As we know, China has been named the world’s second largest economy since 2010. In 2021, 143 Chinese companies were listed in the Global Fortune 500, and this number has been increasing every year. As a result, many overseas companies and individuals choose to do business with or in China. However, if you have no experience in dealing with Chinese business culture, you might find it tricky and slightly confusing. It has very distinct differences from the western way of doing business.
In this article, we would like to introduce the common concepts of Chinese business culture. Also, we will give you tips on how to accommodate them. Of course, this is your choice of either following this advice or not. However, understanding your business partners will definitely make it smoother to deal with them.
The concept of ‘face’ (‘Mianzi’ in Chinese)
This is something Chinese people are pretty sensitive about. By ‘face’ we are talking about respect and prestige in other people’s eyes. Losing face, especially in front of other people, by being criticized, intentionally embarrassed or accused of being incompetent is the worst.
If there’s something you disagree with while communicating with your Chinese partners, you’d better not express it directly in front of other people. Don’t make inappropriate jokes. Every culture has a different humor perception. Some things you find funny may be offensive to other people.
Relationships (‘Guanxi’ in Chinese)
It is all about who you know. As China is one of the strongest collectivist societies, building relationships with people who might be helpful to you in the future is definitely a thing. Chinese people don’t burn bridges and don’t make eternal enemies.
It is normal if you don’t reach an agreement during the first interaction and 2 years later you will get a call from this company or person. Relationships are like investments – they might bring you benefits in a long term.
Ambiguity and indirectness as a part of Chinese business culture
It applies to the communication style of Chinese people. Very often it’s hard to get a straight answer. Like many other things in China, it relates to the fear of losing face and another fear of losing an opportunity by saying a firm ‘yes’ or ‘no’. There’s always a space for negotiation, and everything can change at any time. So don’t be too judgmental, stay patient and keep a positive attitude. Pay attention to the body language and facial expressions of your partners. Sometimes they can tell you more than verbal signs.
Restaurant business meetings
Unlike in the western business culture, in China, many business meetings take place in restaurants, and not in offices. First, Chinese people appreciate good dining. It is a big part of their culture, and sharing it with their foreign partners is a special pleasure. Second, Chinese people will not do business with people they barely know. To get to know you better, they can invite you for dinner. Communicating in a relaxed and friendly atmosphere can give you more information about your partners than just a ‘dry’ office meeting. It also helps to build trust.
So Chinese people invite you to the business dinner, don’t say no, appreciate the Chinese hospitality, praise the food, have small talks and try to learn about your partners as much as you can, just as they do.
Gifts giving in Chinese business culture
All people like receiving gifts, but in China, gift giving is a sign of respect and appreciation, especially if you do it in public. So when you meet your Chinese partners, don’t forget to bring some presents, maybe some souvenirs or local specialties from your country. They will notice and appreciate it. Small signs of attention always make the interaction smoother and more pleasant. Make a calendar of major Chinese holidays and don’t forget to send messages to your partners.