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The first few days may be devoted to getting-to-know-you chitchat, but shortly the Chinese will start asking technical questions. This probing can go on for days; indeed it tends to become a test of patience as well as expertise. Voices should never be raised. Says David Janet, an executive of Houston-based Pullman Kellogg, which has built eight ammonia plants in China: "To the Chinese, an indication of anger is a demonstration of a loss of self-confidence." On the other hand, says Mike McDaniel, a negotiator for Micrometrics of Norcross, Ga., which is selling chemical and pharmaceutical equipment to Peking: "I've been in countries negotiating with people hostile to me because I am American. But the Chinese really want our help." McDaniel also found them very candid about how far behind the West they are in technology.
When the talks turn to price, Chinese negotiators usually ask a Western firm to quote first, and then bargain hard for a discount, sometimes implying strongly that a competitor will provide one. But unlike the Russians, who haggle in the fashion of bazaar rug merchants, the Chinese when they finally state a price quote a realistic one that they actually expect to pay. Perhaps the worst mistake an American company can make, next to coming to Peking unprepared for highly technical discussions, is to quote an unrealistically low price to promote an initial sale. The Chinese will snap it up—and expect the same price on all future deals. Another nono: trying to skim the market for a quick profit on a single sale. The Chinese will not only turn down the deal but blacklist the firm, because they want to develop long-term relationships.
While all this goes on, social life is another problem. The Chinese will invite a visiting American to at least one banquet at which they offer many toasts to "friendship"; each toast is followed by a call for "kan pei" (bottoms up), and form requires that both the toaster and the head of the guest delegation must drain their mao tai glasses and then hold them upside down to show they are empty. Some thoroughly toasted Americans have observed that the Chinese rotate the toasting duty among themselves, while the U.S. delegation chief has to do this bottoms-upping every time; it is both wise and permissible for him to inform his hosts courteously that, say, four such toasts are his limit. It is also wise for an American group to arrange a dinner for its Chinese hosts. Aside from trips to the Great Wall and the Ming Tombs, businessmen find little to do in Peking but business. Evenings tend to be spent at the hotel puzzling over just where the negotiations stand.