What’s the toughest part about doing deals in China? Is it finding potential partners, negotiating terms or getting everyone to actually do what they have agreed to do?

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-Andrew

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If you do sales in China, then you probably want to develop some new ways of getting past the “gatekeeper” and reaching the real decision-maker. One of the big differences between Chinese and Western selling is the degree of access to the real decision-maker. In the US, you will usually have to meet the decision maker before anything happens. It’s part of normal due-diligence. But in China it is quite common for a deal to be done without the salesman ever meeting the true decision-maker. If your strategy is to get around the gatekeeper, you may be wasting your time. You are better off turning the gatekeeper into a messenger or a supporter. Check out the full article for more details.

Experienced Chinese salesmen talk about another option — going around the gatekeeper and making contact with the boss directly. I call this one “ambushing the decision-maker”. It’s great if it works, but make sure that your relationship with the boss is strong enough to offset the blind hatred that the gatekeeper will feel for you. A high risk stategy, here in China. Use with care.

What about giving gifts to gatekeepers to make them more cooperative. To be honest, I was a little surprised to find out that this is still a common practice in developed markets like Shanghai. If you feel that this is really beneficial, then go for it. But it’s definitely NOT a good idea when approaching international firms. Even Chinese members of an international DMU (decision-making unit) will probably shy away from the practice. While illegal in the US, there is a much more compelling reason for the gift-giving habit to leave the business scene. I can’t think of a single Western business owner or high-level manager who wouldn’t fire a junior manager who took gifts in exchange for access to the DMU. If anyone is going to benefit from a purchasing or partnership agreement, it should be the company owners, shareholders and senior managers. Junior managers who take gifts are considered to be stealing from the boss, and are rarely given a second chance.

Chinese salespeople prefer to put off the price discussion until after they have built up a strong relationship with the potential client. They will then do their best to learn the buyer’s opinions about his budget and resources, and to gradually develop a price package that both sides can live with.

Western buyers, however, do not operate this way — particularly in the B2B (business-to-business) corporate environment. Western buyers will often ask for detailed price information very early in the sales process. This can make Chinese sales representatives VERY uncomfortable. If you are selling to westerners, you should know two important points:

1) Western businesses often have a system for making large corporate purchases. They start with a long list of all the companies who may be able to sell them the needed product or service. When a potential client is putting together this list, they are really just gathering information. They have specific standards and criteria about how to choose a supplier, and price-range is one of the key points they will look at. So if you price is too high, your company will not make the “short list”. That is why some western buyers don’t seem to care too much about building a relationship at the beginning. Once their list of possible suppliers has been cut down to a few candidates, they will spend more time getting to know each company’s strengths and special characteristics.

2) Western buyers feel that the price breakdown tells them a lot about your company and the product offering. A western-style buyer sees price as being more than just a dollar or renminbi figure. They are very interested in the logic and “thought process” that goes into the price breakdown. For many western buyers, the pricing proposal is a sample of your company’s abilities and philosophy. They expect a comprehensive proposal that includes your company’s solution to his business problem. For the western corporate buyer, the price proposal is really your company’s introduction. If the proposal makes sense to him, it serves as a starting point for all other business discussions. If the proposal doesn’t make sense, then you will probably not get another opportunity to do business.

Always make sure your initial price proposal is logical, comprehensive and defendable.

The ability to “call a sale” or judge the likelihood of signing a contract with a prospect is an important skill — especially in a slow market. When things are really busy and lots of orders are coming in all the time, you don’t have to worry about being able to predict who is a serious prospect and who is a waste of time. But when things are a little slower, you have to know who is a high-value target, and who isn’t.

You just had a meeting or phone call with a client or a prospect. Take a second and think about how the call REALLY went.

Answer these questions as honestly as you can:

1) What kind of prospect are they?
An unqualified lead, a qualified prospect, existing client, or a social contact? There?? nothing wrong with any of those ??as long as YOU know who is who. You should always be working to qualify your leads and learn more about your prospects. And if you are speaking with a social contact to build up your network ??well that?? ok. But just ??k?? This person isn?? going to do business with you, and there is no real guarantee that they will lead you to anyone who will.

2) What business challenge of theirs can you solved?
Can you answer? Do you know, or are you just assuming that you know what their challenges probably are? This is the most important thing you can find out early in the sales relationship ??and you should keep revisiting the question to make sure that nothing has changed.

3) How did they feel about the conversation you just had?
Learn to look at things from the client?? point of view. When I was a young salesman, I felt that the smarter I sounded the better I was doing. Experienced salesmen know that clients don?? always want to deal with someone who is always trying to prove how smart they are. If you talk less and listen more, your clients will think you are a genius.

4) Who else takes part in the decision?
You have a nice, friendly relationship with your contact at the client company ??so naturally you don?? want to ??ock the boat??or change the situation. But there?? a good chance that your sales would improve if you could make contact with other members of the decision-making unit. Find out who makes the decision ??and what their criteria are. Then you can start trying to win them over to be part of your network as well.

5) Why will they buy from you and not the competition?
If they have an existing supplier, you are going to have to persuade your prospect to drop them and start buying from you. What is going to cause them to do that? Price may play a role ??but it probably won?? be the only consideration.

6) Why might they NOT buy from you?
A harder version of question #5. Be honest, and evaluate your own weaknesses. Young salesmen always bring everything down to price, but let?? face facts ??there are a lot of Mercedes Benz being driven to 5-star restaurants in Shanghai and Beijing. There are a lot of villas and Class A retail space being sold. Price really isn?? the ONLY reason people make decisions.

7) What is your next step?
It doesn?? matter if the call was a great success or a complete flop ??you still need to plan a next step. You should always know where you want your sales relationship to go ??and be ready to propose a course of action. Do you want to introduce the prospect to a new product, take him out to lunch, meet his boss, or tour his new facility? Progress doesn?? necessarily mean signing a big contract ??there are lots of little things you can do to move your sale forward. But waiting for the phone to ring is NOT a good next step to plan on!