As a general rule, when you are dealing with Chinese business people it is best to hire someone with some sort of ties to them so that you can gain some leverage into their social network.

1. THE IMPORTANCE OF
RELATIONSHIP BUILDING
NEGOTIATING IN CHINA
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As a general rule, when you are dealing with Chinese business people it
is best to hire someone with some sort of ties to them so that you can
gain some leverage into their social network.
A large part of the Chinese society is centered around guanxi, which is
the concept of building personal relationship with people that you can
give and receive special favors from.
As an outsider you are immediately at a disadvantage unless you can
increase the level of trust which is ultimately at the heart of this issue.
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Cultivating guanxi with your potential business partners in China can be
helped along by hiring people that are already close to them as part of
your team, or by developing relationships with some of their key
contacts.
This is not uncommon to the way that business is conducted
throughout the world but in China the intensity of this practice is
greater.
The sense of guanxi is a powerful tool that you can leverage by
spending time cultivating the key relationships with all of the business
people that you need to know.
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The normal business practices aside, the Chinese will trust you more
once you have cultivated the relationship with them rather than just
signing a binding contract.
This method continues due to the fact that China’s legal system in
underdeveloped and under-enforced.
Once you have gained the trust through guanxi your business
interactions will become a lot easier as they will go above and beyond
to help you and your business.
Don’t forget that they will also expect something in return for any
favors that they provide for you.
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Just as the trust of a handshake has been replaced with a mountain of
paperwork in the western business world, China’s legal system is
improving.
But the speed at which they are improving will leave plenty of time for
the concept of guanxi to infiltrate another generation or two. Until the
legal reform makes this kind of inner circle business relationships more
flexible and open, you have to play by the rules that are dictated.
Trust is the lynch pin that can expedite and alleviate all of your business
transactions throughout the world, but in China you need to manage
your network and ensure that you have multiple guanxi links to your
business partners to maintain a close bond.
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KEEP IN MIND THAT ANY FAVORS THAT
YOU RECEIVE, EVEN IF YOU DIDN’T ASK
FOR THEM, HAVE TO BE RECIPROCATED
TO MAINTAIN THE RELATIONSHIPS.
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7. For additional information about Business with China
please visit www.China-Business-Connect.com