April 23, 2008

News & Opinion: How to Negotiate Anything with Anyone Anywhere Around the World, Third Edition

By: 800-CEO-READ @ 5:14 PM – Filed under: Management & Workplace Culture

The following is excerpted from How to Negotiate Anything with Anyone Anywhere Around the World, Third Edition by Frank L. Acuff (AMACOM 2008).
Acuff is a professional negotiator, and has put his expertise in a useful book that serves as a great tool for those who are doing business around the world, but haven't had his experience. This new edition includes 63 countries, and provides "Fast Facts" summaries of each nation. Below you'll find the summary for Hong Kong.

Fast Facts
Monetary Unit: Hong Kong dollar
Major Industries: textiles, clothing, tourism, electronics, plastics, toys, watches and clocks
Primary Trading Partners: China, United States, Germany, Japan, United Kingdom
Key Exports: clothing, plastic articles, textiles, electric goods
Key Imports: foodstuffs, transport equipment, raw materials, semimanufactured goods
Major City: Hong Kong (7.0 mil.)
Ethnic Groups: 98% Chinese
Primary Religions: Eclectic mixture of local religions (90%), Christian (10%)
Languages: Chinese (especially the Cantonese dialect); business is conducted in English.
Reducing Communication Noise
- Shake hands lightly upon greeting and leaving. A nod or slight bow from the shoulders may accompany a handshake.
- Typical greetings are Neih hau ma (How are you?) and Neih sik msik a (Have you eaten?).
- Address people by title. The family name traditionally comes first, so Lee Chen is Mr. Lee, or Li Wong is Madame Li.
- Expect that many of your Hong Kong Chinese counterparts will have a Western given name. These names are usually added before the family name. These names are used in business or dealing with Westerners. For example, Steven Chang Tsang might be called either Mr. Chang or Steven Chang in business, or Chang Tsang among Chinese business circles or for legal and formal purposes.
- The term for thank you is pronounced doe-jay, from the Cantonese dialect.
- Acceptable topics of conversation include general inquiries about one's health, business conditions, the excellent cuisine, and Hong Kong shopping.
- Avoid discussing the political situation in China or in Hong Kong.
Avoid wearing blue and white, the Chinese colors for mourning.
Key Negotiating Pointers
- Make prior appointments, since Hong Kong appointment calendars are usually quite full. Be punctual. Although a thirty-minute courtesy time is usually allowed, your counterpart will probably be punctual.
- Prepare a detailed agenda for negotiating sessions, and send this in advance of your trip.
- Don't plan a short visit. Hong Kong is a high-pressure business environment, though the pace of the negotiations remains slower than in most Western countries. While decisions are made crisply, it takes time to build trust and personal confidence.
- Expect the tone of the negotiation to be generally formal and reserved, with emphasis on politeness and mutual respect. Don't be shocked, however, if you encounter Hong Kong negotiators who are louder and more assertive than you may have thought. Hong Kong is a busy place, and a certain amount of aggressiveness sometimes exists.
- Be gracious and respectful, but limit small talk. Expect your counterpart to get to the point after initial formalities.
- Avoid asking direct questions that might embarrass your counterpart. An open conflict could cost you the deal.
- A favorite tactic of Hong Kong negotiators is to remind you of the competition when they ask sellers to lower their price. A favorite approach when asking buyers to pay more is to use facts and information as a basis for building a consultative relationship. This documented information is to help the seller make the sale.
- Hong Kong negotiators tend to make concessions in the escalating pattern, beginning with a low amount and continuously increasing it at subsequent sessions.
- Personal trust will probably be placed above the fine legal points of the deal.
- Terminology in contracts is less problematical than in mainland China, due to experience in dealing with the West.
- Negotiations will be conducted in English, but speak slowly and avoid slang. Politely check for understanding.
- Hong Kong Chinese tend to discuss all aspects of the deal, saving concessions (discounts) until the end.
Work through an agent or commissioned representative.
Day-to-Day Pointers
Business Entertainment Guidelines
- A lunch or dinner banquet is a key part of the negotiating process. Breakfast meetings are not popular.
- Come hungry. Eight- to twelve-course meals are common.
- The most common toast is yum sing. Toasting is an important part of the social etiquette. There will probably be a welcoming toast by your host, and it is customary for you to reciprocate by rising and thanking the host on everyone's behalf at the end of the meal.
- The Chinese retire early and usually leave immediately after a dinner banquet.
- Offer to pay the bill in a restaurant, though your offer will not be accepted. Never offer to split the bill; this would be considered loss of face.
- Gifts are routinely exchanged between business associates as well as friends during the Chinese New Year (usually around February).
- In restaurants, a 10 percent service charge is usually added to the bill, but it is customary to add another 5 percent. Where no service charge is added, 10 percent is acceptable.
Table Manners and Food
- Don't eat or drink before your host does.
- Hong Kong is world famous for its cuisine. Chinese dishes are often prepared with pork, fish, chicken, and vegetables, with rice as the staple food.
Gender Issues
- Hong Kong is one of the best places in the Pacific Rim for international businesswomen to do business.
- Women are on local negotiating teams, influenced by the large amount of business done with the United States, Canada, and other Western countries, and the equalitarian principles of mainland China.
Also Remember This . . .
- Great Britain returned Hong Kong to mainland-Chinese rule in 1997 as the Hong Kong Special Administrative Region. It is a self-governing region of the People's Republic of China. Although China is only officially responsible for defense and foreign affairs, it has considerable influence over Hong Kong's domestic affairs as well.
- Hong Kong consists of Hong Kong Island, the New Territories (a small portion of the mainland), the Kowloon Peninsula, Lantau Island, and more than 200 smaller islands.
- Hong Kong is very cosmopolitan--a blend of Asian and European cultures--and has a highly educated and motivated workforce.
- Hong Kong has severely limited land resources, with a very tight supply of office and industrial property. Its busy harbor is a key to its business.
Excerpted from How to Negotiate Anything with Anyone Anywhere Around the World, Third Edition by Frank L. Acuff. Copyright © 2008. Published by AMACOM Books, a division of American Management Association, New York, NY. Used with permission. All rights reserved. Visitors to this site are granted permission to download or print out one (1) copy of the AMACOM content from the website for personal use only and agree not to reproduce, retransmit, distribute, disseminate, sell, publish, broadcast or circulate this material without prior written permission of the copyright owner (AMA).