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Koreans consider a person’s character
to be just as important as the contract or deal. To be successful you must
develop a trusting personal relationship with your business partner. As part of
developing this relationship Koreans spend time on business socializing. It is
important to accept social invitations and to reciprocate. It may appear at
first that business is not a major part of the agenda but of course, it
certainly is.
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Koreans prefer group consensus as their
decision-making model. The senior person makes the final decision. Koreans tend
to be very conservative and risk averse.
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Aggressive or adversarial negotiations do not work in Korea. Your
opposite negotiators may appear on the surface to agree just to keep discussions
harmonious. You must give the average Korean time to reach agreement or the deal
will never happen. They can appear to be rigid, stubborn and unyielding. You
need to be clear about your position. It is best for you as the foreigner never
to raise your voice or become visibly frustrated, unless absolutely necessary in
the final stages of the negotiation. Remember that in making a decision the
Korean businessperson will consider personal relationships and character as well
as business.
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Koreans do not like to say “no” directly and want to preserve
harmony under all circumstances. You may need to ask several indirect questions
to get to the true response.
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Avoid the word “win” which implies a one-sided benefit – the goal
is harmony so use words like “we would like to receive the contract ” are more
appropriate
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Koreans as other hard bargainers will seek to gain as many
concessions as possible from you.
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If you are asked the same question repeatedly it is to ensure the
consistency of the information so no mistakes will occur.
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Most Koreans are concerned with price over cost efficiency or
effectiveness. Usually the top three proposals are invited to a financial
review. The winning bid is usually the lowest bid passing the technical review.
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Historically foreign firms have fared best when they work in
collaboration with a Korean company.
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Written contracts should be used in all transactions. Koreans view
of contracts is different from the Western view. Koreans see contracts more
loosely, believing they allow room for flexibility. Often the rules will change
as the situation changes, it is important to be specific about responsibilities.
This different view of contracts can be problematic and it is therefore
advisable to consider and discuss future situations.
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Many South Korean professionals are accustomed to Western customs
because they studied or worked overseas.
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Almost all the businesspeople have some familiarity with Western
culture. Government officials however tend to be more traditional and
conservative.
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Most Koreans have three names: two given names and a surname. You
should feel comfortable asking a person how they would like to be addressed.
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Asians tend to be more formal initially. When addressing a new
acquaintance use formal titles such as “Mr.,” “Mrs.,” or “Dr.” High educational
attainment is respected throughout Asia. Those with Ph'd degrees are usually
addressed as Dr. and then their family name. First or given names are considered
personal and are rarely used in business. Wait to be invited to use first names
and don't be offended if your host doesn't offer to use these more personal
names. Most Korean wives retain their maiden names.
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Speak slowly and clearly but not so slow as to be offensive, as
your host may not be fluent in English. Most Koreans understand written English
better than spoken English. Use written materials and graphics, whenever
possible have these materials translated into Korean. This shows respect for the
country and the culture and improves comprehension of the points you are trying
to make. If your business is technical it is best to hire an interpreter to help
you. Keep in mind in using an interpreter that using your own is usually better
than one supplied to you by your host.
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Although Koreans appear quite westernized it is important to
remember that they hold Korean values that are different in certain respects.
Kibun, which relates to a person’s mood or state of mind, affects all
relationships. To hurt someone’s Kibun causes a loss of dignity. Maintaining
harmony is more important than absolute truth.
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Koreans will smile in a variety of situations such as when they
are happy, sad, nervous or embarrassed. Don't necessarily assume that a smile
denotes acceptance. In certain circumstances it can have many meainings. The
Korean sense of humor is often very direct.
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Public perception and image matter a great deal to Koreans.
Representatives of large companies are usually better received initially than
those of smaller less well-known companies.
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Try to obtain a formal introduction to make a business contact
with Koreans. Korea is a relatively small country and relationships are
instrumental in many parts of Korean life. Koreans value introductions and
referrals from people they know. Use acquaintances, suppliers, accountants,
lawyers or consultants to gain these introductions.
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When seeking an introduction to a large Korean firm, see if it has
a subsidiary where your company also has an office. If your subsidiary has dealt
with the other firm or managers in the two firms know each other, this can serve
as the means to introduce you to your target customer.
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It is always very helpful to have a local partner.
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Agents should be approved by the Korean government.
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Cold calls and letters usually do not work.
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Schedule meetings with Korean companies before arriving in the
country, do not expect to arrive in Korea and then be able to meet with them.
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Before choosing a local partner, research the market extensively
to make sure you choose your local partner based on full information. It is
advisable to establish relations with several firms in case partnerships break
down.
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It is best to assign one person to represent your firm on a
permanent basis. This allows personal relationships to develop which are
critical for business success. This person can verify that work is getting
completed. Frequent visits will assure the Korean business that you are
committed to them.
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The Korean Trade Promotion Corporation (KOTRA) publishes a guide
that provides an overview of business information.
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Most South Koreans choose to hold a first meeting in their office.
Punctuality is very important. Shaking hands is a common greeting with both men
and women; it may be accompanied with a slight nod or bow.
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The exchanging of business cards is very ritualized and important
part of a first meeting. The business card should be presented and received with
both hands, with the writing facing the receiver. Show respect by reading the
card slowly and placing it on the table in front of you. If possible have your
cards printed in Korean on one side.
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Begin a first meeting with casual conversation about your trip. Do
no try to accomplish too much at this first meeting. Koreans need to feel you
out and get a sense of your intentions, trustworthiness and objectives.
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Koreans will try to match you with someone of similar rank. Keep
this in mind when selecting a representative as it can be very important.
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Gifts are not required for early meetings. If you have established
a relationship through writing or on the telephone, you may want to bring a
small token such as a pen or a gift with the company logo. If you meet with a
group, bring a gift for the senior person as well as all the subordinates. The
senior person’s gift should be different and more expensive than the others. If
you receive a gift do not open it in front of the giver.
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When invitations for a meal are extended to you, please try to
accept them. You can reciprocate it within a reasonable amount of time during
your next visit.
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Dinner is the largest meal of the day, and usually takes place
between 7:00 and 9:00 p.m. Entertaining frequently takes place in
restaurants/bars. If you are invited to a home, consider it a tremendous honor.
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While it is common in other countries to extend dinner
invitations to spouses, this is not the case when interacting with South
Koreans. Business entertaining is reserved for the parties directly involved
in the negotiations.
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The person who extends the invitation is expected to pay for the
meal. Regardless, a good-natured argument over who will pay is to be expected.
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It is important to remove your shoes when entering a home,
traditional restaurant with floor seating or temple. Eating, sitting, and
sleeping are done on the floor, so this area has to remain clean. Position your
shoes so that the toes are pointing away from the building. When putting your
shoes back on, do not sit with your back toward the temple. If you are a guest
in a home, put on house slippers if your host offers them.
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When you are invited to a home, wandering around and looking into
rooms such as the kitchen will not be appreciated. Entertaining will be confined
to a few select areas.
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Eating at a low table, sitting on soft cushions set on the floor
is common in Korean homes and restaurants. Men traditionally sit cross-legged;
women sit with knees bent and legs together, to one side. If you begin to feel
uncomfortable, stretch your legs straight in front of you under the table.
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The best seat--usually the center seat facing the door-- should
always be offered to the most senior person present in the room.
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Sometimes, a hostess may not join the party for the meal; she will
be in the kitchen preparing food. Instead, she may join the group at the end of
the evening for singing and drinks.
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The most common South Korean toast you will hear is 'Gun-bae.'
When you raise your glass, be sure to do so with your right hand. To confer
extra respect toward the person being toasted, support your right arm with your
left hand. Be aware that the minute you drain your glass, it is a cue to your
host that you would like a 'refill.'
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Typically, very little is said during meals. South Koreans
generally prefer to concentrate on their food while they are eating and talk
later over coffee/tea after a meal is finished.
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Refrain from discussing business during a meal unless your host
brings it up first.
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Rather than waiting for the host to put food on your plate, you
may serve yourself, if he asks you to. But don't start serving yourself or
eating before the host initiates it.
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Do not put food taken from a serving dish directly into your
mouth. Transfer it to your plate or bowl first.
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Chopsticks are the most commonly used utensils, but you can ask
for forks or knives at restaurants in big cities. You will also be offered a
spoon for eating soups and dishes with noodles.
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Foods of any kind should not be picked up with your fingers. Fruit
is eaten in slices with forks.
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Always use your right hand in passing and receiving items at the
table. If you would like to show added respect for someone, allow your left hand
to support your right arm when offering an item.
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It is polite to refill your neighbor's cup and soy sauce bowl when
empty; expect the others to do the same for you.
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Korean meals include rice and soup, and a lot of side dishes
called 'pan chan.' They accompany entrees free of charge. Be aware that many of
the dishes will be extremely spicy.
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Many Koreans
eat similar meals for breakfast, lunch, and dinner. However, some young people
have started eating a simpler breakfast with coffee and toast, instead of a hot
breakfast with rice and soup.
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Every meal
includes soup, which is normally served hot, and may contain a number of
ingredients, such as fish, bean paste, beef, and bean sprouts.
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Kimchee is
served with every meal, and can be made of different vegetables, such as
cucumber or turnip. But most commonly it is made of Korean cabbage which is
rinsed with salt water and left to ferment overnight. Then spices and herbs are
added, including garlic, red pepper, green onion and ginger. It has a very
distinctive taste, and does grow on you.
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Rice is the
staple of each meal. It will be served with fish, beef, chicken, or pork, which
may be marinated and grilled at your table, then served in slices rolled in
lettuce with rice and a red bean paste.
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Noodles are
very popular, substituting for rice. There are a wide variety of rice, potato,
wheat and flour noodles, sometimes made at home. Ready-to-cook noodles are
easily available in the market.
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Bones and
shells are placed on the table or a spare plate.
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The host
will offer more food several times. If you are hosting a party, offer food at
least three times because some may be shy in accepting at the first invitation.
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When you are
finished eating, place your chopsticks on the table or on the rest. Leaving them
sticking out of rice is discouraged, since this is how offerings are made to
ancestors.
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A service
charge is automatically included in fancy restaurant and hotel bills.
Consequently, tipping is not necessary unless you think that the service has
been exceptional and deserves an additional reward. When this is the case, the
most appropriate tip is 10%.
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Total Gross Domestic product (GDP) for the country is $764.6
billion (2000 est. based on purchasing power parity).
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GDP growth rate is 6.3% (2002 est.).
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Per capita GDP based on purchasing power parity is $19,600 (2002
est.).
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Coal, tungsten, graphite, molybdenum, lead and hydropower
potential.
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Major industries include electronics, automobile production, chemicals,
shipbuilding, steel, textiles, clothing, footwear and food processing.
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The main agricultural products are rice, root crops, barley,
vegetables, fruit; cattle, pigs, chickens, milk, eggs and fish.
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Major exports are electronic products, machinery and equipment,
motor vehicles, steel, ships; textiles, clothing, footwear and fish.
Source
A summary of this information can be found at Business in Korea.
For more information go to:
http://www.business-in-korea.com/korea.htm |
