16 tips for doing business in China

When doing business in mainland China, you're likely to encounter some challenges quite different from those you'd face in the Western business environment. This article outlines three main challenges of doing business in China and provides 16 tips for dealing with them. This information comes from my own experience during more than 10 years of dealing with Chinese companies for my import and wholesale business and on behalf of some of my customers.

The three main challenges for doing business in China:

1. Language. In mainland China, the business language is English. However, the Chinese business people you will meet have learned the language from textbooks. That means they will be very good at writing and reading but their listening comprehension may lag behind. For this reason, you will need to avoid using complicated words or phrases. Speak simple English and you will avoid many problems and misunderstandings.
   
   
2. Short-term business mentality. Chinese business people often have a very short-term mentality about business relationships. For instance, they don't see business relationships as long term. You can assure them that you are looking for a long-term business relationship, and they may say they agree, but it's obvious they believe that the customer will sooner or later go to someone else. Similarly, they are likely to believe that if you don’t buy or invest with them, somebody else will. Of course there are exceptions to the rule. I suggest that if you do find a long-term mentality supplier or partner, you stick with them. This will save you a lot of time, effort and money.
   
   
3. The meaning of quality. You'll find that "quality" is the most used word in Chinese business (apart from “yes," "no" and "sorry"). Because everything is said to be of such high quality in China, you'll soon realize the word itself has lost its meaning. As Timothy Ferris says in his book The 4-Hour Work Week, the more you use a word, the more it loses its meaning. What you need to know is that in China "quality" often means that something looks like it is high quality — not that it works as well, or wears as well, as an actual high-quality item. Because the business and industrial emphasis in modern China has been on making copies of existing products (rather than inventing or creating products from the ground up), their criteria for judging product quality is different.
   
   

Here are 16 suggestions I believe will help you do business in this challenging environment:

1. Be prepared to change course from time to time.
   
   
2. Be prepared to face some of the hardest and longest negotiations you’ve ever seen.
   
   
3. Be prepared to always have an ace up your sleeve.
   
   
4. Be prepared to have patience, a lot of patience (even more than with your spouse!).
   
   
5. Be prepared to tell some white lies.
   
   
6. Be prepared to make friends.
   
   
7. Be prepared to give respect and receive respect.
   
   
8. Be prepared to be skeptical about much of what people tell you.
   
   
9. Be prepared to not judge people; keep an open mind.
   
   
10. Be prepared to acknowledge that in most cases people regard you as a short-term customer.
    
    
11. Be prepared to accept that in most cases people won't recognize the value of a lifetime customer. They haven't had that experience.
    
    
12. Be prepared to accept people as they are.
    
    
13. Be prepared to have a "Plan B" in case all else fails.
    
    
14. Be prepared to accept that there will always be someone who buys more cheaply than you.
    
    
15. Be prepared to accept that there will always be someone who buys more expensively than you.
    
    
16. Finally, be prepared to know that China is unique.
    
    

Doing business in mainland China is a challenge; I hope this article will be the first step towards your success.