Negotiations with Chinese Suppliers and Partners: Features and Tips

Business etiquette varies significantly across countries. Conducting business negotiations in China is an art, so DiFFreight experts share important insights. Understanding cultural and business nuances, as well as company policies, will help you hold successful negotiations with suppliers, managers, or technicians.

Basic Level — Agreeing on a Purchase:

• greet politely;
• clarify what product you want to order and how much is in stock;
• specify desired delivery times and address;
• express your gratitude.

For convenience, use a translator, though the supplier might handle English as well. Remember, local messengers are widely used in China. Telegram or Viber are in a gray area. The best app to use is WeChat.

How to Negotiate with Chinese Partners

If you are meeting partners in China, it’s helpful to learn basic behavioral rules. Greetings do not include kisses or hugs, but at most, a handshake. Always address people (especially elders) by their title and surname.

Be punctual — arriving late to a personal or business meeting is seen as disrespectful. Keep your tone calm, and avoid excessive gesturing or facial expressions. Chinese people also dress modestly, paying special attention to neatness and cleanliness. Be prepared to remove your shoes when entering a home or some establishments. Always wear clean socks for this reason.

Business Communication in China: Etiquette Features

General rules:

• Hierarchy: address people using their surname and official status.
• Avoid categorical refusals; the concept of mianzi — "saving face" — is important.
• Do not expect decisions to be made during the meeting; many issues are coordinated with senior management and colleagues under a mutual support principle.
• Be patient and thoughtful; don’t insist on immediate deal closure.
• Be ready to make concessions to reach an agreement.

The ethics of business relationships in China are governed by the tradition of "saving face." Participants avoid direct criticism or refusals to protect reputations. Rushing is also considered a bad form of business in China; final decisions are often made at subsequent meetings, allowing time for reflection.

Business partners or colleagues may invite you to a meal to establish guanxi — personal relationships and connections:

• Regular meetings and communication are important.
• Follow gift and service exchange etiquette.

Chinese people spend a lot of time maintaining guanxi. Do not decline invitations, and try to adapt to local etiquette if you are seeking long-term cooperation.

Other standard features of business etiquette in China include:

• being punctual,
• preparing all necessary documents for meetings,
• clearly formulating requirements and questions.

This will help ensure productive negotiations without wasting either party’s time.

Features of Business Negotiations

National specifics of negotiations in China can be confusing, so we’re sharing tips from our experience to help you get better deals:

• Mention that you are considering multiple partners. This negotiation tactic shows you need the best conditions (to keep you as a client). Additionally, keep a backup supplier in mind to account for potential force majeure.
• "We will think about it" often means "no." Following etiquette, companies avoid direct refusals. Don’t waste time and continue looking for suppliers in China.
• Negotiate wisely. Competition is fierce, so prices may initially be quoted higher than market rates. Additionally, there’s usually room for concessions. Ask for discounts on bulk orders, and clarify what bonuses you might get — free branding, free warehouse delivery, etc. If the manufacturer suggests a different material or packaging, check if it reduces costs. If so, negotiate accordingly.
• Final decisions will be made only after receiving control samples. These will reveal the actual capabilities of the supplier or factory.
• Document all agreements in writing. When signing a contract, mention that you want an on-site inspection in China.

The Chinese style of business negotiations focuses on finding mutually beneficial conditions and fostering long-term cooperation. Etiquette plays a significant role, and foreigners often struggle to understand it. While the Chinese may seem slow, evasive, or distrustful, this is simply a misunderstanding of their national and business culture.

In-Depth Topics in Negotiations

Business negotiations with the Chinese differ due to their unique etiquette and national characteristics. Particularly sensitive topics include signing NDAs and including sanctions and penalties in contracts. Harsh wording can undermine trust, so approach these topics delicately.

• Production Risks

The Chinese market is not perfect; errors and inaccuracies can occur in goods manufactured for export. Discuss all details with management — from exact timelines to technological specifics. Ensure agreements are clearly documented to protect your position in case of disputes.

• NDA

A non-disclosure agreement protects your designs and brand. Intellectual property rights in China are a topic of debate, but your business needs an NDA. Include reasonable and practical sanctions in the contract, and focus on negotiation and reconciliation in the event of initial breaches rather than on punishment.

• Fines, Penalties, Sanctions

Avoid starting with specific proposals. Begin with light measures and gradually navigate toward solutions acceptable to both parties, ranging from initial warnings to financial penalties.

Contrary to myths, business relationships in China are clearly regulated. There are regulatory bodies and laws that protect both clients and manufacturers. However, contracts must be legally sound.

Where to Find a Negotiation Mediator in China

Business negotiations in China differ from those in the West. The main barrier is the language. The best offers are often found on the domestic market, where English proficiency is lower. That’s why DiFFreight not only helps with sourcing and purchasing goods in China but also offers negotiation mediation services.

Our team includes experts fluent in Chinese and knowledgeable about business etiquette. They will convey all your requirements and ensure they are clearly documented in the contract. Don’t risk searching for manufacturers independently, especially in the domestic market, without knowing the language.

Additionally, we offer cargo delivery from China to Ukraine — by sea or air (with transit through Poland). We help you establish a business in China from scratch by handling negotiations and logistics. Schedule a consultation to learn more!