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Sunday, July 25, 2010

DOING BUSINESS IN CHINA: Never Assume Anything, Part 2: When “Yes” Means Something Else…

Doing Business In China with Dan Paulson

I grew up and have lived in the Midwest my entire life. Often I hear from others how nice Midwesterners are. We are polite and courteous. We respect others and it’s still possible to get a wave from a total stranger when you are out and about. Even in the US, there are cultural differences when you compare the perceptions of people from the south, either coast or the heartland.

In some cases our nice guy reputation can get us in trouble. Throughout my travels and through my work with different businesses here, I found that one of our challenges is dealing with conflict. Here in the Midwest, we often try not to hurt anyone’s feelings. In some cases we may say yes when we really don’t mean it then disappear when the person we said yes to tries to contact us. Other times we may not commit and string the person along until they are frustrated with waiting. And there are still other times where we may nod our head and smile without having a single clue to what the other person is talking about. Anyone in sales would tell you this is extremely frustrating.

While I am sure many of you have run into similar circumstances throughout the country, it is often perceived as a cultural phenomenon of the Midwest. Internationally we can face similar challenges as well.

I know a company that was looking to source materials from China. They had a project coming up that required the product to be of a specific design and needed it within a few weeks. A company in China was contacted and the management told the management from this company that the products they needed would meet specifications and be delivered by the time required. After many promises and past deadlines, the products were shipped. The cost savings for manufacturing abroad were lost through expedited shipping costs, increased labor for checking products in the US, and a damaged reputation.

In China, it can be said that yes can also mean no. As a foreigner, knowing the difference can be difficult and failing to understand can be costly. We can take it for granted that what is said will be delivered but this isn’t always so. In some cases, you might get what you ask for. I heard a story of a company that wanted to produce a product similar to a brand name competitor. They took the product to an importer and asked them to make the same item. The importer delivered on its promise and produced the same item… exactly as what was given to them… logo and all! You can imagine the impact this mistake had on that company’s business.

The key to understanding when yes means no isn’t always easy, but there are a few steps you need to take to protect yourself if you wish to do business in China.
  • Outrageous claims are a good warning: Unbelievable costs followed by incredible turn times should serve as a warning for you. If you are promised something at a marginal cost to the nearest competitor, it is an offer that is probably too good to be true. I would question the quality of the products you would receive. You might be setting yourself up for a future recall. If it’s outrageously cheap, there has to be a reason why.
  • Room for interpretation: Multiple meanings can create multiple outcomes. Make sure the meaning you wanted is the same one that is interpreted. Approach communication from that of a thesaurus. Provide analogies relative to the culture and allow your contact to “visualize” your meaning.
  • Saving face is important: Your new connection in China may want to build confidence with you. They wouldn’t want to jeopardize their relationship with you. A sign of a strong relationship is when your Chinese contact is willing to tell you no.
  • Have a Chinese contact involved: Having a good Chinese contact that has a very good English vocabulary and knows what questions to ask YOU so the information can be accurately interpreted is very important. Spending a little money and time here can save you costly mistakes down the road.

A few simple steps goes a long way to preventing big mistakes. Whether you are exporting to (or sourcing goods from) China, you need to know that what is meant is understood. It is possible to grow your business successfully in China with the right understanding, the right relationships, and the right know how. Invest wisely in your time and your money and you will find success.

For more information, please visit Dan's TNNWC Bio.

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