Fast Company

Life in China as an Entrepreneur: Face Value

“Wow, that went well!” is a reaction common among Westerners at the conclusion of any meeting held with local Chinese. Does it mean you will be nailing a $1m contract anytime soon? Unlikely.

The fact is, most meetings are great. Thinking that you are making great progress in China is an illusion shared by many foreigners here. But often, it’s a mere formality. Don’t get me wrong, a great meeting is better than a bad one. But wouldn’t a mere honest meeting be better, even if it wasn’t so positive?

Foreign entrepreneurs come to China in search of an ‘amazing’ JV partner or merely their own independent set-up. If you’re coming to China, you are here to tap into the local market and you will be dealing with local practices.

Early signs for red-flagged ‘face-value’ meetings may include any of the following: The local contact constantly on the phone, being unprepared for meetings, re-hashing old questions, the water is still warm (means they don’t understand you), and the formalities become extended as both of you are trying to build on what some call “guanxi." Which is not to say that all of this goes on without us. I’m certain that most local meetings are a lot more direct.

I’m reminded of a great old Gary Larson ‘Far Side’ comic strip with cows by the roadside. In one shot, as a car is passing, they are standing on all four legs eating grass. In the next shot, after the car has passed (foreigners), the cows get back to being themselves (Chinese), standing on two feet, socialising. Perhaps I’ve taken it too far?

Is it that the locals can’t be themselves with us? Is it that they are still getting used to seeing foreigners in their country? After all, it hasn’t been that long--what, 20 years?

Perhaps we foreigners do not have the patience to do business in China. Let’s face it, they have over 4,000 years of history. Most of the time we are all too eager to enter business and get some ‘runs on the board’. The Chinese are happy to conduct the process at a pace much more attuned to their experiences.

The term "losing face" is big in China. If I asked you what’s more important: making a mistake and owning it or making a mistake and covering it, I’m confident which answer you would choose. Things are different in China. Mistakes are a blight on someone’s reputation and must be hidden and protected at all times. Truth and foresight can be impaired if "face" is involved. It supersedes all other qualities and motives.

If you get the opportunity to promote a client's "face" (or reputation as we know it), do so. It will hold you in good stead. Understand that it is of critical importance to local Chinese. Meetings are often about face. Who is meeting whom? There is a certain prestige when a foreigner wants to meet and discuss opportunities with a local, so the element of face will always be supported by taking it.

Will they buy? Will you complete a deal? How many meetings will it take? Who knows. But make sure you understand the local ideals. Outline early the direction you want to go in and set the meetings on that path, if there is a path still available. But be careful not to pour all your time and energy into a deal that will never come to fruition. You might be slaving over someone else's face lift.

The point is, they sip tea, we slam coffee! It’s a fact. Perhaps you should switch to tea before coming here. Or at least decaf…

Andrew Collins is CEO of Mailman China, a leading alternative media company. An entrepreneur from the age of 10, Andrew has been involved responsible for various ventures, from trading marbles to establishing an M&A consulting company at the age of 25. He is living the dream in China, looking to expand his media network

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