Chinese business contacts are mostly referrals; essentially a business relationship is struck based on another business associate recommendation. The best prices and deals often comes from a strong recommendation. However, it is common today for cold calls and direct contacts, given the availability of the internet and the competitive nature of Chinese businesses. You may source from the internet, trade fairs, catalogues and brochures, advertisements and approach the Chinese companies directly through a call or email.

Chinese business relationship inevitably becomes a social relationship after a while. Unlike Western business relationship which remains professional and perhaps, aloof, even after a long time, Chinese business relationship becomes a social one. The more you share your personal life, including family, hobbies, political views, aspirations, the closer you are in your business relationship. Sometimes, a lot of time is spent discussing matters outside of business, but then a lot of time, the other party is also making up his mind about your deal based on how much he sees your personal relationship with him.

Seniority is very important to the Chinese especially if you are dealing with a State owned or government body. Instead of addressing the other party as Mr or Mrs so and so, it is always appropriate to address the other party by his designation ie Chairman So and So, Director So and So or Manager So and So.When giving out namecards or brochures, make sure you start with the most senior person before moving down the line. When giving out a namecard or recieving one, ensure that you are stretching out with both hands with the card. Remember to face the card you are giving out in a manner such that the recieving party gets it facing him correctly.

Giving face (aka giving due respect) is a very important concept in China. You must give the appropriate respect according to rank and seniority. For example, if you are buying gifts for an initial contact, make sure you buy better gifts for the senior managers instead of buying similar gifts across the board. Similarly, sitting positions in a meeting room or a dining table is accorded accordingly to rank, importance and seniority. It is good to seek advice before embarking on your first meeting with Chinese business contacts to avoid making the wrong move.

Unlike earlier days when China was very poor, gifts, especially of Western origin was especially appreciated. Today, China produces and imports almost anything imaginable and gifts are no longer a novelty. However, gifts are always appreciated and especially in the smaller cities or towns, will continue to play an important part in your business relationship. Do note that if you are indeed giving gifts, make sure the senior people get a better gift or at least gifts perceived to have a higher value than their junior staff. Similarly, expect to recieve gifts from the Chinese, especially Chinese art products. It is polite not to refuse, especially if it is not of too high a monetary value.

There is no business talk in China without at least one trip to a restaurant. Sometimes, a trip is made to the restaurant even before any business discussion take place! Inevitably, the restaurant will always be a grand one and you are likely to be hosted in a private room. There is an elaborate seating arrangement for a Chinese business meal. There are fixed seating positions for the host and the guest and then they are seated again according to seniority. This is a very important aspect of a formal dinner and it is important that you follow the rules accordingly. However, it seems that the Northern Chinese are very particular to this formal seating arrangement while the Southern Chinese has loosen the formalities somewhat.

The Chinese are big drinkers especially in Northern and Western China. It does not matter if it is lunch or dinner; as long as a meal is being hosted, there will be alcohol. Chinese wine is the favourite, followed by red wine and beer. Chinese wine is more like fuel than liquor, having a alcohol concentration as high as 60%! No matter how good a drinker you may think of yourself, never, ever challenge a Chinese into a drinking contest. They will win, hands down! It is often seen as rude not to drink with the Chinese in a formal dinner. To maintain your sanity, either claim to be a non alcoholic or plead medical grounds as an excuse. This will let you off the hook with little or minimal drinks. Better yet, bring a partner who can drink on your behalf!

Formal business dinner normally drags for quite sometime as there will be much social talk, some karoake, and drinking contests. Most of the time, everyone is too drunk to indulge in further entertainment after a dinner. In addition, if you are just new to this partnership, you are unlikely to be invited to further after dinner entertainment. However, once you are familiar with them, you may be invited to a Karaoke, or a Night Club, or a Suana. Do note that if they are the host for the night, all bills will be picked up by them for the night, including all entertainment. It is impolite to fight for the bill or worst, split the bills.

There are some taboo areas in social conversations with the Chinese. Try to avoid these conversational topics as much as possible. I have seen many nasty arguements as a result of these topics: 1. You must not mention that Taiwan is an independent state or a country. 2. You must NEVER praise the Japanese or be seen to be good buddies with them 3. You can condemn Mao Tse Tung but avoid critising Deng Hsiao Ping 4. You must not praise Shanghai in front of natives of Beijing and similarly vice versa