This Article Was Researched And Produced By Posicionarte For China Trading Company, 2007

Business.

The meaning of guanxi - the first chinese word that anybody who does business in china must learn is" guanxi" and what means this word? : china is a country that is developing in a very fast pace and at the same time it is growing. A city where you can set up operations is Shanghai. So many business opportunities are starting to float.

In this city you can stay and meet people, and for those looking to build up their Guanxi, there is always a networking event, conferences and many opportunities to promote yourself and your company along with a few drinks and chips. - but what means guanxi? During the last 2 decades there have been fewer topics more important than to build strong business relationships, and in China the word Guanxi is one of the first words a foreign executive must learn. In a Mandarin dictionary you can find that it is relation. To concern. Relationship.

To affect. - relations. To have to do with. In other words Guanxi is your network of people. How many cards you have. Who you know.

Whether potential customers know of your product. - before to do business in china meant that a foreign executive was interacting only with chinese businessmen in introductions were critical and relationships were coveted. And, if you are in sales, who knows you. Meetings with factory managers, government officials, bankers, and distributors were conducted in Chinese around large tables in rooms that had no heat or AC over scalding hot tea were conducted. It was the first step for doing business in China, and those relationships were critical for the future stability and success of the operations. Meals were eaten, families were introduced, sites were visited, gifts were given, and relationships were, alcohol was consumed raised. But, in the last few years as more and more foreign companies have not only visited China, but also invested in China, the role of relationships has changed.

In many ways, manufacturers, government officials, distributors, and customers are all a bit tired. - when european or american executives once complained about the snails pace building relationships took, many relationships now are built on the business fundamentals of the deal being discussed, and thus are moving much quicker. Many have been visited many times by related companies, all offering the same interest in investing in a particular area, buy a particular product, or partner with a particular company, this has changed, and unfortunately their level of excitement from ecstatic to muted as many did not put their money where their mouth was. Due primarily to the number of companies entering China, there is now a new group of companies entering China that deal solely with other foreign companies, and thus need to have strong relationships with foreign companies rather than Chinese companies. However, on the other side, the importance of relationships with other foreign companies is becoming more and more important for Chinese. This is also true for many who are supplying services like freight forwarding, and many other, outsourced accounting services.

This article was researched and produced by Posicionarte for China Trading Company, 2007