Before one visits China or starts doing business in China, it’s always a good idea to learn about the culture, tradition, and history of the country. For instance, when a foreigner tries to speak Chinese, they will appreciate the effort made and the initiative taken. Ability to understand the language will help to establish a better ‘Guanxi’ with Chinese businesspeople. ‘Guanxi’ meaning ‘relationship’ is an extremely important Chinese business element. By getting the right Guanxi, the organization reduces the risks and the barriers involved in setting up the business. For this reason, Guanxi is a good business strategy that everyone follows in China in order to be successful. This is an ongoing process and every company has to have a good Guanxi if it wants to do more business in China.

Chinese follow Confucianism which is a system of behavior, ethics that stresses the obligations of people towards another based on the relationship. Confucianism emphases on sincerity, duty, loyalty, respect for age and honor. Another concept that the Chinese follow is ‘Xinyong’ which means personal trust, this is a concept of pivotal significance for doing business in China. Instead of focusing on the business deal, the Chinese attempt to develop a Xinyong. This is definitely a time-consuming process but the Chinese business community operates on the basis of limited and bounded trust. Chinese businesses are mostly through referrals and essentially a business relationship is struck based on another business associate’s recommendation. The Chinese are very particular about the companies that they work with and hence the role of an intermediary is very important to vouch for the reliability of the company or an individual. Foreign business people to conduct business in China, requires great patience and determination. The lengthy exchange of pleasantries, draw out negotiation where minor points are discussed and reluctance to close the deals are some of the business traditions that can be frustrating.&nbsp.

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