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Show respect for the local culture when doing business in China

On Behalf of | Dec 5, 2022 | Business Law

Here in the United States, many people conduct business on the golf course or in a coffee shop to achieve their goals.

In China, building strong working relationships is essential. Newcomers must understand that respecting the local culture is how to succeed in business in that country.

Understanding the Chinese business culture

Westerners must acknowledge the Chinese hierarchy where managers and above expect respectful treatment. They have prestigious roles in business and expect instant obedience from workers. The concept of “saving face” is important. In China, disagreeing with something or pointing out someone’s mistake might be a grave business error. On the other hand, giving credit for good work is one way to save face when you are trying to cultivate a business relationship.

Dealing with the state

Westerners must keep in mind that the Chinese government owns most of the country’s assets. The Chinese people own less than a quarter as compared to the U.S. where assets are privately owned. As a result, most companies wishing to do business in China will often have to negotiate with the government. Cutting through the resulting red tape takes time.

Accepting the slower pace

In addition to the interaction with the government, westerners must understand that doing business in China is a slower effort overall. In general, business in the western world moves at a fast clip, but in China, it may be necessary to meet with contacts several times before closing a deal. For example, it is essential to accept invitations to enjoy cocktails or dinner. Newcomers to doing business in China must understand that patience is vital to business success.