2018-05-09 12:00:13How to Make More MoneyEnglishDiscover how your business can be successful at doing business in China. Learn how the Chinese business culture is different from that in...https://quickbooks.intuit.com/ca/resources/ca_qrc/uploads/2018/04/Employees-Discussing-Best-Business-China.jpghttps://quickbooks.intuit.com/ca/resources/money/tips-business-with-china/Tips for Businesses That Want to Do Business With China

Tips for Businesses That Want to Do Business With China

2 min read

If you sell products in Canada, opening your doors to China could be a big opportunity. This massive country is home to more than 1.39 billion people, many with an appetite for shopping — in fact, during 2017 retail sales of consumer products in China grew by a whopping 10.2 percent. In comparison, Canadian retail sales grew by only 6.7 percent. By getting into the Chinese market, you have the opportunity to find new customers and boost your profits.

Be Patient With the Process

In Canada, you’re probably accustomed to a fairly simple process: identify a business partner, negotiate a deal, and sign a contract. In China, things are different. Before Chinese companies make a deal, they like to build trust, which takes time. That means you might be invited to quite a few more meetings than you expect, many of which are quite long. And that’s not all — don’t be surprised if you’re asked to dinners and social events. This is all part of the Chinese concept of "guanxi": building a network of relationships that’s used for both personal and business needs.

Even if you’re not sure what’s going on at each gathering, it’s a good idea to be patient and good-humoured. Keeping an open mind shows your new international business partners that you respect their culture’s values and traditions. Taking these opportunities to make friends and understand Chinese business traditions can help you in the long run.

Keep Boots on the Ground

If you’re serious about branching out to China, you need to spend time there. This is especially true in the beginning stages, when possible partners expect to meet you and build relationships. Unless you happen to be fluent in Chinese, it’s a good idea to hire a translator. This person can come to meetings and help you understand what’s going on. With this deeper insight into the culture, you can avoid embarrassing missteps and establish your business faster. Being there in person can also help you make personal connections with professional contacts, which is an important part of doing business in China. In many cases, investing time up front establishes long-term relationships that are very profitable for your company.

Know How to Pitch

As a business owner, you know that a great sales pitch is tailored to the needs of the other person. The same goes in China. Before you can convince Chinese businesses to work with you, it’s important to know what they value. The culture as a whole values saving money and making long-lasting purchases. If you make luxury handbags, you might highlight the quality of your products rather than how they look. As a Western company selling in China, you can be more successful by getting to know the culture before you start to pitch.

Understand Chinese Etiquette

Like any country, China has its own etiquette. Chinese professionals certainly don’t expect you to know all of their rules — but you can get ahead by following as many as possible. When you meet with a business, research the management hierarchy in advance. Then, show great respect for the highest-ranking person. If you’re bringing a team, your top person should do most of the talking. Always accept gifts, and speak with local contacts to know when your Chinese partners expect gifts from you. Other basic etiquette tips include addressing people with their titles, avoiding political discussions, and waiting for senior people to eat before you do.

As you start building professional and social relationships in China, more opportunities open up for your company. Over time, your efforts can lead to partnerships that build your bottom line.

Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.

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