Putin’s visit to China in October has brought numerous promising projects for bilateral cooperation between China and Russia. More and more Chinese companies are becoming involved in deals with Russian companies, both in exports and imports.

However, when doing business with Russian clients it is important to understand their way of thinking, especially when you are looking to sell your products on the Russian market.

From my personal experience in sourcing for Russian clients from Chinese producers, the following issues—standard with any sourcing project—must be managed: price, quality, supplier reliability, delivery time, payment terms, availability, product certification, and transportation time, etc. What are the most critical issues specific to Russian companies? The top three would have to be payment terms, product certification, and language barriers.

Language

Effective Communication is a crucial aspect of any business deal. The existence of a language barrier is a particularly formidable challenge faced by Chinese companies aiming to enter the CIS market. Effective communication will allow certainty in the decision-making process; misunderstanding, however slight, may lead to unexpected troubles or worse—failure. The simplest way to avoid these unnecessary pitfalls is to have an effective conduit between your company and the client. A few of the best ways to do this are:

1. To establish a local representative office
2. To find a solid partner in Russia
3. To hire a long-term translator in your domestic office
4. To hire a short-term translator during your client’s visit to your factories or during your trip to Russia

The listings above are ordered according to the level of importance of the prospective deal. The first option is most acceptable for a Russian client, while the third and forth options are the easiest options to use when visiting a Chinese company. Any aggressive, long term, business expansion into Russia would require a representative office in Russia or even a joint venture with a local Russian company.

To be continued