The document discusses several key cultural considerations for foreign companies doing business in China: 1) China has a high power distance culture where hierarchy is respected and decisions are made through superiors rather than individually. 2) Contracts are viewed differently, as flexible documents that can evolve based on changing circumstances rather than rigid agreements as in the US. 3) China has a high-context culture where important information is implied rather than explicitly stated in communications, unlike the low-context culture of the US. The document concludes that while the cultural differences will require adjustments to strategies and approaches, it will not negatively impact the company's overall plans for expanding to China. Understanding and respecting Chinese business culture will be important

1. Response 1:
There are always cultural considerations to consider when a
company decides to enter a foreign market place. It becomes a
question of not if a misunderstanding between two different
cultures will happen but when. This can include minor mishaps
during meetings because of a language barrier to having to pay-
off lower level officials to operate in a country with low ethical
enforcements policies. As a foreign company looking to expand
to China, we must acknowledge and try to understand the
customs of doing business in China. This will help our team
better minimize any common mishaps that can take place and
give us a better opportunity to deal with a company whose
ethical regulations may not be what we are used to back in the
U.S. We will look into three cultural differences foreign
companies will face when doing business with the Chinese, will
this negatively impact our current strategy, and does this
ultimately change our approach.
One cross cultural difference between our company, from
America, and China that will be easily seen in day to day
activities is what Davies refers to as “power distance.”
Countries with a high power-distance recognize and respect
hierarchy. In these societies, a person will consult with their
superiors instead of making decisions. In a low power-distance,
societies tend to believe that all people are equal and deserve
equal rights and opportunities (Davies, 2016).
Contracts are seen differently in China than the U.S. In the
U.S., contracts as viewed to be written in stone, meaning that
the contractual agreement is protected and locks in the agreed
obligations. While in China, they acknowledge that

2. circumstances can and will change throughout the course of a
contract, and as such these contract will need to evolve and be
modified accordingly to benefit both parties (Woods, 2016). The
Chinese focus more on relationship between partnering
business, because they feel if the relationship is strong then
contracts can be renegotiated to benefit both companies.
Davies refers to the elements of the language-context
dichotomy, which was developed by Edward Hall, as an area for
cultural consideration. Hall determined that there was low-
context language and high-context language. The U.S. is
considered a low-context language because we tend to try and
cover every imaginable aspect when communicating and
negotiating that can result in voluminous agreement documents
(Davies, 2016). While China is a high-context language society
where they omit information that they deem to be already
known by the other party. The Chinese prefer brief agreement
documents to that of the voluminous documents of western
businesses (Davies, 2016).
The above cultural considerations listed will not negatively
impact our current strategy but it will change our approach in
the way we do business and most importantly build relationship
with the Chinese. We already have a current handbook which
outlines our current policies and procedures in the way we do
business. For our overseas operations we will have to make a
few adjustments and build upon our current handbook that
acknowledge and work with the Chinese culture. We must
understand their way of business and when “In Rome” do our
best to respect their culture to build healthy and prosperous
relationships in China.
Response 2:

3. As mentioned in MUSE, one of the key tools to overcome the
contrasts between cultures is to keep communication open and
to fully appreciate the other culture. Find out what is important
to the new group, how they communicate, and how they show
their connection to those values.
Our business will need to adapt its products to meet the local
needs of its new customer base. For instance, what is considered
high end quality with a matching price tag in the US may be
astronomical to only the upper class in China. What is
considered low priced and readily available to all in the US may
be “Western Styled” and appeal to the middle class of China’s
population. Another issue found while expanding to China is
the marketing scheme. Our US market has been successful
thanks to our online catalog but many may not have readily
available access or only marketed through blogging and social
media. This will be another adaptation to fully take advantage
of the move to China. Our production in America has grown
and manufacturers of our brand have grown. Suppliers for raw
materials are readily available as well. We are fortunate that
we have a supplier already stationed in China but its
distribution capabilities are not fully known. High import taxes
and a questionable distribution infrastructure, due to
undeveloped roads, dependency on public transportation, and a
market already being used by competitors, will require careful
planning and adapting to the needs and opportunities found in
China. In addition, the differences in values can be quite
massive. Gender equality and roles can become an issue where
women may not be given the same rights as their male
counterparts. Not only will this affect decision making for the
customer base but also about work safety for potential female
employees. Marketing strategies would need to be altered based
on the values of our Chinese customers. What may be
considered normal or mundane may be seen as an insult to
others. In the US, the individual is seen as more important as

4. the whole but that cannot be taken for granted globally. It is
important we research and learn the delicate nuances of the
places we plan to expand our business into. (Thompson, 2018)
The current strategy focuses on high quality products with a
high-end price tag. We will need to make decisions about the
future of the company. Rather we hold ground and focus highly
on the upper-class elite of China’s population or create a new
brand that is focused on producing good quality products for
the, comparatively, lower income households. Our marketing
scheme will need a revamp. Currently, the US has a strong
brand recognition and attributes our brand to high quality. We
cannot depend on this treatment in China. The marketing team
will need to research (based on the direction taken by leadership
on the target customer base) how to effectively and cost
effectively reach those customers. Also, we will need a
dependable strategy that can dependably bring in raw materials.
If we focus heavily on the production facilities of the textile
industry we already have in play, we take the risk of confining
our manufacturing facilities to those close to the textile
production. This also will limit customer access to those who
can reach the textile company and, by extension, us.
My approach would mirror the decisions of leadership, but, I
would suggest a joint venture with a lower cost of goods, high
quality, lower price tag model. Our company name will not be
affected, we can reach a larger demographic, and we can benefit
from the wisdom and cultural experience of a company already
based in China.