Using Negotiation Skills During The 5 Stage Process To Achieving Successful Deals In China

1. Negotiation goal

For many the aim of negotiation is a substantive outcome and material gain. In China the transaction is all about the relationship and there is no better method to succeed in doing trade than through a close partnership, so consider investing a lot of time in this pre-negotiation phase.

The aim of negotiation is not the signed contract and unforeseen events are resolved through the partnership; the contract is more a sign of the meaning to do business together than a legally binding document. Trust is the foundation of the contract and the fact that you have signed a contract does not actually mean that the transaction is sealed; it means that an alliance has been recognised.

2. Negotiation attitude and communication style

The Chinese negotiation approach is one of collaboration and problem solving whilst still focused on profit.

The communication approach is expressed by using titles, following procedure and being highly respectful and alert in conversation. Always start with a formal approach, using first names and an informal style is risky and can be considered offensive and viewed as an insult.

When you negotiate, listen carefully to ascertain the exact meaning. It is unusual to be told a direct no and you will more likely be told "it is difficult" which in fact does mean that you have no chance of success. Do not expect to receive direct clear responses, because you will try to fix something that "is difficult" when in fact it can't be resolved.

3. Time perception

A lot of time is spent in developing a relationship which is a sign of respect and which is expected to be reciprocated. For Westerners time is sacred and the Chinese usually take advantage of this fact. Preparation is therefore important, create alternatives and let the otherside know that they are is not the only one who can walk away from the transaction. Do not forget that "tomorrow" or "next week" often doesn't literally imply the following day or week; instead this could mean "in the future".

4. Negotiation style

What for most Westerners may appear to be innocent socialising is in fact their way of collecting information.

Chinese negotiators are well versed in the art of positioning & framing, the complexities of pricing and the use of delays as a negotiation tactic. They have good negotiation skills and will often use negotiation tactics to embarrass or shame the other party in order to create stress and gain the upper hand. Take the blame if a problem develops whether you are responsible or not and do not react with disrespect.

Your whole team is advised to attend the meetings and it's very important to arrange for someone with a rank of authority within your business to make the introductions and to escort you during meetings. Without obvious official support, you will be delivering the wrong message about how seriously you view the negotiations.

5. Team based negotiations

The Chinese almost never negotiate unaccompanied. It is not always clear who the leader is and who has complete authority to decide matters. Although decisions are made by consensus, there is normally one leading authority who may not be very involved during negotiations. Gain the attention of their senior negotiator and direct your most persuasive and logical discussions towards him. The rest of the team normally plays the role of an advisory body.

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