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Chinese business essentials: Get good guanxi

By Josian Phillips, 

It’s well documented: China is big for business, undisputedly the world’s fastest growing economy. But your road to success depends on good guanxi.

Get good guanxi

Guanxi (gwan-shee). Guanxi. Remember it. If you have good guanxi your pathway to business success in China may well be paved with gold. It is the key to success, and really could land you that fantastic distribution deal. However, with bad guanxi, you may find yourself stuck in the mud and struggling to make an impression.

The guanxi ethos is simple. Loosely it means connecting and building relationships, networking you could say, but it’s taken more seriously and runs more personally in China. It is the backbone of Chinese business success because traditionally the Chinese tend to feel more comfortable doing business with people they know. They like to have common interests and mutually beneficial relationships. Caringly cultivate your Chinese business connections, nurture them and take care to abide by some of their essential business traditions. You would do well, for example, to gen up on Confucianism. The philosophy runs deep. The Chinese are non-confrontational and respectful of their peers, it would be seriously beneficial to your business if you understood and respected these cultural differences, and would help you on your way to obtaining the accolade of possessing good guanxi.

The all important business trips

Be delicate and do not go charging into China. It takes time to enter the Chinese market, often requiring many business-building trips. Those first few meetings should not make any mention of business, just purely be about bonding with your contacts. The Chinese do have a good sense of humour, but humour too is best avoided in these initial meetings.

Essential business meeting tips:

  1. Dress very well, tailored and smart but conservative. Ladies, aim not to tower above men in high heels.
  2. Prepare to bargain, so add some leeway.
  3. Consider taking on an intermediary to set up meetings and help with bureaucracy. UKTI would be a good starting point.
  4. Receive and give business cards with both hands, and take time to study them respectfully taking in the detail, and numbers.

Further reading

Explaining Guanxi: The Chinese Business Network

Guanxi: Microsoft, China and Bill Gates’ Plan To Win The Road Ahead

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