Many a book has been written about Chinese negotiation tactics and a reference is often made to Sun Tzu’s Art of War for further reading. However do not let this get to your head – you will not have to read 12 books and 6 research papers in order to negotiate a good contract. Nevertheless, it will give you an advantage to learn about common negotiation tactics. Here are two common tactics used that will be familiar to anyone having done business with a Chinese party.
Tactic 1: Renegotiations after the contract is signed
You negotiated a contract, signed it, and left China. However, the Chinese party suddenly wants to alter some of the key points in the contract. You have already put in a lot of time and effort and finding a new supplier will put your project at risk. The Chinese party knows that and is therefore able to leverage it against you. It is therefore crucial to include in your contract that any breach of contract will lead to termination and a lawsuit for damages. In some cases you will have to concede in order to protect your interests. However, make clear to your supplier how this will affect any future business dealings.
Tactic 2: Wearing you down
This is one of the most commonly used tactics. The Chinese party knows you are on a tight traveling schedule and will try to use that to their advantage. For instance, they may try to constantly introduce new issues in an effort to wear you down and extend the negotiation process. They hope you will at some point give in to their demands out of sheer frustration and time constraints. Making unreasonable demands is also part of the package. You can counter this behavior by refusing to participate in it. Also, stating that you are leaving earlier than you actually are will give them less of a chance to pressure you on time.
What are your experiences?
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