If you are new to importing, one of the first things you will realize is how significantly different many cultures are compared to the U.S. Deeply rooted ideals and traditions affect the way countries conduct business, and China has many of them. One of the major keys to success in importing from China is understanding how they think, and how they build relationships. It’s important to remember that Chinese culture is steeped and rooted in thousands of years of history and tradition. American culture and history is barely a few hundred years old and has constantly been changing and developing, even within the last few decades. 

What is Guanxi?

Guanxi is a difficult word to directly translate, but it refers to the form of relationships, social or business, the Chinese build with each other. To build guanxi with a person in China takes time, trust, and opening up to successfully work. Guanxi can take months or sometimes even years to build. In America, we like our transactions and business relationships to happen quickly, concisely, and in most cases, detached from our personal lives.

Guanxi in Practice

Americans tend to be blunt with negotiations. If there is something we don’t like about a deal, we are likely to voice it. You can easily offend Chinese businessmen by being too direct. The Chinese value saving face, in fact, it is one of the most important parts of guanxi. Chinese businessmen prefer to be very polite and courteous. Knowing how to traverse the waters of negotiation cautiously yet firmly will go a long ways to impressing them. They tend to use exaggerated speech. If something is good, they will call it great. If it is ok, they will call it good. Sometimes their polite yes actually means no, depending on if someone has acted aggressively towards them. 

In many cases with negotiations in China, if you offend the person you are looking to work with, intentionally or not, they will decide not to work with you. Pushing too hard or too fast can ruin deals as well. In America, sometimes we “swallow our pride” and choose to work with people who we don’t necessarily like or care for, but if the deal is good we will accept the uncomfortable situation and move on. In order to do business with you in China, a person has to know, like and trust you. 

Sometimes, factories will prioritize clients with whom they have long standing relationships with over newer ones, and will work to make accommodations for them, such as smaller sized orders that they wouldn’t normally accept for other customers.

The Importance of Trust

Trust plays an important part for both sides of a business deal, here’s an example:

One time, a Chinese factory contacted us wanting to extend an invitation to work with us. Their website looked legitimate, as did their inquiry. We decided to visit their address hoping to see their capabilities only to discover that the location wasn’t a factory, but a run-down part of the city. The “factory” was likely someone trying to scam people out of their money.

Unfortunately, there are more than a few of these types of stories, so the importance of working with a verified supplier cannot be understated. This is why we create long term relationships and check the Chinese factories in person.

Chinese Business Banquets

Business banquets are a large part of building relationships in China. They enjoy having meals with potential partners outside of work. The conversations are personal instead of business oriented, with the goal being to get to truly know the person you are considering doing business with. The Chinese let their professional and personal lives intertwine, as they want their business partners to be friends as much as associates.

To build these relationships takes time and face to face visits. 

We are here to help bridge these differences and use our long standing relationships with suppliers in China. If you want to use a supplier that already has strong relationships with their factories, contact us.