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How to Move Forward after Negotiating in China

May 15, 2018

How to Move Forward after Negotiating in China

May 15, 2018

Negotiating in China can be a challenging task. Chinese are strategists who see business as battle. Many Chinese businessmen and –women use the teachings of Sun Tzu for negotiating. In “The Art of War”, Sun Tzu describes strategies for war.

Becoming successful with business negotiations in China can be split up in three main stages. The first stage starts at home. Preparing yourself will optimise your chance in succeeding. The second stage happens at the meeting, either in China or at home. The third stage takes place after both parties have returned home. This article will focus on stage three. The article provides important tips and tricks after returning from negotiating in China.

What is important after negotiating in China?

  1. Patience
  2. Consider local presence
  3. Evaluate & gain knowledge
  4. Plan and prepare your next negotiating in China

 

Patience

One of the main reasons organizations contact 1421 Consulting Group is the following: The organization went to China and ran into a high profiled potential partner. The potential partner seemed to be a perfect fit and seemed highly interested in the product or service. Taking their time to talk with the organization and seemingly having thought thoroughly about the potential way of collaborating. During the meetings the western organization promised to issue several documents, which they immediately follow up on after returning home. And then… silence.

Emails left un-responded, action items ignored and promises unfulfilled. The western company is confused, how does the initial interest rhyme with the sudden silence? It simply does not. However this is very normal and happens to almost all who participate in negotiations in China. It does not mean anything, either positive or negative. Just retain your patience and wait.

There are some tips and tricks on how Chinese counterparts are primed to move forward. One way to do this when negotiating in China is using WeChat to directly speak to a contact person.

 

Consider local presence

Getting to a point of collaboration with a Chinese counterpart unravels in short sprints. Every moment when parties are together, there will be many developments in the relationship. Strategies will be formed and steps forward will be taken. Each time the value of the partnership becomes clear and the potential seems extremely beneficial to both. However, each time the parties are apart, the project seems to be on a halt.

A shortcut to continue the collaboration and development of the relationship lies in setting up local presence. Being present in China will make sure contact is set up easier and the intervals will be smaller. This will have an impact on the lead-time of a project.

Setting up a complicated structure like a Wholly Foreign Owned Entity is a big step for a usually uncertain stage of building a relationship. The illusion of a presence in China is a strong possible option in order to boost negotiating in China. Selecting one of many options (like payroll services), which fits the requirements, is a challenge we love to assist our clients with.

 

Evaluate & gain knowledge

Sometimes opportunities are just not as appealing as they have been presented. Therefore evaluating the progress, the opportunity and your own role & relevance is very important. Evaluating is not easy, however it is very crucial.

Many times evaluating is impossible without extra information about the process. Figuring out whom your counterpart actually is, figuring out the value of the market or discovering the rules & regulations, are all things that provide potential crucial information to decide where you stand in the process. Consider contacting experts to help you gain such knowledge from the Chinese market.

 

Plan ahead for the next time you are negotiating in China

If being present in China makes the process move forward, then it will help to either always be in China or always have a trip planned to China. This way there is always an incentive for Chinese counterparts to actively make real on their promises. It will have a hugely positive effect on the process.

Obviously, inviting the Chinese counterparts over to your home country will have the same effect. Interacting continuously will slowly build up a rapport, which can only impact the process positively. The impact on your expenses might be significant, but succeeding in China costs a lot of energy, time and money.

Feel free to contact us with any questions about negotiating in China. We love to be sparring partners and help organizations determine the level of interest of Chinese counterparts in the Western party.

What happened in the year 1421?

From 1421 to 1423, during the Ming Dynasty of China under Emperor Zhu Di (朱棣) the fleets of Admiral Zheng He (鄭和), commanded by the Chinese captains, discovered Australia, New Zealand, the Americas, Antarctica, the Northeast Passage; and circumnavigated Greenland.

Due to this endeavour we can conclude that “1421 is the year that the Chinese discover the world”.