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The real deal on courting China

A consultant with 25 years' experience dispels some myths and warns of pitfalls .

By JAMES THORNER
Published October 25, 2006

Trade and investment with China need not be a one-way street.

A Shanghai businessmen said Tuesday he's scouting real estate in the Tampa Bay area to lease or build a multi-story Chinese commercial pavilion.

Bin Liu, vice president of Shanghai area chamber of commerce and a developer in his native city, suggested the building would house separate floors for different Chinese products, including tourism, crafts and jewelry, seafood and furniture and textiles.

"They even have a name for the place already, New Shanghai Bay," said Hongling Han-Ralston, a Tampa lawyer who translated Liu into English.

Shanghai delegates at Tuesday's Chinese Expo suggested the pavilion was part of the Beijing government's plans to invest its export-generated billions overseas.

Liu spent part of this week sizing up the Tampa business climate. Not all the news was good: his American hosts filled him in on the intricacies of zoning and permitting. "He's concerned zoning will take a long time," Han-Ralston said.

As many an American developer could tell him, "Welcome to the club, Mr. Liu."

-- James Thorner

TAMPA - Tim Heberlein wants to clear up tales about the fabled cheapness of doing business in China.

It's not cheap. Not anymore, at least.

With the exception of food and factory floor labor, China is more expensive than the United States, starting with the $7,500 business-class airline ticket to Beijing.

The Chinese cheapness theory was among the tainted advice Heberlein, a China consultant for 25 years, rejected as a "bushel basket of horse manure" Tuesday during a speech at China Expo 2006 in Tampa.

If you don't do proper research as an American businessperson in China, "you are going to get spanked," he said at the gathering organized by the foundling Chinese Chamber of Commerce of Tampa Bay. As an exporter hoping to tap the vast Chinese market, that means paying at least $30,000 for expert field research of local tastes.

Heberlein noted that China is growing so fast as a manufacturing hub that the nation of 1.3-billion actually suffers a labor shortage. The problem is no less acute among educated Chinese. Only 10 percent of university graduates are suited to work for multinational corporations, he said, citing language and organizational inadequacies.

Heberlein preached a wariness of Chinese negotiating tactics. No tougher wheeler-dealers exist this side of a Middle Eastern bazaar, he said. They can spot a desperate American businessman a mile away and will "slice and dice" him at the bargaining table, he said.

How to win the battle of wills? For starters, get yourself a Chinese name that rolls off the tongue of Mandarin-speaking business partners. But "don't go to the Golden Phoenix Restaurant and ask the waiter to give you a name," he said.

It's also wise to get your own interpreter rather than use one provided by the Chinese partner who might omit key words. Chinese statistics are also suspect: Officials tend to regurgitate what their party superiors expect.

And Heberlein's lesson on Chinese pricing: Never pay full price. "Start at one-third the quoted price, and never pay more than half," he said.

All in all, an American eager for business partners will need to wine and dine the Chinese, both figuratively and literally.

"Business lives or dies in China in the human dimension," Heberlein said. "It's about people relationships."

James Thorner can be reached at 813 226-3313 or thorner@sptimes.com.

[Last modified October 25, 2006, 00:18:46]