Category Archive guanxi

Guan Xi, the key to business success in China

While the Chinese business market is constantly modernizing, adapting, and growing; there is still a concept of immense cultural importance that has governed Chinese business practices for many years. The notion of 关系 (Guan Xi) is essential for any company to understand if they intend on doing business in China.

At its core, guan xi is about building relationships. Trust is crucial to business success in China, and it is something that does not come quickly. While it may seem counterintuitive in the current fast-paced business environment of the United States, a great deal of relationship building in China exists outside of conference calls and boardroom meetings. In China, face to face interaction helps build a kind of trust that simply cannot be acquired through only communicating through a phone speaker halfway across the world. Because of the integral part that guanxi plays in Chinese business; it is essential for an American company hoping to do business in China to make sure that they have a strong understanding of Chinese culture in order to build a strong relationship with Chinese businesses.

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How to save money and time through effective negotiations.

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Without any discussion, money and time are the most valued resource for business. For western companies, traveling to china can be an investment due to the utilization of this two resources. Think about the costs of traveling, lodge, transportation, and the time spent on meetings or any process like registration and permits application. This case is about how one of our clients has saved through our effective negotiations.

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Chinese Manufacturing Under American FDA Regulations Made Possible

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Mainland China acts as a manufacturing powerhouse for many American companies, producing their products at a competitive price. The majority of the goods exiting these factories, however, face a common issue: quality and safety standards often don’t comply with American FDA regulations and are therefore rendered inadmissible for import into the USA. This is mainly the consequence of miscommunication between those placing the order and those executing its production.

Product manufacturing in China requires more than a vague manual or basic design, and the language and business etiquette display much greater obstacles than you’d think. Let me elaborate.

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Why You Need a Flexible Support System in China

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The problem

We always look to  provide the best support to our clients, but due its size, China can be an overwhelming country , so we understand when our clients are hindered to come directly to our office in Shenzhen. Just recently, one of our clients, a paper products manufacturer, was looking into moving part of his manufacturing process to the South West region of China. Since the team of three was on a strict time schedule they were not able to come to Shenzhen personally in order to meet with Incorp China’s team to discuss the bureaucracy behind such a move.

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Opening Up a Bank Account Under Tightened Restrictions – What You Need to Know

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Why opening a bank account in China is more difficult today

It is no secret that the recent crackdown on money laundering has left foreigners struggling to open a bank account in China. As a result, it has become even more beneficial for foreigners, seeking to move or extend their business to China, to consult an agent on the ground. The reason why there are so many China consultancies on the market is because it’ is quite challenging as well as time and labor intensive to get a company approved. Only a few of these China consultants are as committed as Incorp China, connecting with the government bureaus and banks, forming friendships, and therefore getting our clients the service they deserve.

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Why Employing China Consultants To Solve Banking Issues is a Must

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Nationalities are a way of creating a sense of belonging. As soon as you are born, you are gifted one, sometimes two, nationalities. They play an important part in how you identify yourself throughout your life and they can come with – or prevent – great liberties. The problem with belonging to one nationality is that, as soon as you take a step beyond your mother land’s borders, you are a stranger. It is human nature to protect what we know and recognize and seek distance from what we see as foreign and unknown. Whether executed consciously or subconsciously, this behaviors is deeply engraved in our DNA.

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Shutting Down a Foreign Owned Entity in China – IncorpChina’s Visit to the Local Tax Bureau

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Last week, three Incorp China team members and the CEO, Robert Fisch, headed to the Shenzhen tax bureau to help one of our US clients on shuting down their entity in China. When shutting down a foreign company in China, the tax bureau has to issue a “notice of cancellation of tax registration”’ for the Foreign Trade & Economic Cooperation Bureau. This is a rather difficult and time intensive procedure: The company owner, or a representative thereof, has to physically visit the local tax bureau in order to fill out and hand in the requires paperwork. While some documents are in English, the majority of the procedure will necessarily be dealt with in Mandarin. This highly bureaucratic task involves dozens of different forms that are each tailored to the nature of your business as well as the reason for its closure.

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How Important Is To Have Local Representatives In China?

China, money, Yuan, Renminbi, bank, currency, economics, market, growth, legislation, law, change of law, change of legislation, security, opening up business, WOFE, FICE

While every business needs to keep a tight grip on their expenses, some investments do truly pay off. One of such investments is hiring a local company in China to represent your business here. Why? Because Chinese bureaucracy and law is of complicated and ever-changing nature. Even more importantly, here, nobody stands a chance doing paperwork over the phone. Doing business face-to-face remains the most effective and respectful after all.

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In China, Guanxi Can Open Many Doors – And Borders

Some life lessons are best conveyed through a story. This one is about never underestimating what power an extensive guanxi holds in China.

 

Guanxi is the mandarin term for the network, the connection people form privately and in business relation to one another over a long period of time. Other than in Western cultures, China doesn’t differentiate between personal and professional relationships. Upholding one’s ‘face’, one’s reputation, making new connections and maintaining them becomes an omnipresent necessity.

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