If your company is considering expanding internationally, China holds plenty of amazing business opportunities.
You may find yourself traveling there to negotiate and discuss business strategy, so you’ll need to know what to expect and have a firm understanding of the cultural differences you might encounter. There are many.
If you are planning your first business trip to China, here are five helpful tips to make sure your journey is successful and enjoyable.
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1. Anticipate Flight Delays
China’s airports are the worst-rated in the world when it comes to punctuality, so don’t schedule any important meetings for several hours after your flight is supposed to land. According to a report from the Civil Aviation Administration of China, the worst offenders are Spring Airlines, Lucky Air, Shanghai Airlines, China Express Airlines and Chongqing Airlines. Spring Airlines has an average punctuality rating of only 56 percent, meaning almost half of their flights are delayed or canceled.
Being late to a meeting is considered extremely insulting in Chinese culture, so do whatever you have to do to make sure you make it to your appointments on time, no matter how long your flight is delayed.
2. Before Trust Comes Friendship
If you’d like to develop fruitful business relationships in China, be prepared to do a lot of personal bonding first. There’s even a word for it, Guanxi, and it can’t be rushed. You will likely want to attend business dinners to get to know the client or partner, where business is often not discussed at all. Make sure to research what you should expect from such dinners, and how to conduct yourself to adhere to Chinese cultural norms.
Always bring a gift when you meet with Chinese business associates, as it is a customary sign of respect. For brownie points, bring something special from your home country. Most Chinese don’t have the luxury of traveling abroad often. Alcohol and tobacco products are generally appreciated, but you can also give fruits, nuts, teas, and other food items or health supplements.
3. Business Ethics Are Flexible
In China, business relationships are based on mutual trust and respect. That being said, Chinese businesses undeniably have the reputation of valuing profit over all else. According to Michael Witt, Professor of Asian Business & Management at INSEAD, Chinese business professionals may push the boundaries of what Westerners see as ethical, using questionable negotiation tactics.
“For example,” Witt said in a Forbes article, “the representatives of a large Western firm were negotiating the distribution rights for one of their products. Their Chinese counterparts closed their initial pitch by threatening to use their political connections to prevent the distribution of their products if they did not receive the rights. In another case, the Chinese party got their Western guests drunk to prevent them from being effective in negotiations the following morning (which, on the Chinese side, involved a completely different set of people).”
This is no reason to be discouraged from doing business in China, but it is definitely something to keep in mind. If you’re going to drink, do so responsibly. You can always abstain, but you’ll likely get teased a bit. Women are not expected to participate in heavy drinking, so it might also be wise to incorporate a few women into your team when negotiating.
Consider gathering payment up-front or on the delivery of services or product, as business laws in China are not as regulated, and contracts generally aren’t as strong. You may have to fight for payment later. For guidance on this topic, check out this article from the China Law Blog.
4. Chinese Culture Can Be Complex
Above all else, always be respectful when doing business with the Chinese. Interrupting, no matter how urgent your comment, is considered very rude. Pointing at people, acting cocky, getting angry in public, or even accepting food or drink without first refusing a few times are generally considered rude as well.
Many things that are considered positive traits in Western business culture, like assertiveness and directness, for instance, can make people think you’re rude in China. It’s a good rule to listen more than you speak at first, and only voice your opinion when it’s asked for. Aside from politeness, patience is rewarded. You probably won’t accomplish much in your first meeting, and your main focus should be building trust and familiarity.
5. Data Security Is Important
The Chinese government censors the Internet heavily, controlling the type of information that can be accessed, as well as monitoring who is accessing what content, at what times. If you’re planning on traveling to China, it’s wise to use a disposable cell phone, and invest in a laptop that you use only for your travels there.
Limit the files you have on your travel laptop to the essential, and never send or receive sensitive documents online during your stay. If you must, only exchange this information over a secure network and websites. Also, make sure you encrypt your hard drive and use dual-password protection. If your device is stolen it will be extremely difficult to extract any usable information.
Many professionals also have trouble accessing websites like DropBox, Twitter, Facebook, and Gmail while doing business in China. To remedy this and mitigate security issues, it’s possible for your company to create a site-to-site Virtual Private Network, which allows you to access web pages and data securely as if you were on-site at your office. There are also public VPN’s which will allow you to access censored websites, but may lead to different data security issues. Either type of VPN will slow your connection considerably.
While doing business with a culture that is very different from the Western norm can be intimidating, that is certainly no reason to shy away from the many lucrative opportunities that exist in China. If you follow these five tips and are gracious enough to be respectful of the way the Chinese operate, you’ll likely gain loyal business partners that will help your business grow for years to come.