For any business, planning the first site visit to China seems daunting, but there are a few how-to’s which make it easier, writes Trink Group MD Colin Smith.
Given the increasing presence of Chinese companies in South Africa, for local businesses the question of dealing with mainland China is not ”should we,” but “how soon can we.”
As with all business transactions, knowing how to deal a potential supplier abroad, setting up a long- standing relationship and understanding the fragile cultural nuances are all key to making a success of your business’s venture. It is daunting for local businesses who want to deal with the world’s largest economy, but the following key tips will help with any pending business venture:
You will likely only receive a single entry visa on your first visit to China. Because border control between Hong Kong and mainland China remains strict, do not make the mistake of setting up base in Hong Kong, as your single-entry visa will prohibit crisscrossing between the mainland and Hong Kong more than once.
Most people will first arrive in Hong Kong. Because the city is so different to what we are used to, it is a good idea to set up base in a hotel for a couple of nights to adjust to the culture and clear your mind. Just remember: you are on business and not a holiday.
Before you leave, have the contact details of the South African Embassy with you – in English and Chinese.
There is a vast culture difference between Hong Kong and the mainland, so don’t rely on a smartphone app to help you with translations. Rather let the Chinese company you are visiting book your accommodation near to their offices, and arrange for transport to and from your hotel. Trying to navigate this on your own is a feat which is sure to drain you of all your business acumen.
Never leave your hotel without the establishment’s business card. On the hotel cards are descriptions (in the local vernacular) of the location of the hotel, so if you catch a cab, just show them the card (and also make sure they start the meter).
While most Chinese suppliers only deal in US dollars, ensure you have a couple hundred Chinese Yuan in cash to cover any additional expenses such as taxis and so-on.
Because of the cost of international roaming, make use of your hotel’s wireless internet. Also note that some social networks such as Facebook are banned in China, although you should be able to Skype your loved ones from the hotel.
Do not scrimp and save on business cards – your Chinese hosts will judge you on this. Business cards are exchanged formally at first introductions. When they inspect it closely, do not say a word. When they present theirs, take it with both hands and do not look up at them until you have inspected it. Then place it carefully in your shirt pocket. Business cards are a very personal item among China businesses.
After exchanging cards, you will either start a factory tour, or have lunch. Be careful not to decline offers of tea or lunch, as it is a symbolic gesture of goodwill. Sugar or milk will most likely not be on hand for tea, so just grin and bear it. It is also customary for your hosts to refill your cup when you are done – to try and stop them is considered an insult. Also be sure to only drink bottled water, and be sure to pack antidiuretics.
Mind your manners
The Chinese love doing business around the dining table. Although your hosts will never let you pay for a meal, offering to do so shows great respect. Remember to take an African curio gift for your host. While the Chinese generally do not prefer alcohol, a bottle of Amarula is often welcomed.
If you have a complaint or concern regarding business, never do this at the beginning of a meal, but rather towards the end – your hosts will appreciate your patience. Also be aware that your seat will be assigned to you by your hosts, so do not sit down randomly.
Because of the language barrier, the company will usually make use of an interpreter. Often the company owner or MD will not be present at your initial meetings. Do not feel neglected – it is customary to first liaise with the appointed sales manager. Only much later in your import career (sometimes years later) will you be invited to dine with the company owner.
When you eventually do make an actual payment to your Chinese supplier, only pay funds to a Chinese mainland or Hong Kong bank and never to any other country. The same goes to using PayPal. Paying funds for a container load of imports into a Belgian account many years ago cost us dearly and strained our relationship with our Chinese partners. We never saw our money again. The Chinese can only help with fraud if the money was paid into a Chinese mainland bank. If you ever have issues with payment, you can contact the Chinese Consulate in Pretoria – they are very helpful when it comes to trade relations with South Africa.