Chinese Business Practices and Etiquette

Here’s something I wrote last year. With Aalibaba’s IPO, all the talks we here about the chinese economy and doing business in China. I wanted to post an article giving insight on chinese business practices and etiquette. If you are planning to do business in china for the first time in the near future, understanding Chinese business practices and business etiquette will impact your level of success in doing business in China. Chinese business practice and etiquette revolves around Confucianism the concept of duty, harmony, loyalty and respect. Duty, harmony, loyalty and respect translated through the face.

The Face

Facial translations are broken down into 4 categories. The first two categories reflects deeds and actions. The loss of face reveals information of public knowledge, otherwise it is a compliment or to give respect. The third category is facial development, the face is developed through age and experience. A wise person who avoids mistakes, face is increased. The fourth category is when the face is increased through the compliments of others.

Chinese Relationships

Relationships in China are always formal and should stay formal by avoiding humor and jokes, informal behavior may be lost in translation. Before doing business in China, you should have a Chinese contact to act as a reference for networking, interpretation and to help you better understand the bureaucracy and the legal system in China.

Meet, Greet and Negotiations

Meetings in China start with light hand shaking, nodding, exchanging business cards and with small talk. A hard or firm hand shake is upon as aggressive behavior. When exchanging business cards you should mention your company’s name, your rank, along with any other relevant qualifications. One side of your business card should contain the Chinese translation on your card written in gold, as gold is a favorable and lucky color. When receiving a business card, you should gently take the card with both hands, read it and place it in a case and not your wallet. Physical contact must be avoided. Situations where contact is permitted, such as hosting or guiding, physical contact is only made by holding the cuff or sleeve of a shirt. The Chinese also read body language. Your body language should stay calm and attentive as this displays respect, confidence and self-control.

When sending a meeting invitation to the Chinese, you should include background information and history of your company. Meetings must not be scheduled during any Chinese national holiday. It is best to schedule meetings between the months of April and June, and September and October, arriving early as a late arrival is insulting. Meeting agendas should begin with the core issues first. Keep in mind that the Chinese are tough negotiators so you must be willing to show that you’ve been compromised to give the Chinese negotiator the impression that they have the upper hand.

Gifting

Gifts should only be exchanged during a time of celebration or as a gesture of thanks. Before the Chinese buy a gift for you, they will ask you what type of gift you would like to have. It is best to ask for what you want, however, a wise choice would be to ask for an ink painting or tea to show your appreciation.

References

Millet, J and Savvy, C. (2010). Chinese Etiquette & Protocol. Retrieved from http://www.protocolprofessionals.com/articles_china_print.htm on September 27, 2013/

Kwintessential. Doing Business in China. Retrieved from http://www.kwintessential.co.uk/etiquette/doing-business-china.html on September 28, 2013.


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