With China’s continued economic strength and its central role in global consumer and supply-chain markets, the importance of effective negotiation in international business remains high. As a result, negotiation skills tailored specifically to the Chinese business context are in ongoing demand.
Successfully negotiating in China requires more than technical expertise or a well-crafted proposal. It calls for a clear understanding of cultural expectations, communication styles, and relationship-building norms. These factors can shape not only how negotiations unfold, but whether they move forward at all. The following negotiation tips can help you navigate the negotiation process in China more effectively.
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Reciprocity and Relationships Matter
Reciprocity is a feature of negotiations around the world, but it plays a particularly prominent role in the People’s Republic of China. Relationship-building is essential, yet it comes with expectations. Favors, flexibility, and cooperation are often understood to create future obligations.
For negotiators, this means building relationships thoughtfully and deliberately. Aim to engage counterparts in ways that respect their expectation of reciprocity while still protecting your organization’s interests. The goal is to create value on both sides without losing sight of the most favorable negotiated agreement possible.
Contracts alone rarely carry the same weight they do in many Western business settings. Rather than serving as exhaustive documents that anticipate every contingency, contracts in China often function as a foundation for an ongoing relationship. Because negotiated agreements may leave room for interpretation, communication becomes especially important after the deal is signed—not just before it.
This dynamic helps explain the importance of guanxi, the network of relationships and mutual obligations that underpins much of Chinese business culture. Understanding and respecting guanxi can significantly influence negotiation outcomes.
Negotiation Strategy 1: Take Your Time
In China, lasting deals are rarely negotiated in days or weeks. More often, they unfold over months—or even years.
Patience signals seriousness and respect. Attempts to rush the process can be interpreted as a lack of commitment or cultural awareness. Allow time for trust to develop, information to be exchanged, and internal consensus to form on the other side of the table.
Negotiation Strategy 2: Make High-Level Contacts
When possible, seek access to negotiators who hold real authority. Senior officials and executives are often better positioned to exercise discretion, adapt to changing circumstances, and approve creative solutions.
Reaching out to high-level contacts does not mean bypassing established channels, but it does increase the likelihood that negotiations will involve individuals who can move the process forward when obstacles arise.
Negotiation Strategy 3: Avoid the Gold Rush Mentality
The size and dynamism of the Chinese market can tempt negotiators into making premature commitments. The promise of rapid growth or first-mover advantage should not replace careful evaluation.
Make sure the deal truly aligns with your organization’s long-term goals and risk tolerance. Walking away from an ill-fitting agreement is often wiser than pursuing a deal driven by urgency or fear of missing out.
Strengthen Your BATNA
Finally, continue to develop your best alternative to a negotiated agreement, or BATNA. A strong BATNA remains one of the most effective safeguards against hardball tactics—whether in China or elsewhere.
When negotiators know they have a viable outside option, they are better equipped to remain patient, resist undue pressure, and negotiate from a position of confidence rather than necessity.
What are your thoughts on the negotiation process in China? We love to hear from our readers. Leave a comment below to let us know what you think.
Related International Negotiation Article: The Importance of Relationship Building in China – Relationships in negotiation are critical in China.
Overcoming Cultural Barriers in Negotiation: China and the Gold Rush Mentality – The importance of communication in business with international clients hinges on both effective negotiation techniques and a cultural understanding of your counterpart
Claim your FREE copy: International Negotiations
Claim your copy of International Negotiations: Cross-Cultural Communication Skills for International Business Executives from the Program on Negotiation at Harvard Law School.
Adapted from During the Gold Rush: Negotiating in China for the Negotiation newsletter by Ray Friedman.
Originally published June 2013.
THE negotiation process in China? A better heading would be ‘The Multiplicity and Complexity of Negotiation Processes in China’.
I’m interested in the converse — advice for the international community for how to negotiate with Americans.
In my experience, the negotiation in China is far more complex than what I’ve seen elsewhere. It takes a long time to understand the motivations and specific needs that are behind the demands of the Chinese. In some cases, requests just do not seem to make sense if you don’t dig deeper. But when you make the effort of understanding, and try to meet them half-way when you do, you are solidifying trust and a long-term relationship. That can be acheived only if regular face-to-face meetings occur.