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Article Title:
Negotiating Business In China

Article Description:
Just like Confucious and Lao Tsu (who was the inspiration for 
Taoism) when negotiating for new suppliers or marketing to the 
Chinese you must remember that they are more conscious of seeking 
'the way' rather than the truth.

Additional Article Information:
985 Words; formatted to 65 Characters per Line
Distribution Date and Time: Thu Apr  6 01:05:21 EDT 2006

Written By:     Gerard Brandon
Copyright:      2006
Contact Email:  mailto:[EMAIL PROTECTED]

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Negotiating Business In China
Copyright © 2006 Gerard Brandon
Guru Manager

Just like Confucious and Lao Tsu (who was the inspiration for 
Taoism) when negotiating for new suppliers or marketing to the 
Chinese you must remember that they are more conscious of seeking 
'the way' rather than the truth.

There is always an underlying need to find the Yin and the Yang 
to create a better environment built on respect and morality.

It is likely that they will express their moral values in their 
negotiating style. Being more concerned in finding a means to an 
end, with the process, rather than defining the goal within any 
negotiation discussions.

A Compromising Solution:

The best outcome is obtained through haggling, providing 
opportunity for both sides to compromise, where everyone wins and 
no one loses. This process cannot be cut short (haggling is a 
pre-requisite) and a compromise allows both sides to hold equally 
valid positions. Western business mentality tends to argue the 
point strongly and get angry. The Chinese tend to haggle, in fact 
they believe this is the only way forward.

The Big Picture:

Consider the Chinese Pictographic language. It is not essential 
that you learn Mandarin, but because the Chinese are accustomed 
to the many thousands of pictoral characters rather than letters 
they tend to think more in terms of an holistic approach to the 
processing of information. As a result Chinese are more capable 
of seeing The Big Picture, while non-Chinese tend to focus on 


The Chinese wariness of foreigners has been learned the hard way. 
Long and violant attacks over the centuries have had their toll 
from abroad and even civil wars. This leads to cynicism and 
contempt about the rule of law and rules in general.

It has been said that the Chinese trust only in their families 
and their bank accounts.

Personal Connections (Guanxi)

To the Chinese it is about social respect. He who knows the 
highest guy in the place usually wins.

The Intermediary (Zhongjian Ren)

Business deals in China don't have a chance without the Zhongjian 
Ren. Suspicion will be the biggest issue you deal with on any 
first meeting. Western Business people tend to trust until we 
have reason not to. This is the complete opposite in China 
Business. Trust must be transmitted via the Zhongjian Ren. He 
must pass you along to his trusted business associates. Therefore 
it is important tht you seek the person or institutions that has 
personal links to your target or executive

It is crucial that Chinese interpretors need to be native 
Chinese, as only they can read and explain the moods, 
intonations, facial expressions and body language during formal 
negotiation sessions. As no one wishes to lose face or cause 
loss of face to any party, if you ask what they think of your 
proposition, your opposite number is likely to come back with 
kankan or yanjiu (Let us take a look - or Let us study it - even 
if they think the proposal stinks.

Shedhui Dengji (Social Status)

Formality is a must. Informality will not go down well in a 
country where Confucian values of obedience and deference to 
one's superiors remain strong. This is especially heightened to 
Westerners, so never let the formalities drop. You will insult a 
Chinese Executive if you your rank does not equal or exceed his. 
It raises doubts about the sincerity of the approach and may lead 
to no further negotiation and any potential deal simply dying 
before it could begin.

Renji Hexie (Interpersonal Harmony)

Where Western Business can take minutes to size the opposition 
up, the Chinese may take days, weeks or even months getting to 
know and trust you. Be patient, as in the end it will lead to a 
long relationship together. It can include home visits, 
invitations to sporting events or other events, and long dinners 
during which everything but business is discussed. There is just 
no other way to break through. A toast may include the following 
"Let's drink to our friendship! We will have a long cooperation! 
But if you are not drunk tonight, there will be no contract 

Zhengti Guannian (Holistic Thinking)

Chinese think in terms of the whole, while Western Business 
processes tend to break up complex negotiation tasks into a 
series of smaller issues: price, quantity, warranty, delivery and 
so on. The Chinese tend to skip over them and may never settle on 
any one thing. What they really want is long descriptions of 
background and context and will ask a thousand questions. 
Frustrating but necessary for success.

Jiejian (Thrift)

The Chinese save. They will also make their offers with more room 
to manoeuver than you may be used to. Remember the focus is 
ultimately on haggling and bargaining. Don't be surprised at 
their base offering to any counter-proposal. It is a starting 

Mianzi ("Face" or Social Capital)

Reputation rests on saving face. If you cause embarassment or 
loss of composure, even unintentionally, it can be a disaster, so 
be careful to retain all sense of dignity and allow them to hold 
their head high on any deal and not feel hard done by.

Chiku Nailao (Endurance, Bitterness and Enduring labour)

Chinese are famous for their work ethic, but they take diligence 
one step further - to extreme. While we see talent as a key to 
success, they see Chiku Nailao as much more important and 
honourable. Be assured that the Chinese will have worked harder 
in preparing for the negotiations than you will.

Second they will expect longer bargaining sessions: throw in jet-
lag and late-night business entertainment and it can be a very 
exhausting experience. The trick is to act slightly dumb and ask 
questions. A useful tip is to ask the same question again - I 
didn't completely understand what you meant. "Can you explain 
that again?" - can expose weaknesses in the other party's 
argument. Ask why a specific item is important rather than accept 
that it is.

Gerard Brandon is editor of <a href="";>Guru Manager 
Toolkit</a> Founder and former CEO of Alltracel Pharmaceuticals 
Plc, with multiple partners and suppliers in China. Guru Manager 
provides Entrepreneurs interactive tools for building their 
global business.



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