Business in China is conducted on a much more formal level than in many other countries, especially when compared to Europe or North America. Custom and ritual should be observed with the Chinese people for the best chances of establishing successful working relationships.
Even if you are with people that are accustomed to dealing with guilos (foreign devils: a common way of referring to foreigners), showing respect for local customs and practices will be appreciated.
When two parties are meeting, the leader of each would be expected to enter the room first. Take note of what the other side does and – to avoid creating confusion – make sure you do the same. The two principles would normally be seated facing each other, with other individuals arranged either side in their descending order in terms of their hierarchy. The most important person will never sit with his back to a door or mirror and should have a good view of the whole room.
A meeting should normally commence with a period of polite conversation before getting down to business. If this does not come naturally to you, think of some questions you could ask in advance (steering away from topics which may be sensitive, such as politics or criticism of local culture, is a wise precaution). Be careful with jokes and humorous comments, as some things may not translate well. However, the Chinese love intelligent humour and do appreciate pleasant, relaxed company, especially during a business lunch or dinner; so don’t try to be too serious all of the time.
In some first meetings you may not even get ‘down to business’, especially if the meeting is based around a social event such as a meal or a visit to a museum or other cultural site. Don’t be concerned as your hosts may just be trying to work out whether you are the right person to do business with. If this is the case and they form a positive opinion of you, they may be ready to sign a deal straight away in the second meeting!
If you’re used to sliding business cards across meeting tables, make sure you bury the urge when you are in China – this is considered to be offensive. You should present your card always using both hands with the writing facing the recipient. When receiving a card, always use both hands, look at the information on it for a brief period and then lay it carefully on the table in front of you. Don’t write anything on a card in front of other people. Don’t just take it and stuff it immediately into a pocket or wallet – this signals a lack of respect for the person. Keep a good supply of business cards at hand as you may get through more than you expect.
It may be appropriate in many instances to bring a gift with you to meetings; it is very common for this to happen at a first business meeting. On many occasions you may receive gifts from people you meet, as this is a signal that the giver is keen to build a working relationship. A gift will probably not be opened in your presence, nor should you do so; this is to signify that the act of giving is more important than that which is given.
Do not give a clock, handkerchief, umbrella or white flowers (especially chrysanthemums), as all of these items are associated with death or sorrow. Avoid sharp objects or anything associated with 4, the former signifies the cutting of a relationship and the latter is unlucky. This is difficult area – seek advice if possible. Products from where you come from may be appropriate and appreciated.
When it comes to agreeing and signing contracts, the Chinese have – in many cases – a circuitous approach to negotiation and contract enforcement. Until a contract is signed you will find that any point in an agreement can be reopened, even if you were under the impression there was previously an agreement on that item. Be prepared to have to revisit different aspects of a deal several times; this can be frustrating, especially when you are closing what you see as the final point of discussion and the other side suddenly reopens another part of the deal.
You might also find that the Chinese has a different approach to the sanctity of a signed and sealed deal. It is not uncommon for an agreement and its terms to be renegotiated ‘after the fact’.