Doing business the Chinese way

To date, thousands of Africans look to China to buy goods, raw materials or machinery, find investors or forge business partnerships. Easy as it seems, the whole experience cannot be a walk in the park.

Shadrack Tsheko, an aspiring businessperson, learnt the hard way after attempting to source material from China, and rope in Chinese investors. Quite frankly, the Chinese have unique business operations. While in our local social landscape, business relationships are built, and deals sealed over beers and whisky, or a restaurant meal, amidst back slapping, jokes, over-eager handshakes and quivering smiles, the Chinese do things in their own way. It is perhaps understandable that the Chinese would be guarded in business, particularly when dealing with other nationalities.

It’s not personal; they don’t know you or your intentions. What if you pull a fast one on them? On the plus side, when trust is gained and maintained, a business relationship with the Chinese is likely to flourish. The Chinese want to build trust first, before plunging into any business transactions. They especially want to be valued and acknowledged. In China, there is a widespread practice called guanxi. Loosely translated, this means solid relationship. This relationship is built through regular social dining and business transactions as well as the exchange of gifts and favours. In our culture, giving gifts may be perceived as bribing or a form of corruption, but it’s normal practice for the Chinese.

The Chinese also value loyalty. Ling Xiu, a former agent who has now started operating his own local stores, says it’s advisable to use the same company, and refer other clients. “It’s also important to conduct good business to maintain trust. One mistake and the relationship will suffer because trust will be eroded,” he says. Xiu advises that when making business dealings in China or with the Chinese, it would be a wise move to not only do research on the business environment in the country, but to also find an agent or a close friend familiar with the business conduct of the Chinese.

Tsheko noticed that in practice, the Chinese are “infamous” for lengthy meetings and protracted negotiations, as well as their strict following of protocol. In a meeting, the highest ranked person in the company enters the room first. Introductions are then made, also according to rank. The host is expected to sit to the left of the most important guest. All those in attendance sit facing each other, seated according to seniority. The ranking of the individuals is very important in Chinese business corporate culture. The most important person in the company-whether the director or CEO- is given the utmost respect. They also accord respect to the elderly. The Chinese aren’t necessarily sexist or chauvinist in business.

Perhaps all thanks to founding leader of Republic of China Mao Tse tung, who once famously noted that, “Women hold the sky.” The Chinese will accord a woman who holds a high position exceptional respect and honour, never belittling her based on gender. Xiu suggests that it helps to learn a Chinese language, Mandarin, to ease communication. It also reflects well on you, as it shows an interest in the party you are dealing with. The Chinese also have “dodgy seeming” ways in their business workings. For one, Chinese tactics to induce the other party are temper tantrums and an exaggerated sense of urgency, which might startle the other party, especially if they are not familiar with Chinese business practices. The Chinese also believe in saving face. They never want to embarrass, humiliate or openly turn down the other party.

If they want out of business connections, they are likely to stall progress. After all, actions speak louder than words. Be intuitive because sometimes you might think they want out, whereas there are actually genuine delays. When negotiating a deal, expect a lengthy round of bargaining. The Chinese will however be offended by subjugating your position by setting deadlines. In some cases, things don’t always go according to plan. However, “No” is akin to a vulgar word to the Chinese. If there are endless excuses, chances are you are being told “No” in a polite manner. In one issue, Forbes magazine explored the concept of ‘face’ in the context of the Chinese business culture. Face is a total of honour, or maybe even respect. To the Chinese, in all that you do, you are either gaining or losing it. The article noted that ‘face’ could be gained in several ways like offering compliments or other shows of respect. The article noted that accomplishments and avoiding mistakes always save face. It’s important to note that losing one’s temper will result in a person losing face, or when a weakness or failure is publicly exposed. 

In cases where business connections flop, never take the blow personally. The Chinese are fair and firm, and it helps to also have that approach. Never be too smart or sly, as it might backfire heavily. Xiu offers other small titbits to keep in mind when conducting business with the Chinese. “In most cases it’s appropriate to dress conservatively. Revealing or over the top attire is considered in poor taste,” he says. He hurriedly notes that the concept of ‘African time’ should be trashed, as not honouring time could make one lose face. “Obviously most meetings need to be by appointment. All the people should be early or on time. The Chinese are open to small talk but one’s demeanour should be calm, no hand gestures, pointing or raising one’s voice.” China has come a long way since its days as an isolated communist nation, to a largely open economic driven nation.

Three decades ago, no one would have imagined that China would to date, have grown its GDP at a record average of ten percent per year. While China was the second largest economy in 2010, it is expected to surpass superpower United States of America in 2025. In an awe-inspiring turnaround, China has since the 1990s, lifted approximately 500 million people out of poverty, creating one of the largest economic “miracles” of the past two centuries. Since China implemented the open and reform policy, the country’s economy has soared.

Last modified on Monday, 19 January 2015 12:57

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