China – the world’s second largest economy is forecasted to account for half of the increase in global consumption by 2030. So it’s easy to see why more Aussie firms want to do business in the region.
But as the recent arrests of 18 Crown Resort employees in China show there’s also potential for trouble if you don’t know how to navigate the nation’s unique business terrain.
Carsten Primdal, the founder of Vantage Compliance & Mitigation, a firm that helps SMEs manage their relations in China, shares some tips on how to make strong ties in the Asian superpower.
“Showing that you have put in just a bit of effort to study the culture gives people that ‘feel-good’ sensation."
Dive into Chinese culture
Primdal’s first piece of advice is to study enough so you don’t make embarrassing “losses of face” in dealings with Chinese counterparts.
“Showing that you have put in just a bit of effort to study the culture gives people that ‘feel-good’ sensation which can lay the groundwork for a long-lasting and profitable relationship,” he says, noting that just giving the food a good go can be enough to get you off to a positive start.
“Trying the food, if you are invited, also gives face especially because often the food ordered is of the more expensive type, so refusing to try it can be seen as a little rude.”
“Don’t expect that two business trips in 12 months will be enough."
China might move fast when it comes to building infrastructure and transport, but forging lasting relationships in business usually takes time.
“While certain things are super-fast in China like the construction of new mega buildings and rail projects, other things take time,” Primdal says.
“Don’t expect that two business trips in 12 months will be enough to support ‘eternal’ friendship. Building up a real relationship takes lots of time and effort. Also, try to avoid telling (business) partners when you are leaving, as a tight deadline can be used against you in a negotiation situation.”
"Test the waters with whoever you engage before committing too much cash."
Get some expert help
Getting an expert with in-depth China knowledge and skills can help smooth your dealings in-country, Primdal says.
One issue, he says, is trying to identify “real experts”, with many fly-by-night operators offering consulting services to foreign companies. His advice here is to test the waters with whoever you engage before committing too much cash.
“As a starting point, the best thing to do is to engage a consultancy who offer this type of part-time support. That allows you to test the waters before a complete immersion,” he says.
“It also gives you the flexibility in employment and reduces your risk of wasting time by hiring the wrong person in your business. These services do cost money though and not many are willing to do it on commission only basis.”
"Your business card is an extension of you."
Get your business cards at the ready
Business cards in China are a big deal. Experts advise taking Chinese language cards with you, as well as understanding how to give and receive them.
“Give it and receive (the card) with two hands and hand it over so that the text can be read by the receiver. Your business card is an extension of you, and similar to maintaining your appearance you want your business cards to present well too,” Primdal says.
“If they are dirty, or grubby, or you ‘throw’ it across a table, it can be mistaken for you not respecting yourself.”
Sam McKeith is Sydney-based media professional. He has contributed to many leading publications including The Huffington Post, The Australian Financial Review, The Australian and BRW Magazine. He was previously a senior reporter at the Australian Associated Press where he covered national affairs.