Chinese Business Etiquette
These tips on Chinese business etiquette are not intended to stereotype Chinese people or insist that all Chinese businesspeople and companies operate in exactly the same way. Rather, the tips serve as a guide, providing you with greater cultural awareness and understanding of Chinese cultural norms when it comes to doing business. Remember to always respect the culture, value and traditions of your prospective partners.
Chinese businesspeople like to do business with people they know and will frequently use intermediaries for introductions. To make the first contact, try to be introduced by an intermediary known to both sides, as this will indicate that you are trustworthy and good to do business with. Rather than introducing yourself, it is best to be formally introduced by a third party.
The correct form of greeting in China is a handshake and a nod or slight bow. Whereas in Japan, hands are kept to the sides and bows are from the waist with a straight back, in China, you should bow from the shoulders.
Following the initial greeting, you should carefully present your business card. Ensure that you have a good stock of these because you will be giving them out a lot! Ensure that you have a professionally translated bilingual business card, and when giving it to your Chinese associate, do so with two hands with the Chinese translated side facing up. Include details such as your name, qualifications and position; rank is very important in China and writing these details on your business card will help your associates to ascertain your rank. The most important thing about the ritual of giving and receiving business cards is that you don’t stuff it in your bag or pocket without looking at it. Take it with both hands with a small nod to acknowledge your respect and place the cards carefully on the table – not only does this show respect but it’s an excellent way to remember people’s names!
Something to remember in China is that people’s names are written in the opposite way to in the Western world. If somebody is called Liu Jianguo, this is in fact Mr. Jianguo Liu in the Western world, with Jianguo being that person’s given name and Liu their surname. Sometimes, those who travel frequently or deal with Westerners in their business lives adopt a Western name, and might ask to be referred to by that name.
Appointments are expected for all business meetings and should be made in advance. When setting up a meeting, ensure that you send as much information as possible to your Chinese counterparts in advance and get any documents to wish to share with them professionally translated. It is quite common to have to wait until the last minute for confirmation of your meeting. You must ensure that you are on time for your meeting, as lateness will be frowned upon. If you are going to be more than ten or fifteen minutes late, you should call ahead and apologise and advise them of when you will arrive.
When you arrive, wait to be greeted and shown where to sit. Business meetings are hierarchical in China, and the most senior person will enter the room first and people of different ranks within the company will probably have a designated seat. When you reach your seat, do not sit down immediately but wait until your host or the person occupying the most senior position have taken their seats.
Don’t be surprised if a lot more time is dedicated to social niceties than you are used to, and if you are asked personal questions about your age, marital status, children, family or income. Even though these are considered private matters in the Western world, in China, this is part of the process of getting to know potential business partners and is done to seek common ground.
When negotiating business in China, certain aspects of Chinese culture can lead Westerners to believe that they are on better ground than they actually are. For example, when people are speaking in meetings, it is common Chinese practice to nod one’s head – however, this means that they are listening and attentive, not that they necessarily agree with what is being said. Similar to this is the Chinese concept of “face”. Disagreeing directly with somebody, becoming frustrated or starting an argument are all ways that you can cause yourself as well as your Chinese counterparts to lose face. This means that Chinese businesspeople can be reluctant to openly disagree or express negative opinions, which could lead you to believe that they agree with you and your ideas when they may not necessarily. Watch out for evasive terms and body language and expressions such as “It is under consideration” or “We are not sure”. You should also adjust your behaviour accordingly and avoid direct disagreements that could cause you and those around you to lose face.
Similarly, lavish compliments and respect to business partners are a way of gaining face, and this aspect of Chinese culture can make those from the Western world believe that business dealings are going to be easy because the atmosphere is so cooperative and friendly. It is important to learn to read between the lines, because context and body language is very important to understanding what is actually being said.
Negotiations in China can take a lot longer than in other cultures. It may require several meetings rather than just one to negotiate, and the getting-to-know-you period extends for longer than in the Western world. An understated and modest approach is better than hard-sell, and getting visibly frustrated with a lengthy process will cause you to lose face and harm your business deal. You must be patient and listen to what is being said – there may be a lot of lengthy speeches and it is important to look attentive and nod to show that you are listening. Appearing friendly, reasonable and diplomatic can speed things along as negotiations will stall if you are perceived as being unreasonable or arrogant.
Remember, a contract (even if signed) is mostly considered as a draft that is subject to change, so don’t be surprised if negotiations continue after you have signed.
Business meals and social etiquette:
Usually, the party extending the invitation to dine pays the bill. Depending on the formality of the meal or social event, there may still be a seating arrangement, with specific places for the host and honoured guests. If you are the guest of honour, expect to have to make a toast, usually after the host has already done so.
The Chinese are typically very hospitable, so expect a lot of food at these banquets! It is polite to try a bit of everything and compliments on the food are expected. Praise the food and good taste of your host. If you are full, leave a little food on your plate, as an empty plate is an indication that you are still hungry and want to eat more. Using chopsticks is always the best bet, but if you really can’t use them, usually knives and forks will be provided if you ask. When eating, you are expected to hold the bowl close to your mouth, mix sauce and rice and eat it all together. Bending over your bowl is a breach of protocol. Drinking is a big part of Chinese dining, but you should not pour your own drink – instead, let your host or those around you pour your drinks, and reciprocate by pouring drinks for others.
Remember, meals are considered as social events, so leave the business aside for later, or follow your host’s lead as to appropriate dinner conversation.
Personal relationships are very important to business, and building up a network of personal relationships is the way that you will speed things along and get things done in China. Guanxi is the Chinese term for this network of personal relationships. Guanxi can be built through social occasions such as business dinners and after-work drinks, as well as through the giving and receiving of gifts.
Gift-giving is a big thing in Chinese business culture, and giving a gift also gives someone face (called mianzi). Gifts should be distinguished from bribes – gifts help to build guanxi and demonstrate respect and gratitude for your host or business partner, whereas a bribe is considered something that you feel might help you get the business done quicker or seal the deal. A rule of thumb is to not give anything that is obviously highly valuable – small touches demonstrating consideration and respect for your hosts are more what giving gifts is about. Gift-giving is attached to the idea of reciprocity and favours, so if you give or receive a gift, you can expect to return the kindness or have it returned to you. This idea of reciprocity is very important in building business connections.
Good gifts are often those that come from your country of origin or things that cannot easily be purchased in China. For example, alcohol or tobacco products from your country, especially those of a recognisable brand, will be warmly welcomed. Gifts of your home country’s food are also a good idea. Gifts to avoid include clocks, associated with death, or anything in sets of four as this is considered unlucky. Remember that the concept of reciprocity and favour-giving mean that you should give gifts of equal value to those received, otherwise you risk your relationship being damaged.
Both men and women should dress conservatively in dark, muted colours. For men, a well-cut business suit and high-quality tie is a safe bet, and for women a dark skirt or trouser suit with flat heeled shoes is most appropriate. Wearing a high heel, especially if your hosts are shorter than you, is considered disrespectful. You should also never wear open-toe shoes. Women should also ensure that jewellery is understated and elegant – large earrings and chunky necklaces are a no-no. You should never wear jeans, even on Friday, as the concept of a “casual day” does not exist in China.
If in doubt, err on the side of caution and dress more conservatively than maybe you would otherwise – overdressed is better than underdressed!
Don’t let it happen to you!
A German businesswoman flies out to China for a meeting. After a lengthy negotiation process, terms are agreed and a contract is drawn up. The German woman is very pleased with the terms and how the meetings have gone. However, at another meeting, her Chinese counterparts recommence negotiations and start debating points in the written contract. The German businesswoman is confused and upset and does not want to start debating about terms that for her, were set in stone. She argues that this is unfair and notices that business relations seem to have soured after this.
If the German or the Chinese parties involved in this story had known more about each country’s business etiquette, they would have been aware that the concept of contracts is very different in Germany and China. Whereas in Germany, a written contract is a formal, binding agreement, in China it can be seen as an agreement that holds for that stage in the process which can be amended in the light of new circumstances. The German woman would also have known that publicly arguing or disagreeing can cause an embarrassing loss of face in China and lead to a cooling of an otherwise successful relationship. Here at Planet Veritas, we provide cross-cultural training to ensure that you know as much as possible about the business culture of your country of choice. It could literally make or break your deal, so contact us today to find out more.