Pedro Nicolás Santo, author of the article How to Do Business with China from Latin America and the Caribbean? presents 10 suggestions to enhance your ability to do business with China, which we share below:
1. Don't assume that what works in Latin America, the United States or Europe will also work in China: China has distinctive features that cannot be ignored. Cultural differences are not a mere label and do have effects in practice. That characteristic of your product or personal quality that fascinated your local customers, or that which helped you penetrate the European or American market, will not necessarily guarantee your success in China. Optimize your knowledge about the customs and tastes of Chinese businessmen and consumers, as well as the particularities of the different regions of the country.
2. Do not overestimate cultural differences: When it comes to intercultural negotiations, it is common to find yourself faced with complex situations. Do not predispose your mind to consider that every obstacle is due to cultural differences. Acting with common sense and professionalism is key. With rare exceptions, when doing business, the final objective of a Chinese and that of a Latin American are usually very similar. The peculiarities that may make different the path we take to achieve this objective should not be used as an excuse to camouflage the lack of seriousness. Delivering merchandise in good condition, complying with shipments on agreed dates, demonstrating knowledge about your industry, answering emails promptly or having good presentation materials for your company are aspects that Chinese and Latin Americans value equally. If you negotiate formally and keep your word, the chances of reaching a successful conclusion will be much higher.
3. Find out about the economic and social reality of China: When it comes to obtaining information about China, the language barrier is one of the most difficult to overcome. However, it is not insurmountable, far from it. There are numerous sources of information about the Asian giant in English, as well as in Spanish and Portuguese. Don't waste them. They could be very helpful when it comes to detecting your new great business opportunity. From your tablet, for example, you can subscribe to the China Daily i-paper, the English-language newspaper that is the window to China par excellence. There are also various journalistic portals about China in Spanish.
4. Stay tuned for calls made by local governments and industrial development zones: China has 22 provinces, 5 autonomous regions, 4 special municipalities and 3 special administrative regions. Likewise, throughout the country there are hundreds of industrial development zones. In the Asian giant, government structures at the provincial and municipal levels are responsible for executing plans designed by the central government. Local governments and industrial development zones often create programs to encourage economic development and innovation. Many of them are intended to attract foreign talent and know-how. For example, the Xiamen city government has launched a program to attract 100 high-level technology experts and 300 entrepreneurs within 5 to 10 years. Stay tuned for calls and check in regularly with your Chinese contacts.
5. Study existing trade agreements between China and other countries or regions: China has signed free trade agreements with various countries and blocs, such as the Association of Southeast Asian Nations (ASEAN), Chile, Peru and Costa Rica, among others. In 2003, the government of the People's Republic of China and the government of the Hong Kong Special Administrative Region signed the Closer Economic Partnership Agreement, better known as CEPA. As a result, establishing a company in Hong Kong as a gateway to Mainland China has its benefits. For example, CEPA facilitates trade in services, granting preferential access in sectors such as logistics, legal, advertising and financial services. Being aware of these agreements and knowing them in detail can be of great help when designing your strategy to penetrate the Chinese market.
6. Take advantage of the training instruments that the Chinese government makes available to individuals and organizations: Market knowledge is essential to maximize the benefits when doing business with China. Annually, the Chinese government awards thousands of scholarships to foreigners interested in learning Mandarin or pursuing undergraduate and graduate degrees in China. Take advantage of them to train yourself or to train your company's workers. In addition to the above, each year, the Chinese government organizes training seminars for public officials and entrepreneurs from developing countries, in areas such as education, environment, tourism and trade. Typically, the seminars take place in a Chinese city and are funded entirely by the Chinese government. Consult the unit of your government that administers the scholarships offered to your country for more details on how to participate in these activities.
7. Create communication campaigns especially oriented to China: Communication campaigns that are successful in your country will not necessarily be successful in China. There are many cases of international brands that failed because they believed that they should simply extrapolate marketing strategies applied elsewhere to the Asian giant. Make sure your product or service branding is conceived by someone who understands how Chinese business owners and consumers think.
8. Contact Chinese immigrants living in your country: It is estimated that more than 45 million Chinese live outside their country. Sometimes opportunities are closer than we think. There are many success stories of LAC companies that have managed to export their products to China thanks to the support provided by Chinese immigrants who are residing in their respective countries.
9. Use Chinese social networks: Most Chinese do not use social networks and instant messaging services that are more popular in the West. Learning to use applications such as QQ (instant messaging) or Wechat (a combination of messaging and social networking) will help you communicate with your Chinese counterparts more easily. Don't think that those who write to you from email addresses that don't include your company's domain are not serious. It is very common that, instead of corporate emails, companies and even government entities, the Chinese use email services such as @126.com or @163.com, which could be classified as equivalent to Gmail or Outlook.
10. Do not underestimate the importance of visiting China regularly: Visiting China regularly will significantly increase your ability to identify business opportunities in the Asian giant. Increase your participation in China-related business events. There you could find your next business partner. Complementary joint ventures are an excellent gateway to the Chinese market. Events such as the China – LAC Business Summit organized by the IDB and the Chinese Council for the Promotion of International Trade (CCPIT) are not only an excellent platform to meet Chinese business leaders, but they are also perfect excuses to travel to China, organize participation in other fairs and agendas of complementary business meetings. Do not underestimate the geographical distance and time difference.
We complete these interesting ideas with a quote from Xi Jinping, President of the People's Republic of China: "Solidarity, unity, development and lasting prosperity are dreams shared by the citizens of China and Latin America and the Caribbean. The Chinese people and the Latin American peoples have deep ties. We must pursue our dreams together and with courage achieve them.”
