The other day I sat in on a meeting between a European buyer (German, in fact) and a Chinese supplier. My role in the meeting was minimal, so I won't go into that. Rather, I'd like to touch on another subject that I couldn't help but wondering about while I sat and listened at this meeting: how important is it for foreign companies to have foreign staff that speak Chinese?

In this meeting, there were none. The German buyers were new to China and had no understanding for Chinese language, and little understanding for Chinese culture. I was positively surprised that unless the supplier spoke with Shanghai dialect, I could understand pretty much everything they said in Chinese. I could also understand a lot of what the Germans said to each other, as German language is quite similar to Swedish (well, not quite similar, but it is still quite understandable, many words are alike, and so on). To make the negotiation possible there were two young Chinese women who knew the product, the suppliers and the buyers, acting translators.

So there was a total of 6 people and I cannot say that the negotiation went smoothly. Rather, it was kind of painful to listen to at times. Mainly, because they couldn't speak to each other in their native language, and none of them had perfect English, so a lot of information was lost on the way. Also, a lot of times this sort of discussion happened:

Buyer: I think it is too expensive, can we lower the price with 20 cents? Because this and this has been changed so the price should drop a bit...

Translator: I will ask the supplier. (Translates to the supplier and briefly goes over all the changes that has been made, some being clear and some not so clear)

Supplier: It is not possible. The price is already low, ra ra ra.... (the translator and the supplier argues for a good 10 minutes).

Finally, the supplier agrees on lowering the price with 10 cents. The translator turns to the buyer:

Translator: OK, so you can get 10 cents cheaper, is that OK.

Buyer: 10 cents? But I asked for 20? Why only 10?

Translator: (looking tired) She said so. 20 cents is impossible. But it is OK. I will ask again.

The buyers start discussing in German.

Five minutes later, they suggest another change in the product in order to lower the price further. The change is kind of complicated and I can see on the translator that she doesn't fully understand. Still, she says 'OK' and starts to explain to the supplier, I can already tell that the suggested change isn't coming through in her speech, and that the supplier isn't going to bulge. Another 10 minutes discussion takes place. In the end, the Germans get a price drop of 12 cents and no one follows up on the changes that were suggested. Nobody seem really happy and the translator and supplier continues to argue in local dialect for some time.

This whole discussion, over just one product took them more than 30 minutes and that was actually a quite fast example. Other discussions would take up to one hour, mainly because explanations were lost in translation, the supplier didn't understand what the buyer wanted, the buyer didn't understand the suppliers way to think, and so on... I just sat there and wondered to myself if I would have been able to get a better price while negotiating (I wasn't in a position to speak however, so I shut up) since I could have presented my points straight to the supplier. Even though I didn't know all the technical aspects of the product, I still think I could have made my point a bit clearer.

This meeting made me wonder how many meetings are like that here in China. Probably loads. Even though the number of foreigners that can speak Chinese is rising, I still don't think it is that common that meetings/negotiations can take place completely in Chinese at foreign enterprises. It takes a long time to master Chinese, and besides, even though a foreigner could speak Chinese, s/he might not be up for negotiating with a local that prefers negotiating with another local... Also, it is obviously not enough to know Chinese, u have to understand the Chinese culture too (although if you have studied Chinese in China for some years you probably will have a quite good idea of the 'Chinese way')

Obviously, since many Chinese people nowadays speak English, it is more common that the meeting is held in English. But I believe many details can be misunderstood when a meeting is held in a non-native language, especially if the other part is German/ Swedish/ Italian/ from whatever country where English isn't the population's first language. Also, I sometimes feel that Chinese people, even though they don't understand your point, will say 'OK' just because they don't want to seem stupid/lose face by asking you one more time. I think the culture gap between a European country like Germany and China makes the negotiation a bit harder than usual, for both parts. I wonder how much smoother it could have gone if the German company actually had someone German who could negotiate/explain her points in Chinese.

What do you guys think? How important do you think it is for a foreigner to speak Chinese when doing business in China? How many misunderstandings can be avoided? Or, is English enough?