China Business

Business Information from across China
Helping your Business with China

China Business » Business Tips » Issues Concerning Negotiating in China

Issues Concerning Negotiating in China

Western and Chinese business models differ somewhat due to cultural issues. In China the issues which seem most important before even beginning a business relationship involve saving face, personal relationships and establishing common ground. These may not seem so important to many western businessmen, but they tend to be decisive to the Chinese businessmen. A brief discussion of each of these issues can be of benefit to a western entrepreneur who wants to do business with a Chinese partner.

Saving face is important to most people, regardless of their ethnic background. We all want to look our best to others. To the Chinese, however, it also involves helping others to look their best as well as not being embarrassed themselves. This involves how one carries himself as well as how he treats others. Any attempt to make oneself appear important or superior to others is frowned upon by the Chinese. Likewise, any attempt to belittle another person is highly unacceptable to Chinese businessmen. A person's reputation and social standing is off-limits in China. Even if a person is not esteemed highly, he is not publicly embarrassed by others.

A related issue to this is formality. The Chinese do not often accept dealing on a first-name basis in business relationships. The Confucian idea of deference to superiors brings a deeper formality than many western people appreciate.

The Chinese concept of guanxi involves personal connections. The Chinese prefer to feel a strong trust in those with whom they go into a business relationship. They often have dinners and get-togethers to help them get acquainted with new foreigners who hope to form partnerships with them. These are times of learning to trust each other. A foreign businessman should attend those get-togethers, bring simple wrapped gifts and their business calling cards, but they should not expect any business talk to happen until later.

The Chinese have their own vision of a successful businessman. In their minds, he values harmony in his relationships. They use the introductory dinners to learn if the foreigner will be harmonious in any partnerships he forms with his Chinese counterparts.

This leads us to common ground, areas in which the Chinese and the foreigner agree. Although each person in a partnership is an individual, there need to be common areas of agreement on which to build the partnership. Looking for common positives in the other person rather than the negatives is a good first step in establishing a positive business relationship in China.

Regardless of how well-prepared one is to meet the Chinese, there will be evident areas of misunderstanding. Westerners often consider the Chinese to be inefficient, indirect and even dishonest. On the other hand, the Chinese tend to see the westerner as too direct, aggressive, impersonal and too easily excited over trivials. The best approach is to realize that some of these stereotypes may disappear after a lengthy business relationship. Each side of the partnership can eventually begin to see where the other side is coming from and learn to appreciate it.

Business Tips