NEGOCIATING WITH CHINESE PEOPLE

• Due to the vastness of China, different Chinese have varying business styles.  The Cantonese tend to be more Westernized due to the influences of Hong Kong and constant contact with Western traders for hundreds of years. They are more accustomed to doing business with foreigners and are more efficient.  However, Cantonese business people can often be more adamant about having things their own way and so foreigners should be firm about their position in a negotiation. 
• Chinese usually conduct business over lunch and dinner, and deals are often concluded over a meal.  Entertaining is a critical part of Chinese business culture.
• Chinese pay a great deal of attention to details.  Most negotiations are divided into two phases: technical and business issues.  The Chinese will utilize their technical experts to focus on the technical phase until they are satisfied with basic issues or quality and usefulness.  Make sure to include at least one technical expert in your negotiation team. 
• It should be noted that the Chinese often hesitate to provide information out of concern that someone will use it against them.  Use mutual contacts to assist if you are concerned about establishing trust and credibility with your Chinese counterpart, if negotiations stall, or you encounter disagreements.
• Government officials who are responsible for negotiating deals often do not have the authority to commit financial resources.  Be flexible and creative in your approach, but do not lose sight of your business interests.  In many instances, even small changes to existing agreements cannot be made without the approval of senior officials.
• Chinese do not like to say no or to be the bearers of negative news.  They will hint indirectly in the conversation.  Similarly, you will hear a yes response to almost everything.  You should be careful of these empty yes as it may not always draw positive conclusions.  Verify what has been said to you.  It is important that all parties maintain "face".  If you think the answer to an issue is really no, verify your feeling by asking questions that can be answered positively.

Be prepared for tough negotiations.  Adhere to your principles and objectives. Maintain a quiet and dignified manner.  If problems develop, you should be firm about your limits and your willingness to work with your counterparts to find a mutually agreeable solution.

BUSINESS MEETINGS IN CHINA

• Chinese usually greet one another with a slight bow or nod of the head.  In business and with foreigners, a handshake is common upon greeting and departure.
• Arriving early indicates respect for the host.  Although the Chinese are not always on time, punctuality is viewed as a positive asset in others.
• Chinese pride themselves on holding their feelings inside, therefore, they may not smile at a first greeting or as often as people do in some other Asian countries.
• Business cards, called name cards (ming pianr) by the Chinese, are presented when everyone first meets.  They should be given and received with both hands. 
• It is advisable to hire a translator.
• Chinese have a high regard for rank and seniority.  The Chinese will be impressed by and are usually more attentive to senior representatives of foreign firms.  Ranking your company can help to impress the Chinese, especially if you are the biggest or the oldest.
• In China, the family name precedes the given name, which is occasionally followed by the second name or the western equivalent of a first name.  For example, Huang Hua would be called Mr. Huang, and Hua would be his given name.  However, some Chinese will switch the order of their names when they are dealing with foreigners.  Further, many Chinese adopt given names, many of which are Western names. 
• It is important to establish a smooth business relationship and friendship.  Trust and cooperation are key.   Meetings often begin with small talk over tea, and appropriate topics include the weather and your recent travels. Then, will be built on to more serious topics.  It is important to be patient.  The Chinese tend to maintain a level of formality in the early stages of a relationship.  This fosters respect for each side and ensures that contacts will proceed harmoniously.  To become informal too quickly would upset the balance the Chinese require to develop a meaningful business and personal relationship. Avoid discussing political and human rights issues.  These topics can be very sensitive and may place your Chinese counterpart in an awkward position because Chinese people are not allowed to publicly criticize the government.

Gift are not required or expected at initial meetings.  You may present a small sample of your company's product or an item with a corporate logo.  However, anything more elaborate or expensive will be inappropriate.