Negotiating in China

As many things, negotiating in China is so different from how we do in Western countries. Negotiations are usually are longer and include more nuance than ours. The long-term business relationship comes before the immediate result of the negotiation, and it is very important to maintain the parties in face by abstaining from using aggressive tactics or pointing out mistakes. Also, when one point of discussion is renegotiated, the Chinese view all items as reopened for discussion.

Talking about the salary of foreing employers, it is important to know how to negotiate it. In China, those people use to make some big mistakes. They generally have an idea of average salaries for their job sector, but in China, candidates are often going in blind. Because of this, it is important to put in the due diligence and find out for yourself what your job normally pays in China. If you haven’t been asked by the company to relocate, you shouldn’t expect to be paid much more than a local in a similar position. There was a time where foreigners could be paid roughly twice the salary of a Chinese counterpart based on their nationality and language skills alone. Today, to get a higher salary, you need specialized skills and a strong background. If candidates aren’t sure what the market rate is, they can ask the employer what salary they are offering for the position (the employer will have one in mind) and negotiate accordingly based on background, experience, and benefits.

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If I should give an advice about negotiating to someone who is searching for a job in China I would say to be strategic, do your research and prepare in advance. Make sure you understand what cards you have and lay them down one by one rather than showing your hand all at once. While every situation is different, you generally cannot expect too much transparency. If possible, you should attempt to frame the solution as a win-win and avoid causing the other party to lose face when they agree to your terms.

Don’t be afraid of China. It is a country with a lot of opportunities and is growng rapidly, so it needs a lot of qualified workforce. Maybe if you want to try a new culture and get well paid, it should be your turn to travel to this amazing country.


NEGOTIATION AND PARTNERSHIP WITH CHINESE PEOPLE

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There are three elements to highlight that affect business culture: the first is the socio-cultural policies and the People’s Republic of China, the second the influence of Confucianism and Taoism and the third the existence and use by the Chinese negotiators of two works traditional: the Art of War and Secret Art of War: 36 stratagems.

Over the past two thousand years, Confucianism and Taoism have shaped the design of China’s political, educational, and economic systems, and influenced the behavioral and thinking patterns of the Chinese people.

The western business practices admitted through China’s open door have change the way into a smoother communication during business negotiations, despite sometimes constrained by conflicting concepts or values.

This are the three main ideas of negotiation in China:

a) Focus on Relationships

The central theme of Confucianism is relationships, in particular, interpersonal relationships. In the eyes of the Chinese people, any relationship between businesses is ultimately built up to relationships between individuals.

Westerners tend to view interpersonal relationships not as a prerequisite to business relationships. In the West, relationships often grow out of business deals, whereas in China business deals usually grow out of relationships.

b) Respect for Hierarchy

Hierarchy, interdependence, and reciprocity are the key features of Confucianism’s five interpersonal relationships: between ruler and ruled, husband and wife, parents and children, older and younger brothers, and friend and friend. Except for the last, all the relationships were strictly hierarchical.

Failure to honor these characteristics can endanger interpersonal relationships as well as mutual trust among negotiating parties. Hierarchy is reflected in the way Chinese people address and greet each other, how decisions are made, and who speaks during meetings.

c) Trust and Ethics

Western cultures often perceive their ethical norms to be universally applicable, and consequently categorically view deception as evil. But in neo-Taoist societies such as China, Japan and Korea, in which ethical duties are viewed as contextual, the motives for it and existing relationships can sometimes render deception virtuous.

From a Chinese perspective, negotiation exists primarily as a mechanism for building trust so that two parties can work together for the benefit of both. Trust is built through dialogue that lets each party judge or evaluate the partner and the partner’s capabilities and assess each other’s relative status.

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Given the greatness of its territory, ethnic diversity, and fast pace of change, China’s business culture is not at all times and in all places the same. Chinese business culture should instead be seen as a meld of modern western ideas and traditional Chinese values.

 

Alba Traver Gual


Marketing in China

The question of how to market and sell to companies based in China is one that is debated endlessly by foreign companies seeking to profit from the huge potential of the country.

Chinese companies have developed so fast over the past years creating modern companies with sophisticated business systems that makes it hard for Western companies. Although ongoing East-West cultural differences continue to pose challenges to foreign enterprises carrying out marketing in China, companies that make an effort to understand such variations and integrate them into their marketing strategies stand a greater chance of succeeding in the China market.

We’ll discuss four main topics:

Market Segmentation

China’s regional differences in economic development and consumer purchasing power have a significant impact on enterprises strategies and must be studied before a new product is launched on the market. There are different types of segmentation:

Geographic Segmentation: the first problem in China is the language, there are many dialects and Mandarin is a 2nd language for most Chinese. The second problem is the differentiation by Urban, Rural and City Tiers.

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Generational Segmentation: The older generation in China experienced the Cultural Revolution and all the joys of Maoism. They’re experience and values are completely different from those who were too young to remember anything of the Cultural Revolution. The 70’s generation prefer to work in offices in monotonous jobs while the 80’s generation are not happy with this kind of jobs and the 90’s generation is very creative and smart.

Consumers

With a population that exceeds 1.3 billion people and a land mass larger than the United States, China’s sheer size and scale presents challenges uniquely distinct from any other market (including other Asian markets such as Japan and South Korea).  While it is true that China represents a huge potential market for foreign manufactured goods and services, it is also the case that understanding where these opportunities lie and how to access them can be extremely challenging. The first realization that foreign companies often need to make is that China is in no way a uniform and homogenous market.  Although China is unified in the geo-political sense, socially and economically the picture is much more disparate and fragmented.

Opportunities

In china there is a special guide for investment, the Catalogue of Industries for Foreign Direct Investment. Generally speaking, foreign industries in China can be sorted into four categories: the “encouraged”, the “restricted”, the ”prohibited” and by implication the so-called “permitted” (Industries that are not included in the catalogue).

The prohibited catalogue include several sectors that are prohibited in china but there are big opportunities in this sectors because China is now improving his international relations and with every new catalog there are more prohibited sectors that become in permitted or restricted sectors. Restricted sectors means that if a foreign company want to invest in China they need to create a joining venture that is an alliance with a Chinese company.

Branding in China  

Foreign companies needs no spend the time and evaluate the positives and negatives consequences of different branding possibilities. Be sure the person involved is from mainland China so that they can identify any nuances that other Chinese speakers would not pick up. It depends too of the sector. In many industries where brands are not well known, domestic branding is less important. What is important is the high quality and prestige. A typical strategy is to have a Chinese name as Pepsi.

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My trip to China.

It’s hard to describe a single ‘best experience” in an entire trip; for me it was the combination of several things in different degrees, it was the food, the city, the places to see and the things to do. For example, I really liked the contrast in both Shangai and Pekin, but most of it in Shangai. The difference between two lifestyles was very interesting, in the same city maybe 2 o 3 subway stations apart, the buildings were taller, the cars were nicer, the brands and shops were more luxurious, and basically it was a completely different sight at a very short distance. This aspect of the visit is even more remarkable when you throw into account the old places right in the middle of the city. I had the opportunity to visit the Yu Garden, which is a 5 acre and almost 500 years old complex. It was really shocking, in a good way, to see this ancient structure surrounded by modern day buildings and streets , but it was even more shocking to see, inside the complex a Starbucks along with several tea shops and tourists (like myself)  built in harmony with the rest of hundred year old structures.

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This aspect of the city was present again and again, whether by traveling on the highway and suddenly seeing the characteristic roof of a temple, or by walking down the street and seeing an old monument or structure right beside a mall. The weekend in Bejing was, however, a different story. This is the city where i think I saw the most of China, mainly because of when you think China, you think the Great Wall and the Forbidden City. It was in these places that the contrast I mentioned earlier was multiplied by 100. Upon entering the Forbidden City you might as well forget you are in a place that hosted the Olympics just eight years ago. It’s just wall after wall surrounded by history that completely transport you to the times when this now tourist place, was used to pray for a good harvest or where people would meet to see the emperor.

 

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Of course no telling of a visit to China would be complete without mentioning one of UNESCO’s world heritage sites, one of the seven world wonders and one of the most astonishing milestones in civil engineering and human performance, of course, i’m talking about the Great Wall of China. Visiting this place was definitely one of the highlights of the whole trip. Standing in a structure that’s been there for hundreds of years before I was born, and will most likely still stand long after I’m gone is a very humbling experience, and at the same time, it fills me with joy and pride being able to say i was there. For me, despite the fact that there were more visits to interesting places and experiences, the visit to the Great Wall was the perfect ending to an unforgettable trip.

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Studytrip: My Favourite Visit

If I have to talk about the most interesting visit in China, there is no doubt that it was the week end in Beijing. Beijing is the capital of China, and one of the cities with more inhabitants in the world (21,150,000). We arrived there on Friday night and thanks to Antonio that we had hamburgers waiting for us at the hotel. After that, we went out to know the Beijing night and we were surprised that occidental people usually have free drinks at the night clubs.

On Saturday morning they took us to the Forbidden City, which was the imperial palace from the Ming Dynasty to the end of the Qing Dynasty (1420-1912). It is located at the centre of Beijing, and now houses the Palace Museum. It used to serve as the house of emperors and their households, as well as the political centre of Chinese Government. It was built from 1406 to 1420, consist of 980 buildings and covers 720,000 m2. After this we went to eat the famous Beijing duck, a traditional plate from Beijing, which in my opinion was so good if I compare it with the rest of the Chinese food.  Then we went to the Temple of Heaven, a medieval complex of religious buildings situated in the southeastern part of Beijing. The complex was visited by the Emperors of the Ming and Qing Dynasties for annual ceremonies of prayer to Heaven for good harvest.

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But the best visit was reserved for Sunday. We went to the Great Wall in the morning, where we spent two hours walking around and enjoying the amazing views form the Wall. It consists of a serie of fortifications made of stone, built from east to west across the northern borders of China to protect the Chinese states and empires against the invasions of the nomadic groups of the Eurasian Steppe, and measures more than 6,000 km. After this, it was time to finish this nice experience and go back to Shanghai.

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The Chinese negotiation

China is home to 20 per cent of the world’s population and the world’s fastest growing economy. It is a country that is constantly growing and for that is why many foreign companies are interested in settling there to start a business or to open new horizons.

But, how can businesses establish in China? How to negotiate with Chinese people?

Negotiate and agree with Chinese partners is a constant challenge. It’s not only the language but also the culture. You cannot get to do business in China or associate with them without knowing their culture deeply before it. It is not only based on a business relationship, business in China is a conducted between friends, so, you have to make an effort to get to know them on a more personal level. Chinese people do not want to ‘lose face’, and they also do not want to cause you to ‘lose face’. Here there is not a ‘winner’ or a ‘loser’.

Another thing is that they will rarely disagree with you in public, and will instead emphasize friendly relations and cooperation.


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Doing business in China is a ‘marathon’, not a ‘sprint’: Negotiations are likely to take place over a longer period of time. You do not negotiate by telephone, is a face to face meeting.

The key of any Chinese negotiation tactic is to understand what you want and understand in detail what you are prepared to give them for this. You have to know your bottom line and be patient and practice the “cold shower” approach to decision making.

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And the most important is to assemble a capable Chinese team and enlist the support of third parties, most importantly the government, which often could be difficult to deal with it, because of its industrial policy and its regulations.

 


HUMAN RESOURCES MANAGEMENT, LABOUR MARKET AND EXPATRIATION IN CHINA

When a foreigner is going to work to China, the main difficulty encountered is culture. In the chinese culture the family is very important, As usual than the family likes the job is more important than the salary. While a Western always has greater interest in the project that he will work, for a chinese is more important the reputation and image that can have on others.

Regarding to the labor market, one of the things on which all think when hear about China is low salaries. In one of our visits we talked about it. In China each region can set the minimum wage for workers. So companies are looking for places that can favor them. During the visit we were told that salaries were low, but since years the wages are increasing.

Another of the things that we discussed was the Hukou law, that law was created in 1958, It league citizens to where they were born, limiting the use of public services if they move to other areas. Internal migrants do not have access to protected housing and other subsidies; their children don’t have, most of the time, public schools and have more issues to study in the university. These reasons limit severely the development of the habitants of the most underdeveloped areas, because when they want to move to have better jobs they are in disadvantage. If we add this law to previously information said about salaries, for a person who wants to move to a big city, it is very difficult to keep up with a single salary, it has to take on more expenses than a local citizen. But as with the salary, each region applies the hukou law in their own way, so that if a foreigner wants to move to China, in my opinion, he should start living in a city where has the best combination of salary and hukou law, and when he knows the culture, he should move to one of the most important cities in China, to grow up in the labor market.

In conclusion, China is a very interesting country where you will be able to develop your working life because it is developing very quickly, and which are taking very significant technological advances country.


Discovering China

If I have to choose the visit that I enjoyed the most in China, It would be our two days trip to Beijing, and here is why.

The main reason it’s because in Beijing are the most famous places of China, that is to say: The forbidden city, the  temple of Heaven, The Olympic Mille and the Great Wall. Lets focus on the last one which is one of the seven wonders of the modern world and it impressed me a lot, more than anything I have seen in my life so far.

As a civil engineer, I spent last 6 years of my life studying this topic, I mean this kind of projects, the biggest ones like highways, Dams, Bridges Tunnels etc. Although I can not even imagine how many years of planification it took. For example from where they brought this huge amount of Stone ore ven how many human lifes it cost, It’s terryfing.

However, as i said, I am an enfgineer so that I would have loved to have played an important role in this wonderful Project that is going to be admired and remembered forever. Its the longer structure all over the world, more dan 6500 kilometers, it is said that you can see it from the space  although it actually depends on from where in the space you are looking and if you are watching it using a telescope or not.

At last but not least I would like to talk about the pollution, not only in beijing but also in the rest of China. Back in Spain I used to think that people could be overreacting when they´d talked to me about the pollution in China. However as son as we landed it dawn on us that they weren’t overreacting at all. In fact the mayority of us we have come back to Spain with a terrible throat ache.

To sum up I would like to encourage you to visit China If you haven’t done. It’s such an amazing country, very different from Europe or America and where  I  have learnt a lot.

 

Adriano Quesada Llinares


MARKETING IN CHINA

How to reach Chinese consumers? That is the question that a lot of companies have been doing over the lasts years. The substantial increase in China’s economy and the growth of a middle class, increasingly more purchasing power has supposed the economic awakening of this sleeping giant, and the new opening to the outside of government have produced this market is increasingly demanded , having more than one billion potential customers.

Note that the Chinese population is very segmented, as the realities within the country are very different depending on the area and according to the city, the likes of the population are very heterogeneous, It means, It is not the same capture a client of a city like Hong Kong or Shanghai, that someone from western China, where the population is predominantly rural, and where poverty is much higher.

We must also differentiate according ages, the market is very varied, this is mainly due to the difference between the generations who lived through the Cultural Revolution and later who do not remember any of this. All this together makes the Chinese market is highly differentiated, so to make a name in it You should focus on a very specific target and not go for something general, which is synonymous of failure.

In China domestic brands are not favour by the government , which is a plus for a foreign country´s brand. To commercialize have to find a Chinese partner and a Chinese name, with its own brand characteristics, and ascribing a set of values ​​that have a correlation with the population you want to bring. The new generations tend to look for luxury products and foreign well-known brands, so you have to sell an important position in your country is something special importance.

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The market for this sleeping giant has a spectacular future, although it introduced with possibilities of success is very complicated and it will require attention to social networks like wechat, the most popular in China which will help greatly with the introduction of our product in this great country.

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A country in which the growth of our brand can become exponential, and it will contact with a lot of potential customers. Undoubtedly marketing in China is really complicated, but if done in the right way, profits can be impressive.

Miguel Vallejo Fernández

 


MARKETING IN CHINA

During my stay in China, I notice how difficult was to start doing business there and I was surprised when I heard about all the laws and steps that you need to know and follow if you want to be integrated in this incredible country.

If you want to do marketing in China, Shanghai is the right place. In this city, the marketing professionals can discover how the old and modern lines of marketing finally match following the same way.

China shows that in marketing nothing is written and this is why I share three key points to consider when we are talking about marketing:

  1. China is different

It’s obvious that the platforms that dominate in China are markedly different to ones that marketers are familiar with elsewhere. The ways that Chinese citizens use social channels is also markedly different, and marketers need to carefully adapt their approaches for China’s cultural and societal idiosyncrasies as much as for its technological differences.

  1. A personal approach makes a difference

             In particular, the growing popularity of chat apps in China presents a new set of opportunities for marketers.

Marketers will need to explore new approaches to social media and content marketing, ensuring that the tactics they employ make it easy for audiences to find and consume content on one platform, and then share that content via chat apps. This will require greater emphasis on highly engaging content and organic sharing, rather than an approach that relies on paid media to push mediocre content to the masses.

  1. Social selling

Marketers must start to explore how the dynamics of social referral work in China for their specific audiences and industry, and use that to move from social engagement to social conversion.

 

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