back thousands of years. ‘Guanxi’ literally means ‘relationship’ but translates better to ‘connections’ or ‘networking.’ It is a very vital concept in Chinese business interactions and therefore important to understand when conducting business in China. It can help business transactions to be done more quickly and successfully. Establishing ‘guanxi’ involves far more than just the exchange of money or goods and is rather about developing a sort of friendship that involves the reciprocation of favours.

The Chinese prefer doing business with those they believe they can trust, so if you are not a reputable, or well-known brand, you may need an intermediary to provide an introduction and vouch for your trustworthiness. Once that ‘connection’ has been established it must be nurtured. This evolves into ‘guanxi’ and can work almost as well as a written contract. There is not always an immediate reward in helping someone but there will be some form of repayment in the future.

One must be very careful, however, not to cross the line into corruption and bribery. This essentially means nurturing the relationship without being unethical.

It is not wise to rely totally on guanxi, though, as it is merely a window. Whether there is any real benefit to guanxi is irrelevant, what is relevant is that the Chinese believe in it and as such to satisfy them it is best to take part.

So, you have made the connection and will have your first meeting. While you may want to cut to the chase and get right down to business, the Chinese like to indulge pleasantries and small talk first before doing so. It is important to forge a friendship before doing any business.

You will surely notice that the Chinese will not maintain prolonged eye contact. In the West, maintaining eye contact is a sign of trustworthiness but for the Chinese eye contact is avoided as it is impolite and can be interpreted as a challenge or, worse yet, arrogance.

Maintaining face is a quintessential element. In the Chinese culture it is very important not to lose face. If an error is made on their part, handle matters delicately and privately or your business relationship may suffer a serious setback. You should never try to force your ideas on the Chinese or bulldoze your way into a partnership. A better approach is to politely and confidently highlight all the advantages of them doing business with you.

Of course, there is also the language barrier to overcome but once you get past that with an interpreter or by learning the language, you will realise that communication can be made more difficult because of how things are understood. The thought process is different and as a result what is said and what is heard may be two different things. It is therefore, vital to be very specific when making requests and be sure there is no room for ambiguity or misinterpretation.

Let me illustrate with a real-life, even if it’s non-business example. Several times I have been to a restaurant to eat and I have clearly told the waiter ‘no pork meat,’ then a dish arrives with pieces of ham or sausage in it. I will ask the waiter why there is pork in my food, to which he will reply that there is no pork flesh just mere by-products. Lesson, always be specific in what you want or don’t want and assume anything. Ask questions for clarification and be sure both parties are on the same page.

Be sensitive to traditions and beliefs. The Chinese associate colours and numbers with different meanings and so one would not want to unintentionally offend them in this regard. Red (good fortune and happiness) and gold (wealth) are good colours. Green (harmony) though a good colour, when worn on the head, as in a hat is associated with infidelity. Dark blue is a sad colour associated with funerals. The numbers six, eight and nine are good numbers while four (equivalent to unlucky 13 in Western cultures) is a bad number. Its Chinese translation sounds almost the same as the Chinese word for death.

Most importantly, do your research about the company with which you hope to be transacting and express cultural sensitivity. The fact that you made the effort to take into account their culture will be sure to leave a good impression.

Yanique Lawrence is a Jamaican who did her Masters and now teaches English in China.

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