In China you will find yourself at an imaginary “negotiation table” more often than in western culture. And it’s not just true of purchasing a larger item like a house, car, or employment offer; which westerners may find more typical to negotiate. A negotiation is also likely to take place over smaller purchases like clothing, vegetables or fish market. Negotiation is expected everywhere in China. So understanding negotiation expectations is critical for success. Business schools teach negotiation courses globally, but often the most important aspect of negotiation is left for business men and women to learn on the job. The most important aspect of successful negotiation is knowing your opponent. Understanding their expectations and cultural influences. Negotiating with a Chinese businessperson requires a westerner to adapt his/her strategies and skills differently.

Negotiation in the Asian Culture The Asian culture in general, (and the Chinese in particular), is an introvert culture. We are less direct, require more time to react, show a low level of trust towards outsiders, and focus primarily on establishing relationships. In my experience, westerns focus more on the deal, respond quickly when interested, and begin with a level of trust as long as items of contention are written within a contract. In each of these areas, a westerner can step out of turn if they are not careful. For example, anything expressed too directly or at an inappropriate time is considered rude. Here is how I recommend adapting your tactics when negotiating with Chinese business partners:

Setting targets: Set and adapt your targets specifically to the Chinese business culture, for instance, building relationship might come before signing contract in your target.

Respect your opponent: Respect their way of thinking and being. Give them the time they need to respond.

Emotional compensation: If you are the party in power, take the emotion of your opponent into consideration instead of focusing only on achieving your goal.

Change and adapt stepwise: A stepwise approach can be more effective – confirm mutual understanding and agreement after each step and then move forward.

Master the tactics of your opponent:  “One who knows his own strength and that of the enemy is invincible in battle.” – “The Art of War” by Sun Tzu.

Practice in an actual combat: The techniques sound familiar, don’t they? For example, one globally understood – negotiation strategy called “turn the tables”. Purchasers often use this tactic after a seller asks him/her the absolute maximum they would be willing to pay.  The purchaser would “turn the table” by asking the seller for the absolutely minimum they’d be willing to accept. This tactic is used often in China. It often is like a game of “Ping Pong” which goes back and forth a couple of times. In each round each side would only lower the offer a small amount. Both parties know that this dance will continue and that stating their offer as and “absolute maximum” or “absolute minimum” are absolutely meaningless. Both sides also make up nonsenses in order not to increase/decrease the price. For example one may repeatedly state a new low price is the lowest they can go, or vice versa. The back and forth until a deal is set can be a lengthy process, and a real test of patience and persistence.  To rush it or not understand it would easily kill the deal.

Would you like to learn more how to apply negotiation tactics in a Chinese context? Contact us to book a free personal consultation, and learn how.

Beijing is rapidly becoming one of the most expensive cities in the world much like New York and Tokyo. Wealth and poverty are evident everywhere. Many skyscrapers stand closely together side by side with traditional architecture like “Hu Tong”. Beijing is a place where modernisation coexists with history in harmony. I am still in love with Beijing. My experience visiting was met with a sense of home and inspiration.

For my husband, there were three main aspects that struck him during his first visit to Beijing.

Traffic is crazy
The moment you step foot outside, the flurry of movement hits you. Buses, taxies, motorbikes, scooters, and bicycles come from every direction toward you. You get the sense that survival requires complete focus. While this environment caused constant stress and fear for my husband, it did not bother me.

Shopping malls are everywhere
Beijing is heaven for shopping. The malls are leisure centres. They are usually tall buildings equipped with five or six floors dedicated to premium brand stores. Moreover, they often offer a food court that takes up a complete floor of cafes. Another floor complete with game centres and a cinema. Quite a number of them also offer a high-end play grounds for small children, several beauty salons and education centres. Several of them are directly connected to metro stops for convenience. One can truly spend whole day in a mall for pleasure, and young people even date in the mall. I must admit that I miss this concept a lot in the Netherlands.

Curiosity towards westerners
Chinese people have a genuine interest in anyone who is western. Anyone even looking western is interesting. It is common for English-speaking Chinese people to want to chat with westerners. They will be interested in where the person comes from, and they often request to take a photo with western strangers in the street. And in some rare cases, they may take a photo of you without your permission or knowledge. It can feel as if you are a touristic attraction. While this can feel invasive and forward to a westerner, this behaviour stems from a genuine interest and admiration towards a different look and culture. They do not mean to offend or annoy anyone. A polite request to stop is often all that is needed.  Overall Chinese people are very open and friendly, and you can always ask them kindly for space/privacy whenever you are uncomfortable.

Both the expat and their Chinese clients, colleagues, friends, and neighbours benefit when they can reach a better understanding of one another.  Understanding these and other cultural differences can really help an expat living in China have a better integration experience. Having friends and/or family members explain the culture as experiences unfold drastically changes your perception of the reality you are experiencing. When expats experience culture shock without someone they trust walking them through it, they can feel isolated, confused, angry, and frustrated.

While everyone is not as lucky to have a Chinese wife guiding them through their expat experience, I recommend new expats find a group of local friends or expats to help through their transition. Formal programs like language and cultural education can really help expats prepare for what to expect – even before they arrive in China.

Relationship First. Business Later.

Lin Luo | August 1, 2018

One of the biggest challenges in conducting/starting a business in China is establishing solid relationships as an “outsider”. As a young woman I remember sitting at a desk doing my homework in my father’s office at a large Chinese business. Clients would often tell his colleagues “we will only proceed with further discussion if you send Mr. Luo over”. In different stages of business negotiation, closing deals and solving conflict, he was often the one customers requested. It was clear to me that he had a way of managing interpersonal relationships that led to his overall success. Whether you are a native Chinese business person or a new foreign expat, understanding and developing relationships is paramount to success in China. Here are some tips to breaking through and getting your foot in the door of Chinese businesses.

1. Find someone you know first. If you know anyone working in the company, (anyone… even someone in an unrelated role) contact them first. You are much more likely to get a meeting if you are introduced by an employee or friend of an employee in the company.
2. Reach out to industry relationships. If you do not know anyone at the company, try to contact the people you know in the industry who would offer an introduction or reference.
3. Hire an Intermediary. Chances are you already have relationships in China if you are expanding your business there. However, if you do not have a contact at a prospective client’s company, I would recommend hiring an intermediary to introduce your company for you. Tactics like cold-calling or email marketing from an unknown sender is rarely read, much less responded to.

Once you establish contact, it is paramount that you understand what is most important to your Chinese client. The relationship. While this may seem like a basic sales understanding,  you should understand that in Eastern culture the relationship is not just important, it is the focus.  The goal is not the contract or the deal. The relationship is the goal. Deals will only be awarded to those who have a relationship. Even a subpar proposal may win a deal if it was proposed by someone with whom a trusted relationship is developed.

The goal is not the contract or the deal. The relationship is the goal.

 

 

Maintaining your  relationship is also important. Care, follow-up and maintenance is required. My father did not only manage his own contacts and network well, but he also created many opportunities for his acquaintances, who eventually succeeded in their own business. Part of maintaining relationships is to help clients, friends and your network. The Chinese look out for their friends and for the greater good. It’s always on their mind. And they prefer relationships with people who understand and live by these same values.

To learn more tactics on how to gain and maintain Chinese business relationships, or advice on hiring a trusted intermediary, contact us for a free consultation.