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Chinese Business Etiquette 101 for Doing Business in China

ByChao Cheng|Chinese Culture

Feb21
Chinese Business Etiquette 101 for Doing Business in China

Chinese Business Etiquette 101 for Doing Business in China (Photo by Chao: a Chinese Banquet at a small town in Zhejiang Province)

This is the most comprehensive collection of Chinese Business Etiquettes on the planet.

What is the best part?

All of the tips in this 101 guide are from my real consulting business.

And they are 100% actionable.

I coach my clients on these tips in their strategic market entry planning and the real business development.

So if you want to do better business in China, check out this guide.

 

Chinese Business Etiquette: First Lesson to Do Business in China

Look!

With the large and prosperous market, China could be your most lucrative country to do business in.

But it is a big challenge to understand Chinese business culture.

The truth is, it is always misunderstood by the people outside China.

Successful entrepreneurs know the first lesson of doing business in China is to:

Learn Chinese Business Etiquette

In Ultimate Guide to Finding Your Profitable Niche Market in China, when you start following my 7-Step Formula  to uncover your profitable business opportunities in China,

You’re probably wondering:

How different are Chinese people doing business from western people?

In this article, I’ll reveal the cultural differences behind the common business activities in China.

They come from my real life consulting practices with my overseas clients.

If you want to share any stories, let me know!

Here we go.

 

Table of Contents

China is considered by many businessmen to be the most difficult country to break into.

Let’s start with an important concept: relationship.


01. Relationships

  • Get Connected

Chinese don’t like doing business with individuals or companies they don’t know, so working through an intermediary is crucial.

This could be an individual or an organization who can make a formal introduction and vouch for the credibility of you or your company.

Some clients tried to make appointments with key decision makers just through cold calls.

They realized this after many trials.

  • Do Business With Key Decision Makers

You have to impress and do business with decision makers at the very top.

The normal cold call strategy would not work and you will never be taken seriously.

Why?

  • First, it seems you don’t know the Chinese culture.
  • Second, they could not tell whether you are trustworthy.
  • Third, they will doubt your capability.

The wise investment is to find a local partner or agent to help you arrange serious meetings and introduce valuable connections.

  • Personal Relationship Boosts Your Chance of Success

Business relationships are built formally after the Chinese get to know you.

Doing business in China is based heavily on personal relationships, which is called Guanxi.

If you are not a friend, you are basically not a trusted business partner.

  • Prove Yourself to Win the Trust

Just knowing someone does not win your business.

You might have to meet up several times to achieve your objectives.

People can not judge a person for the first time.

  • Be Very Patient

Normally it takes a considerable amount of time.

You need time to find the right person.

You need to break through enormous bureaucracy if your client is a big company.

You Chinese clients, big or small, need time to test you to see whether you are honest and reliable.


 

02. Communication

Doing business in China is not simple at all.

Misunderstandings often happen in communications.

  • Sales Pitch in the Right Way

Send materials describing your company, its history, and your products/services, in well-translated Simplified Chinese version, or in bilingual version.

In most cases, the best way is not to translate but write a new copy for your Chinese customer.

I hate to see unprofessional sales letters full of errors.

Unfortunately, they are everywhere.

These mistakes will either waste your money and ruin your business potentials.

Let’s check a case study of an overseas medical company’s failure.

  • Face-to-Face Meetings are More Productive

The Chinese prefer face-to-face meetings rather than written or telephonic communication.

For serious business cooperations, almost no agreement could be reached without meeting in person.

You need to be present for most serious situations, even when you have a very capable managing director here in China.

  • Work Through Intermediaries to Avoid Misunderstanding

Work through a right capable China local partner, you can ask and answer questions to avoid possible misunderstandings.

Embarrassments often happen in your direct contact.

  • Keep Rank Differences in Mind

Rank is extremely important in Chinese business relationships.

Keep rank differences in mind all the time.

  • Meals and Social Events

Meals and social events are not the places for serious business discussions.

Don’t be misled by the saying of “business is done during the meals”.

  • Avoid Sensitive Political Topics

Don’t talk on topics involving national integrity and potentially painful history.

  • Don’t Judge

Don’t judge Chinese cleanliness or manners.

  • How Many Children Do You Have?

The question “How many children do you have?”  was not polite in China since most Chinese families only have one child in the past over thirty years.

It is still sensitive to many people although the policy just changed.

  • Encouraged Topics

Popular topics includes

  • education,
  • language learning (either Chinese or English),
  • and ancient Chinese history.


 

03. Business Meeting

  • Appointments in Advance

If possible, serious meetings should be made between one-to-two months in advance, preferably in writing with the meeting purpose, considering the tight schedules of both parties.

Leaving sufficient lead time is a polite way.

And it is necessary for busy men/women.

  • A Remind Call or Email

Confirm the meeting with a remind call or an Email.

It is necessary, esp. when you need to fly across half of the globe and do not want to see the door closed.

A French client made an appointment with a senior manager in a Fortune 500 company in Shanghai.

The CEO and CFO flew over and asked me to go to the client’s office together.

We were there at the front desk just on time.

However, it took three of us and the two receptionists more than half hour to find the client.

Obviously, he forgot the meeting.

And it took us another half hour to fight for an empty meeting room.

  • Arrange A Formal Introduction

If you do not have a contact within the company, use an intermediary to arrange a formal introduction.

  • Always Show Up On Time

Punctuality is a virtue in Chinese culture.

Always show up on time, or slightly early, say 5-10 minutes.

Arriving late is an insult,  If traffic delays you, always call.

  • Send An Agenda Before the Meeting

Send an agenda before the meeting so your Chinese counterpart has the time to prepare prior to the meeting.

Discuss the agenda with your translator/intermediary prior to the meeting.

  • Find Opportunities in Small Talks

Small talks are important in the meeting, and you can get much information from them.

Arrange your China partner to keep an eye on the small talks, to understand the attitude and feedback on your speech.

Teamwork always works well in business negotiations, we will cover more points in the following.

  • Bring Your Own Interpreter

It is imperative that you bring your own interpreter or Chinese speaking local partner.

Be sure he/she understands the major concepts prior to the meeting.

  • Accurate Written Materials

Written materials should be available in both English and Simplified Chinese.

Be very careful about what is written.

Make sure that written translations are accurate.

  • Presentations

Presentations should be detailed, factual and focus on long-term benefits.

Visual aids are useful in large meetings.

Colors have special meanings and if you are not careful, your color choice could work against you.

Consult some expert if you want to make some good looking ones.

A safe choice is to use black type on white background.

  • Building Trust Through Accurate Data And Numbers

Customers might ask many details about your true data.

Share it if it is not classified.

Verify your data and numbers prior to the meeting.

Trust are established on these details.

Promise to give the accurate data after the meeting if you do not have.

I encourage my clients to do this and this is a very practical tip.

  • Cold Water Is Seldom Available

Cold water is seldom available in China since it’s impolite in Chinese culture.

Don’t be frightened if you can only drink hot tea, hot coffee or hot water.

Sometimes, you can get iced coke in foreign invested companies, but that is quite rare in Chinese invested companies.

  • After the Meeting

After the meeting, accompany guests beyond the door of the office, or to the elevator.

A normal practice is to accompany the high-ranking guest all the way to the car, and wait until the car has departed before leaving.

 


 

04. Business Negotiation

  • Major Speakers

Normally, only senior members of the negotiating team will speak.

Designate the most senior person in your group as your spokesman.

  • Silence

Silence isn’t an invitation for others to talk.

Silence gives one the opportunity to carefully consider what is being said and formulate an appropriate response.

  • DON’T Assume “Yes” Means Yes

Don’t be pushy.

“We will think about it”, “I will look into it” sometimes means no.

Try to figure out the reason behind the hesitance and try to find an alternative solution.

  • DON’T Say “NO” in Public

Saying a direct “No” in public is impolite in Chinese traditional culture.

Do it in private.

  • Waiting for the Decisions

Decisions are unlikely to be made during the meeting.

They may take a long time.

Careful reviews and considerations are necessary.

  • Bargain

Your starting offer should always leave room for negotiation.

  • Compromise

You must be willing to show compromise and ensure Chinese negotiators feel they have gained major concessions.

  • Contracts

Contracts are important, but do not rely too much on them.

Try to accumulate as little Chinese debt as possible.

Don’t deliver too much before getting paid, or pay too much before getting something delivered.

I always start with discovery contracts as pilot projects for most consulting cases.

Start some trial orders first to see whether it really works.


 

05. Dress Code

  • Men: Conservative

Conservative suits for men with subtle colors are the norm.

Fancy clothes like red pants, yellow suit are not accepted.

  • Women: Conservative

Women should wear conservative business suits or dresses with a high neckline.

Basically, women should avoid high heels and short sleeved blouses.

  • Colors

Subtle, neutral colors should be worn by both men and women.

 


 

06. Greeting

  • Formal Greetings

Greetings are formal and the oldest person is always greeted first.

  • Handshakes

Handshakes are the most common form of greeting with foreigners.

  • Honorific Title Rules

It’s more important to know someone’s honorific title than to know his or her name.

Feel free to drop the vice from their title when referring to them.

The common combination of address is Surname + Title.

A typical example is:

Chairman MAO

YES, You’ve got it!

If they want to move to another way of address, they will advise you which name to use.

  • English Name

Chinese who frequently deal with foreigners or travel abroad on business may adopt a Western first name, such as David Liu.

They may request that they are referred to as David, or Sally etc, once a relationship has been established.

Now I prefer using my Chinese name Chao instead of my English.

 


 

07. Get A Real Chinese Name

When you have a good Chinese name, Chinese people will think you are passionate about the Chinese market and culture.

But, make sure you get a real one.

  • Easy to Remember

Get a Real Chinese name if you want others to remember you easily.

Normally Chinese People can not remember your full name in foreign languages.

It is always more difficult if it is some long Spanish name.

  • Chinese Name Auto-generator

Do not use any online Chinese name auto-generator.

The chance to get a good Chinese name in this way is like winning a lottery.

  • Non-native Chinese Speakers

Do not ask non-native Chinese speakers to make one up for you.

  • Random People on the Internet

Do not ask a random people on the Internet to think of one for you.

  • Random Chinese Native Speaker

Do not ask a random Chinese native speaker you know to think of one for you.

  • Check and Evaluate

Do not ask a random people to check or evaluate your Chinese name.

People are doing the above quite a lot, even for their business names.

It’s such a bad idea because there are so many cultural nuances involved with finding an appropriate Chinese name.

Get A Chinese name

SinoStep: Get A REAL Chinese name, instead of a Foreign “Chinese name”

You always end up with

  • A typical “foreign name”.
  • A nonsense name.
  • A ridiculous and funny name.
  • A name that looks strange.
  • A name that sounds awful, or weird.
  • A name of a notorious villain in a classic novel, in a popular drama or movie, or in the history.
  • A name with unlucky meaning.

Many Chinese native speakers still need to consult Chinese Name expert for a good name.

 


 

08. Business Cards

  • Time to Exchange

Business cards are exchanged after the initial introduction.

  • Correct Translation

Have your business card translated into Simplified Chinese and make sure the translation is correct.

  • Include Your Title

Your business card should include your title.

People will understand your rank and arrange your counterpart for the possible appointments.

  • Indicate Your Strength

If your company is the oldest or largest in your country, include the fact on your card as well.

These are what people would like to know.

  • Sufficient Supply

A sufficient supply of business cards will be required.

You will need to give out cards to everyone you meet.

It is quite embarrassing when you are out of the business cards.

  • Use Both Hands to Present

Use both hands to present your business cards, with Chinese side facing the recipient.

  • It’s Not a Card Game

Never deal out your cards across the table like a card game.

  • Use Both Hands to Receive

Use both hands to receive business cards to show the respect too.

  • Where to Put: Pocket/Bag

Never immediately put the card in a pocket or bag.

  • Where to Put: Pants

Never put a card in your back pants pocket.

  • Examine a Business Card

Examine a business card before putting it on the table next to you or in a business card case.

  • Can I Write on the Business Card?

Never write on someone’s card unless so directed.

I’d read some tips for doing business in China to instruct one to print in gold ink since gold is an auspicious color.

This “golden” tip is obviously misleading.

I do not think it’s wise to do so nowadays.

 


 

09. Gift Giving

  • Do Not Bribe

One-sided gift-giving is awkward and sometimes improper gifts might be even considered as bribery.

It’s best to arrange through your assistant or intermediary to see whether exchanging gifts is a good idea.

One European guy flew over to Shanghai with two bottles of nice French wine in his luggage.

He planned to bring them as the present to the senior managers he will meet for the first time in a big internet company.

He told me he followed a China business guide written by a western guy.

I stopped his attempt.

The reality is, more than 10 people are sitting in the same conference room that day.

It would be embarrassing if two bottles of wine show up.

  • When is the Suitable Time?

In general, gifts are given at Chinese New Year, weddings, births, birthdays, and more recently, Christmas.

For business, it could be on some milestones of cooperation or memorial moments.

  • Better Not Made in China

A good gift idea is something with nice packaging, and more important, not made in China:)

  • Scissors

Never give scissors, knives or other cutting utensils as they indicate the severing of the relationship.

  • Clocks

Never give clocks, handkerchiefs or straw sandals as they are associated with funerals and death.

Clocks are the worst gift in China, however, watches are fine.

  • White Flowers

Do not give white flowers in business ocassions, as many Chinese associate these with funerals.

Lilies could be sent to your girlfriend.

  • Wrap the Gifts

Do not wrap gifts in white, blue or black paper.

  • Two Hands

Always present gifts with two hands.

  • Open the Gifts

In Chinese tradition, Gifts are not opened when received.

But young people can accept the western way to open the gift when they get it.

  • Acceptance vs Refusal

Gifts may be refused once, twice or even three times before they are accepted.

This is the Chinese tradition to show the humble attitude to accept any gift.


 

10. Numbers

  • 4

Four is an unlucky number because it sounds like the word “death” in mandarin Chinese.

So do not give four of anything.

  • 6

Six is considered a blessing for smoothness and progress.

  • 8

Eight is the luckiest number in Chinese culture, so giving eight of something brings luck to the recipient.

  • Chinese number gesture of 8

The thumb and index finger make an “L”, other fingers closed, with the palm facing the observer.

A client told me an embarrassing story.

Once he went to buy steamed stuffed buns.

He wanted two buns and made a sign like what I did in the picture above.

The Chinese vendor sold him eight instead of two.


 

11. Dining

  • Chinese Banquet

Entertaining guests at a Chinese banquet is a very popular and important way to establish the relationship.

  • Dining out

Dining out is more preferred than at home, especially when entertaining foreigners.

  • Good Time for Dinner

Don’t suggest meeting for dinner too late, basically Chinese eat at set hours, eg. 18:00 is normally a good time to suggest for a dinner.

  • Central Seat

The host will always take a central seat opposite the door.

  • No Cocktail Hour

There’s no cocktail hour before the dinner.

  • Business Discussion

Do not discuss specific business issues during the meal.

Some people made it worse.

  • No Sales Pitch at the Dinner Table

Do Not open the computer and make sales pitch at the dinner table.

However, It really happens.:)

An American guy put his notebook on the dinner table and made a long sales pitch when all the dishes were ready, turning cold.

This is a true story happened last summer in Quanjude, a famous Beijing duck restaurant.

All the people on the same table are quite embarrassed, not knowing whether they can eat, or not.

So I list this as a separate tip.

  • Share the Food

Dishes are almost always ordered communally and shared.

Ask for a spoon and a fork if you are not good at chopsticks.

  • After the Dinner

Normally the host will see the guests to the door, or to the car.

But there are always exceptions.


 

12. Dinner at Home

  • A Great Honor

If you are invited to their house, consider it a great honor.

And it is the opportunity to establish a personal relationship.

  • Be Punctual

Needless to repeat the importance.

  • Remove Your Shoes

Remove your shoes before entering the house.

  • Present

Bring a small gift to the hostess.

And this is the best time to give the present.

  • Eat well

Enjoy your dinner and feel what is a typical Chinese family life.

  • English Practice

Many Chinese parents want their children to speak good English.

Don’t be surprised if they ask their children to practice English with you.

 


 

13. Drinking

  • Drink Some Wine

Drinking is an important part in Chinese entertaining.

Drink some wine if you can, but not too much.

  • An Appropriate Toast

Be prepared with an appropriate toast.

Safe topics for toasts are

  • Friendship,
  • Pledges for cooperation,
  • Mutual benefit and the desire to reciprocate the hospitality.
  • Common Toast Expressions

The most common expression for toasting is Gan bei, meaning bottoms up, literally.

Another expression, Sui yi, means “as you wish” or at your own pace.

  • Do Not Pour Your Own Drink

It is the responsibility of the host to attend to the guests.

The person seated next to you may pour a drink for you.

You should reciprocate.

  • Wine Culture Difference in China

Wine culture in the Northern part of China is more formal.

If you do not drink, people would threat that they will not do business with you.

Sometimes they mean it.

The wine culture varies in different places in northern China too.

Consult your local guide for some survival guide.

I am not kidding.

In the southern part of China, you can feel more comfortable since most people will not force you to drink.

  • Red Wine With Coke

Drinking red wine is popular in bigger cities now in China, but some Chinese will mix it with Coke.

  • Baijiu

In most occasions, you’ll be offered a grain alcohol, called Baijiu, it is very strong.

Sometimes, the host will entertain a high-end distilled wine, mou-tai for most valued guests.

  • How to Avoid Drinking?

Most Chinese hosts understand if you are unable to drink alcohol.

You may use tea or a soft drink for the toast.

Stating medical reasons is always a good way to get out of drinking alcohol.

However, if you can drink, it is easier for you to build connections.

  • Do Not Sign any Deal After Drink

Leave these stuff to following days.


 

14. After-Dinner Entertainment

Like dining together, after-dinner entertainment is an excellent way to build a personal relationship.

  • Karaoke

One of the most popular entertainment is karaoke, or singing.

Practice one or two songs well and enjoy it.

  • Drink More

Again, You may need to drink more.

  • Don’t Sign Any Deal After Drink

I know, it is a repeated warning.

 


 

15. Table Manners

  • Seat Arrangements

Wait and the host will arrange the seat for you.

  • Guest of Honor

The guest of honor will sit facing the door.

  • When to Start

The host begins eating first and offers the first toast.

  • Learn to Use Chopsticks

Using chopsticks well makes you closer with your Chinese clients.

  • Try Everything

It is polite to try everything that is offered to you.

If you don’t like it, just try only a little bit.

  • Be Observant

Be observant to other peoples’ needs.

  • Do Not Put Bones in Your Bowl.

Place them on the table or in a special plate for that purpose.

  • Never Leave Chopsticks Sticking Upright Out Of Dishes

It’s the Chinese practice of leaving such dishes for the dead.

Always place on a chopsticks rest or horizontally on the side of a dish.


 

16. Tipping

  • No Tipping Culture

Tipping is not officially forbidden, but it is not common, most service staff in local hotels, restaurants, and taxis do no expect tips.

Most local restaurants forbid the employees to take tips….

No tipping does not mean you don’t like the service.

Don’t be guilty of this.

  • Tipping on Foreign Services

Tipping on services targeting foreign customers are common.

Many western restaurants and hotels in China allow their employees to accept tips.

  • Young vs Old

Younger workers prefer to accept it although older workers still consider it an insult.

  • How Much for Tips

There is no standard rules for the specific tipping amount in a country without this culture.

Sometimes leaving a few coins is sufficient.

You can be generous to give more too.

You can also follow your habit, like 10-20% of the total bill like what you do in the US or Europe.

  • Tipping in Private

If you want to acknowledge special service or assistance, do tip in private.

 

Now It’s Your Turn…

Now that you’ve seen many tips of Chinese business etiquette.

I’d like to hear from you.

What do you think of the above rules?

Or maybe you have a question about a specific situation.

Either way, leave a comment quick below.

I’ll be around to reply to comments and answer questions.

 

About the Author

Chao is recommended by Paypal to bring overseas brands into the China market. Now he coaches business owners to start up and grow their business in China. Author of Sell Online To China, How to Build A Right Website That Works In China, and a series of China Business Guides.

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