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Winning Negotiating Techniques for China – Multiple partners
By andrew | April 3, 2007
Here’s a negotiating technique that will make your China-based counter-parties hate you – and your US investors and partners love you. Have multiple potential partners in China, and play one off against the other. You’re going to find yourself with lots of time on your hands, waiting for the other guy to make a decision anyway — you may as well put that time to good use by getting more players on the field. It’s easy to keep a lot more balls in the air when everything is moving in slow motion.
You should also be on the lookout for ‘meeting-mania’ when negotiating in China. A common technique is for potential partners to load the visitor up with so many meetings, visits, site tours and other “relationship-building” events that the western businessman has no time to establish other contacts. Control the pace of your meetings — and don’t allow yourself to be led around by the nose. Also, don’t hesitate to let your potential partner or supplier know that you are speaking to others. Foreign partners are still a scarce and valued commodity in China – make sure you are not being sold short.
Another tactic to be on the lookout for is the tendency for Chinese counter-parties to “run in place”. You’ll see lots and lots of activity and energy being expended – and it might give you the impression that rapid progress is being made. But then you’ll show up to what you think is the final meeting and find out you are really back at square one. If you have just one negotiation in progress, you may be going home empty-handed – or worse, with a bad deal that has loose ends and lacks adequate protection.
As for the banquets and formal dinners – thankfully they are becoming less common and less challenging for westerners. But if you do find yourself seated at ‘the big round table’, you no longer have to treat the occasion like some kind of rite of passage. If you don’t want eat sea-cucumber and sheep’s stomach, then don’t get pressured into putting on a show. Just say no. Be polite, but be firm. These are the guys you’ll be working with for years to come, and you will have to rely on their good offices, understanding and cooperation. If they are jerks to you during the courtship, you can bet the marriage will be pretty awful.
The bottom line is that the situation for westerners trying to negotiate deals in China has gotten more transparent and familiar. (On the other hand, the really great bargains and opportunities are getting scarcer and pricier.) Western investors and partners have more options then ever, and Chinese counter-parties have been climbing a very steep learning curve. If you are negotiating in major business cities, the people sitting across the table from you should be sophisticated, educated and experienced. And if you don’t like the offer or trust the partners, then terminate the relationship and move on. The range of potential partners in China has never been greater. You have plenty of options. You’re main constraint is TIME, so don’t waste it on negotiations that won’t go anywhere.
We still see many western business guys getting off the plane with business etiquette guides, trying to make their Chinese hosts comfortable. You are better off being yourself and making deals based on sound business principles and realistic financial goals.” Good advice in China – and anywhere else.
Topics: China Business, Business Entry |
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