When conduct business in China, having a right middleman could be very helpful. If, in a business deal your counterpart does not follow the contract, you don't sue. Once you sue, the relationship between you is over. And more, it is too hard and expensive to obtain justice. What you should do is to find some middleman someone who owes you a favor and whom your counterpart owes a favor to — and then ask him to judge and balance the situation. Or, you may find someone who has some kind of authority for whatever reasons: position, knowledge, fame, wealth or age to act as amiddleman. Chinese people will give face to authorities in general.
It is interesting to point out that, in the US when people are in trouble, most often they contact their lawyers first: in China, people often think about what kind of Guanxi/connection they can access to get them out of the trouble. This is certainly bad news for lawyers. Another loser in this kind of business environment is the government. You can sec that the middleman is providing valuable services for businesses and individuals. Traditionally, you don't pay them money for what they did for you, rather you owe them a favor you will pay back in some way in the future. Obviously, government can only collect taxes on money transactions, not on favors.
Nonetheless, legal and other professional services have been emerging rather rapidly in China in the last few years. However, the professional service industry is still in its infancy. Some of these firms are just selling Guanxi/connections instead of professional services. Sooner or later, with the political and economic changes taking place in China, this will become history. But for now, it is critical to obtain a reliable referral from people you can trust before retaining professional services in China.
Establishing a Guanxi/Connection
Giving presents is a very popular and modest way to start a relationship. It looks like a simple idea, but it actually takes a lot of leaning to master the skills on what, when, how to give to whom. A friend of mine, a Chinese-American doing business between the US and China,has established a personal-computer database for business gift giving and receiving. He seeks to ensure that no repeat gifts are given to the some person, the value of the gifts is proper for every occasion and all thepresents received have been repaid properly in one way or another.
Let's consider the value of a present, to examine the subtlety of this issue. You should not give inexpensive gifts to someone who you don't know well, because the person may not feel respected enough. You shouldn't give too expensive gifts either, because he or she might suspect that you may ask for a favor that he or she can not deliver. In different parts of China, the proper value of gifts for various occasions might be different, and you should check that out before you make a decision.
Normally, Chinese will not receive gifts from strangers, and an introduction from a proper person is recommended for a first meeting. Chinese believe that people will not give a gift without a reason. Establishing friendship or Guanxi is a legitimate reason.
Some people go too far in this direction and use this reason to lubricate business deals. Indeed, when doing business with Chinese, you often encounter some who claim importance and ask for bribes. You should delicately try keep away from these kinds of people. Bribery is not only illegal in China, it also often leads you into traps. These people may seem to speed up your business, but probably lack the influence to help you go all the way. At the same time, those people may be able to slow you down, but they can never stop a viable business.
When doing business In China, you should pay attention not only to the details of the contact but also to the people across the negotiating table - their personal interests, emotions and aspirations. You certainly want to build a friendly relationship or Guanxi with people who will implement and execute the contract. As part of the culture, Chinese are very flexible to friends, strict to strangers and cold to enemies. If they consider you a friend, they are willing to do extra things for you, even though they aren't part of the contract. Otherwise a contract might very well only serve as a guideline for arguments.
In China, just like the rest of the world, you can not buy a true and lasting relationship. What you should do is to earn it the hard way through your sincere commitment and unremitting attention. |
