Improved international relations, government reforms, an expanding economy and increased foreign investment make doing business in Korea a potentially lucrative affair.
Be prepared: Doing business in Korea means that business people will come into increasingly frequent contact with Korean business people and officials. It is imperative that those doing business in Korea learn about areas such business culture, business etiquette, meeting protocol and negotiation techniques in order to maximise the potential of their business trip. In this short guide to doing business in Korea, a few cultural facts and their influence on business culture and etiquette are explored. These are in no way meant to represent a comprehensive summary of tips on doing business in Korea but a highlighting of some important key areas one may encounter.

Local Customs and Business Expectations
In essence local customs and business expectations revolves around the concept of harmonious relationships. If proper behaviour through duty, respect and loyalty are shown in the relationships between a ruler-subject, husband-wife, father-son, brother-brother and friend-friend, society as a whole will function smoothly.
When doing business in Korea it is possible to see how Confucianism affects business practices. Of the less subtle manifestations are an aversion to conflict, maintenance of proper demeanour and the preservation of ‘face’.

Roughly translated as ‘good reputation’, ‘respect’ or ‘honour,’ one must learn the subtleties of the concept and understand the possible impact it could have on your doing business in Korea. There are four categories of face.

  1. where one’s face is lessened through their involvement in an action or deed and it being exposed. The loss of face is not the result of the action, but rather it’s being made public knowledge.
  2. when face is given to others through compliments and respect.
  3. face is developed through experience and age. When one shows wisdom in action by avoiding mistakes their face is increased.
  4. where face is increased through the compliments of others made about you to a third party.
It is critical that you give face, save face and show face when doing business in Korea.

Doing business always involves meeting and greeting people. In Korea, meetings start with the shaking of hands and a slight nod of the head. Be sure not to be overly vigorous when shaking hands as the Korean will interpret this as aggressive. The Korean are not keen on physical contact - especially when doing business. The only circumstance in which it may take place is when a host is guiding a guest. Even then contact will only be made by holding a cuff or sleeve. Be sure not to slap, pat or put your arm around someone’s shoulders.

Body language and movement are both areas you should be conscious of when doing business in Korea. You should always be calm, collected and controlled. Body posture should always be formal and attentive as this shows you have self-control and are worthy of respect.

Shaking or Bowing?
When you meet a Korean person for the first time, don't bow! This is a Japanese custom, not Korean. Korean people shake hands, much like in the West. Although not originally a Korean custom, it is popular and commonly done in Korea now, so give your colleage a smile and shake his or her hand.

Exchanging Business Cards:
Korean are big fans of business cards, so make sure you have some when you come. It is very cheap to have business cards printed in Korea, so if you forget them then you can still have some made here. It is always nice to have cards in both Korean and English (or whatever your mother tongue is), but if you don't it's okay. Korean will want to exchange business cards with you when they meet you. How you treat their business card is a direct extension of the respect you have for that person. You should accept your colleague's business card with both hands between the thumb and forefinger of each hand. Similarly, when giving your card you should present it with both hands holding it in the same manner. Don't take your colleague's card and put it in your pocket or briefcase right away! Instead, study it for a moment (this is a good time to make sure you remember your colleague's name and position) and then either keep holding it, or if sitting set it politely on the table in front of you. Be very careful not to wrinkle it or spill something on it; treat it with respect as you would your colleague. Later, when it is time to go carefully place it in your briefcase or notebook rather than shoving it in your pocket.

Building Relationships
Relationships in Korea are very formal. Remember, when doing business you are representing your company so always keep dealings at a professional level. Never become too informal and avoid humour. This is not because the Korean are humourless but rather jokes may be lost in translation and hence be redundant.
When doing business in Korea establishing a contact to act as an intermediary is important. This brings with it multiple benefits. They can act as a reference, be your interpreter and navigate you through the bureaucracy, legal system and local business networks.

Giving Gift Etiquette
Unlike many countries, the giving of gifts does not carry any negative connotations when doing business in Korea. Gifts should always be exchanged for celebrations, as thanks for assistance and even as a sweetener for future favours. However, it is important not to give gifts in the absence of a good reason or a witness. This may be construed differently. When the Korean want to buy gifts it is not uncommon for them to ask what you would like. Do not be shy to specify something you desire. However, it would be wise to demonstrate an appreciation of Korean culture by asking for items such as ink paintings or tea.

Business gifts are always reciprocated. They are seen as debts that must be repaid. When giving gifts do not give cash. They need to be items of worth or beauty. Do not be too frugal with your choice of gift otherwise you will be seen as an ‘iron rooster’, i.e. getting a good gift out of you is like getting a feather out of an iron rooster.

Meetings and Negotiations
Meetings must be made in advance. Preferably some literature regarding your company should be forwarded to introduce the company. Try and book meetings between April – June and September – October. Avoid all national holidays especially Korean New Year.

Punctuality is vital when doing business in Korea. Ensure you are early as late arrivals are seen as an insult. Meetings should begin with some brief small talk. If this is your first meeting then talk of your experiences in Korea so far. Keep it positive and avoid anything political.

Prior to any meeting always send an agenda. This will allow you to have some control of the flow of the meeting. The Korean approach meetings differently, so rather than beginning with minor or side issues and working your way up to the core issue, reverse this.

The Korean are renowned for being tough negotiators. Their primary aim in negotiations is ‘concessions’. Always bear this in mind when formulating your own strategy. You must be willing to show compromise and ensure their negotiators feel they have gained major concessions.

Make sure you have done your homework before doing business in Korea. The Korean plan meticulously and will know your business and possibly you inside out.

One known strategy for Korean negotiators is to begin negotiations showing humility and deference. This is designed to present themselves as vulnerable and weak. You, the stronger, will be expected to help them through concessions. Above all, be patient and never show anger or frustration. Practise your best ‘poker face’ before negotiating with the Korean, once they see you are uncomfortable they will exploit the weakness. Decisions will take a long time either because there is a lack of urgency, simultaneous negotiations are taking place with competitors or because the decision makers are not confident enough.

Doing Business in Korea
The above few examples of differences in culture, business practices, business etiquette and protocol demonstrate the number of areas where business people can face challenges. Cross cultural understanding is an important tool for any international business person, company or organization to acquire when doing business abroad. Looking forward, doing business in Korea will gain more importance as its potential continues to grow.

Korea Tips | Doing Business
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