4 Golden Guidelines for Trading in China
We’ve all seen the same articles 100 times about methods for trading in China. They coddle you and tell you to try harder and be persistent and eventually you will succeed. In this article I want to tell you what flaws in your (presumably European) culture or personality make it difficult to trade in China, and are holding you back from truly succeeding.
There is no such thing as perfect in China. People here don’t even like saying “完美”. I buy furniture on Taobao, they forget to include assembly instructions. The average delay on internal flights is 43 minutes. Half the rent-a-bikes on the street are broken, the other half will break in the next pot-hole.
People are used to adequate products here, don’t delay launching your product or service until it is completely perfect: launch your beta version, once in market and getting feedback you can improve and adapt. The point is that consumers here are more forgiving if something is rough around the edges.
Only in China can a company put 100,000 bikes on the street in one night, or open 10,000 retail shops across the country in a month. I can expect same day delivery if I order online from a shop in Guangdong (province the size of the UK) and I can expect 2/3 day delivery from a shop in Beijing (same distance as Manchester to St. Petersburg). China is fast paced.
In Europe, companies will often deliberate on decisions for 6 months, and add 6 months to implement. After all the deliberating and preparations, shipping time is 3 months: on day 1 you are already 3 months late! By the time your product is finally in China it is already old fashioned.
If you take your time and be patient in China, before you know it the price is different, your costs have changed, the consumers have shifted, and what works in marketing has changed. Don’t procrastinate and risk losing opportunities.
Over many years of trading in China I have assisted countless foreign businesses set-up shop or source from China. Many 40+ business people come across with a ‘colonial’ attitude, thinking that China will conform to them, that having a Western product automatically grants seniority.
China is insular, proud, diverse, solitary, and unique, you will need to conform to their way of doing things, you will need to adapt, to change your habits. You can retain your European DNA, that still gives you an edge, but you need to address your local competitors who have the same offering that you have, except they know how to talk to consumers. They already know what works in the market and what doesn’t.
People who refuse to adapt usually fail in China. If arrogant and believing they can enter market without changing their management style, or marketing, or even their whole business model, they will lose. The foreign winners in China invest a huge amount of time learning Chinese culture and nuances, learning the language, finding out what makes employees tick, learning their mindset. Without being open-minded and having a flexible approach, you will struggle to remain active in the market, let alone thrive.
Most Chinese people respect strong leaders, and they take advantage of nice people. You have no reason to make your supplier or trade partner like you, initially. The vegetable seller in the market gives me their “best price”, but only after I bought from them alone 5 or 6 times do I actually get their best price.
Mistakes are common-place in business, and you need to be firm on resolving them, and definitely do not set a precedent for being ‘nice’. I always stick with the ‘family rule’ in business scenarios here: if I am not likely to be invited to their home to meet their family for dinner, then I’ve got no reason to treat this person as a friend and give them leeway or benefit of the doubt.
Likewise, with employees, they respect strong individuals. Don’t be afraid to say “no,” “I’ll consider it,” and the like. Polite, but let them have respect for you.