Selling to the PRC

1
Selling to the PRC

• Richard E. Plank
• Russ Berrie Institute for Professional Selling

2
Two Major Pitfalls in Doing Business in the PRC

• You dont understand the nature of government
  activity and its impact on your business
  prospects
• You dont understand the culture of the country

3
Governmental Issues Positive

• On the plus side now a member of WTO
• Rapidly growing consumer and B2B demand
• Foreign trade law amended
• Product/quality certifications moving along

4
The Negative Side

• Government legislation still vague lots of
  change, usually very suddenly
• Intellectual property rights better, but still
  not to Western standards and laws are different
  then ours Still lots of piracy and outright
  fraud
• Lots of hidden assets and shaky accounting
  standards to deal with

5
The Selling Process

• Slow and built on Trust!!!
• Very personal, people and your relationship with
  them matters very much
• Business networks on built on family ties
• Socializing absolutely necessary, just not the
  golf course although this may change
• Preparation a key, do your homework
• Be flexible with time commitments

6
Chinese Culture Core Social Values

• Guanxi (developing, cultivating, and maintaining
  connections)
• Mianzi (face or avoiding speech or actions that
  cause embarrassment to others)
• Renqing (favor that involves obligation to
  reciprocate)

7
Common Culture Different Styles

• People are always more alike then Different
• However China like most other places has
  significant subcultures within the main culture
  that impact on how you do business in the area

8
Beijing

• Political Zeal
• Family Status and Social Position
• Especially sensitive to face

9
Shanghai

• More westernized
• Strong rule of law
• Ignore politics, more practical and economically
  driven
• Low negotiations over even minor issues

10
Catonese (Guangdong)

• More welcoming to foreigners
• Risk takers
• Apt to take advantage of you
• Lots of counterfeiting etc

11
Northeasterners

• Big and quick deals no much on details
• More sensitive to face therefore more investment
  in emotions
• More likely to swindle you (at least one authors
  thinking)

12
Sichuanese

• Big area for science and techology
• Generally very honest and sincere
• Strong Confucian influence
• Harmony, moderation, little vanity

13
Zhejiangese

• Known for business acumen
• Sales oriented, persuasive
• Sophisticated social skills