It is pretty clear to all Chinese people that Westerners usually do know something or two about China even before getting there.
Of course, a country with alone more than 17% of world population is supposed to be something people know about. Unfortunately, not everything a person knows about China (or anything else, for that matter) is unmistakably true. China’s political situation over the years has changed together with its importance on the world stage – and the info that media transmitted changed as well.
Since not everybody is able to study in detail the history and the culture of China – as they can take several years to understand even in part – most businessmen will choose a consulting company to get some local help for such a different market. Still, a smart businessman needs to understand whether the consultant is being honest or not. After all, you are entrusting a group of people, or sometimes a single person, your brand as it is going to be seen by 17% of the world’s population.
You will need to protect your interests and make sure you can trust them.
What do you need to be worried about?
First of all, most consultants – both Chinese and Westerners working in China – know very well the differences between Chinese and Western mentality, and surely they know many of the typical stereotypes about Chinese culture that Westerners have, and vice versa.
Some of them (we repeat, there are both Chinese and Westerners in this group) decided to use those stereotypes for their own benefit, mystifying the essence of their job to make it look something worth millions when, actually, although it may indeed be a work done properly and deserving a proper payment, it is definitely overpriced.
How to recognize those scams:
1. High bureaucracy expenses: those are among the ones people can lie the most, especially to those who do not want to have to look at paper and documents available online. Unfortunately, if you don’t want to get scammed, you need to look at them. Make sure you do not get tricked just because you do not like to deal with numbers. Any consultant has the obligation to give you all the real expenses reports and make sure you can understand them. Some Westerners will think China, due to its unique government form, will likely have expensive and complex bureaucracy for even the most simple of the tasks. It is not so, often it’s the opposite. Many procedures are actually cheap and they do not require a PhD to do them. There may be differences with your home country, but do not expect crazy stuff. Most of the things can be done quickly and effortlessly if you know what to do. Paying for that help and knowledge, though, should not be too expensive. Take a look at other competitors and make sure the quote you receive is balanced. Use this logic for every product or service: especially in China, competition can be fierce and this lowers the prices – but there still will be scammers, just like in every place. Keep your eyes open.
2. “Guanxi” (special relationships/connections): they are very useful and sometimes can make or break a business. But do not think you will never be able to get into a business just because of not having the “right guanxi”. Chinese have believed in meritocracy for millennia: if you are good at something, it’s perfectly right that you should do it. They may not trust you right away without a good “guanxi”, but contracts exist for this exact reason. On the other side, if you plan to get into a business only through “guanxi” even if you are offering something totally overpriced, do not expect long term success. Competition will catch up with you.
3. Do not abuse freelancers: having a translator who can help you speaking with your partner in China is very convenient, but make sure they are working directly for your business, or they can be trusted. Though the first approach can be done through a partner company, you need to make sure that they are doing your interests and not theirs. This is actually common sense and true for every country.
4. Get a second opinion: Do not trust strange “laws” or “business practices”. Follow your gut. If something looks fishy, it probably is. Get a second opinion, even if you’re going to be charged – it is better to know now than to find out after months or years. It also helps to have a confirmation your consultant is being honest to you, so you know you can rest assured.
SinoActive offers a free “second opinion” channel, ask us anything!