Hostility between China and the West stems from China’s increasingly aggressive behavior toward Taiwan, China’s COVID-zero policy, and many other issues facing foreign companies doing business in or with China. A rise in the number of foreign companies doing business in or with China. China to re-evaluate. Nancy Pelosi’s visit to Taiwan is really bad for your China business, and sourcing products from China is even more risky.
In this context, international manufacturing lawyers in my firm are seeing an increase in calls and emails from businesses. Looking leave China. Most of these companies want to know more about Mexico.
I asked my good friend Andrew Hupert to explain what is involved in moving manufacturing from China to Mexico, mainly by comparing the two countries. I chose Andrew for this very difficult task because he has spent a lot of time navigating the manufacturing systems of both countries from the inside. My law firm knew that Andrew lived in China, and he consulted with Andrew frequently when he first started practicing law in China. For decades, Andrew has linked his life and career to China, as I have, but he was one of the early proponents of a post-China manufacturing world. Andrew moved to Mexico where he reactivated his Spanish language skills and began helping businesses navigate Mexico, especially those looking to move away from China. So who better than Andrew Hupert to write about what it takes to leave China and move (in whole or in part) to Mexico?
Below is Part 4 of our long-running series. This episode explores negotiation tactics that Andrew, who has taught many negotiation courses at his schools in major businesses around the world, is familiar with.
Continuing with Andrew in Part 4. . .
Western managers with experience in China know the challenges (and risks) involved in cross-border negotiations. Those considering moving to Mexico will have to navigate a new set of cultural adaptations.
1. The end of the story
Chinese negotiators are known for being patient pragmatists. They wait as long as they need to for the right opportunity or resource. But if they feel the counterparty has run out of utility, they will look to other opportunities — already under development. Mexican negotiators are determined but skeptical. They will evaluate you, evaluate your offer, and evaluate your environment before making a decision. If you are used to China, the abruptness of their decision-making may seem uncomfortable to you – especially if the answer is a clear NO. In Mexico, the ability to determine the next step is a sign of leadership. , unlike China, where attention is often valued.
The general atmosphere of the negotiation process is also different. Chinese negotiators hope the process moves forward. They love negotiating and see it as their manager identity and basic leadership skills. Mexican negotiators typically do not consider trading their main job. They want the negotiations to end so they can get down to business.
2. Analysis
Let’s take a closer look at three key differences that US and Euro negotiators should keep in mind when negotiating with their Chinese and Mexican counterparts.
- Cultural Profile: Perseverance and determination.
- relationship history. Ugly but different.
- No! vs.difficult
A. Cultural profile
My main tool for analyzing culture is the “Hofstede 6 Dimension Cultural Comparison tool”. Culture has six dimensions. Each culture is ranked based on its position between diametrically opposites.
- Power distance (How do ordinary people feel about the unequal distribution of wealth, power and influence?)
- Collectivism vs. Individualism (How Is Society Oriented To Teams?)
- masculine or feminine (live to work or work to live?)
- Uncertainty Avoidance (Is it OK not to know what will happen next?)
- Traditional vs. Practical (Long-Term Orientation – Fight the Future or Fit the Future?)
- Indulgence vs. restraint (immediate reward vs. patience for future gains)
B. Similarities between Mexico and China
Both cultures love relationships and networks.Both China and Mexico are expensive power distance and high collectivity Score. This means they respect authority and are comfortable in group situations.
masculinity Scores are slightly higher in both cultures, indicating that both are fairly aggressive, oriented towards making deals, and somewhat competitive. All of these scores are “normal” and reveal nothing surprising.
C. Mexico and China are in contrast.
Dimensions #4 & #6. Avoiding uncertainty When indulgence Key to understanding the differences between Mexican and Chinese negotiators.Mexico scores a whopping 97 points indulgence Dimensions compared to the Chinese ultra-patient 24. But wait.please see Avoiding uncertainty An index to see how each culture feels about uncertainty, loose ends and lack of clarity. Mexicans hate this feeling and score a very high 86 here. I have said that the reason why Mexicans are so sensitive to uncertainty is that they feel they have little control over their daily lives, so they are always afraid of new turmoil and difficulties. It’s actually pretty “okay” about sex. As a result, Mexican negotiators have been very decisive, making seemingly snap decisions to “settle the issue” by bundling outstanding issues, even if it was only a temporary solution. , new difficulties will soon arise. China’s default setting for relationship building is to develop every potential relationship until there is a reason not to.
Also need to discuss long term orientation index. LTOs It does not imply patience or planning horizons.that is indulgence index. LTOs It deals with how culture relates to the past (traditional) and the future (practical). Do you fight the future (“That’s not what we always did/It’s not the way my father did it/It’s not the way God wanted it”) or do you try to fit in with the future (” I know we are distrustful communists, but if our grandchildren spoke English and owned property, they would be richer.”) scored a very practical 87 on They are all about preparing for the future. Mexico (like the US) sits at the other end of the scale with a very traditional 24. That means Mexican negotiators may need a lot of persuasion before agreeing to try something new.
D. Bad History – Different Attitudes
Negotiators in Europe and the United States are happy to leave their historic baggage at home when negotiating across borders, and in the previous commercial environment, their counterparts were willing to go ahead. See Globalism 2.0 here. His five main characteristics of the New World Order.
But now some of the nasty elements of our history (the century of humiliation, invading and annexing half the country, etc.) are popping up in our conversations and on social media. did not give As long as we remembered to give instructions slowly and loudly and didn’t jokingly threaten military action, we were fine. I have visited the company twice.
But now, anti-Western/anti-American propaganda in China is official, relentless, and ultimately effective. As you know, China was occupied and divided by the West and Japan during the ‘Hundred Years Country Bǎinián Guóchǐ (百年国耻 Bǎinián Guóchǐ)’. We were all happy enough to forget our ancient history (1839 – 1949), but now it’s back in vogue.Chinese nationalism is a brand to Chinese consumers in dire straits. It’s a marketing threat. Maintaining a China-friendly brand while adhering to US/Euro policies is difficult (i.e. his H&M in Sweden boycotted in China to comply with Xinjiang’s cotton ban). As relations between China and the West continue to deteriorate, Western brands and manufacturers will suffer even more.
In Mexico, history isn’t as good, but the business impact couldn’t be more different. and was the capital of Tejas (now Texas, Arizona, and most of California). 1835. Good people in Dallas may not be particularly thrilled about this, but Mexicans in the thriving Northwest states of Coahuila, Nuevo Leon, and Tamaulipas speak of their close ties to Texas.
Negotiators approaching Mexican counterparties should be prepared. The people across the table can be conservative, religious (Catholic), and transaction-driven. The English-language media (even commercial sites) have a deeply skewed view of the average Mexican. Cartels, refugees and all-inclusive resorts are not common topics of conversation in Mexico. Mexican manufacturers see themselves as part of the larger US economy, and Mexican business culture aligns with the US as much as possible. When starting a conversation in Mexico, don’t be surprised if they immediately want to dig into the details. Your Mexican boss wants to do business with you, but won’t stray too far from their (commercial) comfort zone. A Mexican negotiator will decide if you (and your product) are the right fit and start building the relationship. Focus on your business.
E.No! VS difficult
Chinese negotiators deserve a reputation for not saying no directly. In Chinese, it often sounds abrupt and rude. Mexicans have no problem saying no. This is the downside of Mexico’s decisiveness. Mexicans tend to be skeptical of your intentions and commitments and often err on the side of caution. Throughout history, Mexicans often lost control of their destinies. If the Mexican coach has the opportunity to make a decision, they will do it. If your Mexican counterparties are skeptical of your offer, they are more likely to decline early rather than explore the potential for a big win.
This contrasts with Chinese negotiators who value relationships and networks. Chinese negotiators are very patient about their deals, but they feel you might be of value to other members of their network, so they want to end the relationship. It’s worth keeping. That’s why you often hear words from negotiators in China that it’s “difficult” and “the timing is bad, but it may change.” It is important for Chinese negotiators to have clear time ranges and deadlines. Danger is an instant NO in Mexico, but in China you have to beware of endless pauses.
3. Conclusion
The biggest differences between Chinese and Mexican negotiators relate to timing and transparency. In China, starting a relationship is easy, but it may cost you a lot of time and energy and yield nothing. details and the broader business environment to determine if you are a legitimate trading partner. If your deal makes sense and you seem like a committed partner, you can start the relationship building process. You want to get to a high-value, long-term business relationship, but you take different (almost opposite) routes to get there. As you approach Mexico, do your research, ask the right questions to get involved, and take the initiative to discuss your commitment to the trade.
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