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Five cultural tips for doing business in China

A few weeks ago, I helped an Indian guy, who’d only visited China for three times, conduct interviews with his Chinese suppliers.

He was new to the job and clearly didn’t know much about China or Chinese culture. Such questions like: “Does Taiwan belong to China? What about Hong Kong?” “Why do Hong Kong and mainland China share different politics?” “How does your government control the people?”— among other ones that came out of nowhere — left me shocked and confused that he came so unprepared.

Even though the economic strength of China might be rising, its isolated culture means it might still take decades, or centuries, for standards and systems to match this speed considering the country’s population and size. Doing business with Chinese for the very first time can be overwhelming — be it the constant drinking, day or night, while you are simply trying to seal the deal; regular nodding and agreement, with the “yeses” leaving you wonder if they have actually understood you; and how are you going to protect your intellectual property, since Chinese do have a reputation for copying.

Knowing the culture, and how to talk and deal with Chinese could save a lot of time and trouble, to help seal the deal faster and easier.

Chinese people love to say ‘yes’

Every country has its own culture. If you ask a British colleague, “Do you want to join a business event tonight?” and they are reluctant to say no, they will say: “I might stop by” as a way of being polite. Meanwhile, Americans are often more straightforward and probably would say: “I’m busy tonight, so I’ll pass.”

However in China, you will certainly get the answer: “Yes.” We were taught to think about others before our own interests and that we should not create conflicts under any circumstances, for fear of being rude.

That’s why, during any kinds of business meetings with Chinese, you will hear a lot of “yeses.” However, that doesn’t necessarily mean they agree with or understand you. When Chinese go silent, they probably deeply disagree, and don’t how to response without creating conflict. Secondly, Chinese and English don’t share the same grammar — so if you ask someone who is not fluent in English a question like, “You must have eaten lunch by now, haven’t you?” In Chinese grammar, we might say “yes I haven’t” or “yes I have,” although neither is a positive or negative answer.

Hence to secure your meeting(s), be sure to double-check with your supplier(s) if they understood you by sending a formal email after the meeting. Putting everything in writing keeps everybody on the same page, and eliminates unspoken doubts. A lot of Chinese have pretty good reading and writing skills, but terrible listening and spoken skills.

Do job titles mean anything?

Job titles often have a completely different meaning in China. When you are a manager in the West, it means that you have experience, you (probably) know what you are doing, and you are authorized to make decisions. In China, someone could have just graduated from high school and be called a sales manager. Why?

As we mentioned before, face means a lot to Chinese people. Titles are a way to show others status within the company, hence people like to introduce others with their titles: Rachael Chueng, CEO of X company; Jeffrey Lee, General Manager of Y company. Meanwhile, a lot of Chinese business people also make up various titles just to make themselves look good. Go through the business cards you’ve collected after any Canton Fair visit. You will probably find that a surprising amount are in senior management or above, at least according to their titles, suggesting they are veterans in the field. Unfortunately, that may not be the case. Unless you are dealing with a well-organized or multinational company, titles in China usually are nothing more than an empty boast.

So what can you do?

Get as much information as you can from the person giving you their business card, grilling them about the company culture, history, and details of their products. If the person you are dealing with is not familiar with any of these, there is no way they are the actual manager. Instead, check out who they defer to or ask when they cannot answer your question(s), as that is most likely the person you should be dealing with directly.

Who’s the boss?

While Chinese can make up all the titles they want, they can’t fake who’s the boss. It is very important to recognize who is the dealmaker within the company. Even though the feudal period of China might be over, its rigid hierarchy system remains. The person who has the highest rank within a company simply means power and authority. They are the person who can make decisions and get things to happen, be it settling on price, lead time of production or the quality of the product. Better yet, they can make your order the priority.

If you are dealing with a big company, where the boss probably won’t be in every day, focusing on your deal, finding out whom the boss trusts is just as important. You don’t want to waste time dealing with someone who needs to report back every detail, going round and round with the same problem or question, eventually sabotaging the whole deal. Then you will have to start all over again, finding a new supplier.

Status of the Boss. East vs. West By Yang Liu
Status of the Boss. East vs. West By Yang Liu

Contract limitations

While you should definitely put down everything you have discussed with your supplier(s) in the contract, it would be smart not to be fully dependent on all the specifics, especially with the timeline.

Victor Poon, general manager of one plastic manufacturer, shared one valuable piece of insight with us, after over a decade of experience in China: ”The biggest concern of mine when it comes to dealing with Chinese suppliers is that many of them cannot meet the deadline.”

The concept of “contracts” in China is different compared to a lot of developed countries. Between Chinese, buyer and sellers could and do adjust the terms after the order has been made, and even after production has started. If you expect your supplier(s) to strictly follow the contract — and I am sure you do — make sure to be upfront about that expectation, so that they understand the importance of it. Meanwhile, keep in touch with them, and frequently asking for an update can certainly minimize any delay of your products.

Avoid sensitive topics

It might be more than normal for you to discuss politics and share whatever opinion(s) you have regarding any topic back home. However that is not the case in China. Topics like Tibet, Taiwan, the Tiananmen Square protest shall be avoided under any circumstances. China is a country with one party, and there is a huge gap between the authorities and civilians. By asking political questions, you are very likely to offend your Chinese supplier(s) without knowing what you have done.

Moreover, since the guanxi (personalized networks of social and professional influence, a central idea in Chinese society) is very complicated, you never know if the person you are speaking with has any related background.

So if there’s anything you are desperate to know, Google it before entering China. Or if you really want to know about something from a local perspective, talk to someone you can trust in private, rather than just blurting things out and risking an upset (N.B. As you might be well aware, many platforms like Google, Facebook, Twitter, and Gmail are all blocked in China)

Last bit of advice?

Hire a local interpreter who has a good reputation of being able to precisely deliver your messages and be on your side — quite often, Chinese suppliers will try to work under the table with the interpreter, cutting them in to get a better deal from you. Moreover, make sure this someone who knows how to deal with Chinese suppliers, can see through the cliché, and put their foot down on your behalf.

Shall you have any question(s), please leave a comment below or send us an email: or contact us here.

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