Business cultures from around the world
Whether your startup already operates overseas or you’re thinking about expanding internationally, understanding cultural differences in business will set you up for global success
What does success look like for your startup? Chances are, when mapping out how you want your business to develop, trading overseas features somewhere in your list of ultimate goals.
While there are a number of aspects you’ll have to consider to make your global business dreams a reality — such as finding an export partner, ensuring you meet customs regulations, and understanding how to trade in multiple currencies — it’s likely you’ll also need to learn how to operate a business in an international context.
But how do companies conduct business internationally? What etiquette do you need to know for working in different countries around the world? What are the challenges and opportunities available in each location? And what should entrepreneurs wanting to do business in the UK know about how business is conducted in Britain?
We’ll provide the information you need to help you navigate cultural differences in business. Plus, we’ll share real-life insights and stories from other small businesses.
In this article, we’ll explore:
How to do business in the UK
When meeting clients or other new people, you’re likely to shake hands first. If you’ve got a meeting set up, it’s probably going to run to the predetermined agenda and times. And when we think of business hours, work mostly falls within a 9-5 timeframe on weekdays.
While you may think all of the above are fairly standard business practices, it’s worth noting that this is when viewing business from a distinctly British perspective.
When you start crossing time zones and international borders, it’s not just the landscapes and languages that change. We’ll work our way around the globe, highlighting the key similarities and differences you’ll need to know if you want to do business in different regions.
How to do business in Europe
Looking further afield across the continent, although it may be close to the UK, the rest of Europe does have some differences when it comes to corporate interactions. So, what do you need to know about doing business there?
When talking about communications, it seems suitable to focus on languages first. Many Europeans know a number of languages, and it may be possible to do business in English (to some extent) in certain countries, such as Germany, the Netherlands, and Sweden. However, this isn’t necessarily the case elsewhere: some countries, like Spain, may be more inclined to conduct business in the local language.
Across Eastern Europe, there’s a preference for in-person communication, and for meetings to run on time.
When doing business in countries that transcend continents – such as Russia and Turkey – it’s important to be aware of the multiple cultural differences that are at play within each country, with influences from both Europe and Asia.
For example, in Russia, being on time for meetings is especially important, as is respecting the most senior people. Similarly, in Turkey, business meetings are usually set in advance and expected to run on time.
And remember: if socialising with your Turkish business associates, be sure to find out if they do or don’t drink alcohol.
If you want to do business in France, you’ll need to know when – and when not – to ‘faire la bise’. While the air kissing practice is a way of life in France socially, a handshake is a more acceptable business greeting.
Formality is key – ensure you use the correct titles when speaking with people, and maintain proper manners if invited out to a business lunch or dinner.
In Germany, meanwhile, the focus is more on planning, with Germans wanting attention to detail and forward planning in business interactions.
Doing business in America
New York City, Los Angeles, San Francisco – some of the most important business hubs in the world are in the US. But what’s it really like for entrepreneurs who dream of doing business there?
Americans are well known for being direct, often loud communicators – and in a business context, this is no different. You can expect friendly, informal interactions when dealing with people there, regardless of their seniority. Conversations may often be peppered with sports terms, while silence is perceived negatively and often avoided.
‘Time is money’ is the general principle which underlines much of American business practice. The financial impact of decisions and work is often given high priority, and so business tasks are made as efficient as possible in order not to waste resources.
While across the pond in the UK (and elsewhere), it’s looked upon favourably to be modest and humble about your business and achievements, in the US it can be quite the opposite. In fact, it’s often expected that you will speak highly about your own skills – if you’re good at something, then say so!
While the country singer Dolly Parton may have famously sung about working nine to five, her lyrics don’t necessarily ring true for the rest of the US.
When doing business in America, it’s important to remember that your American counterparts will tend to work long days. It’s common for them to work in the evenings, on weekends, or over their (limited) vacation time, in addition to the standard full day in the office.
However, remember that America is a huge country, and that circumstances can differ across its many states. Plus, while American culture may seem familiar thanks to the media, there are still many nuances that you’re likely to be unaware of until you are ‘on the ground’.
Natalie Meyer, founder and CEO at Tokyoesque, says the following about business cultures:
“I’ve learnt to treat business culture as a sliding scale. Some cultures are more familiar, while some are more formal; some are more punctual, while some are less so.
“For example, in terms of directness, Americans often straight up ask for what they want. In the UK, this is less common, and it’s more important to have the chit-chat and geniality. In Japan, you might not ask at all – you’d focus on very carefully cultivating a relationship with that person.
“On the other hand, I’ve also learnt that you can occasionally leverage your outsider status to your advantage. For example, sometimes it works to be extremely direct in both the UK and Japan, but you have to know what you’re doing – and respect the way it’s usually done!
“This is why I believe it’s so important to do your cultural research before entering a market. If you don’t know what rules (if any) you are breaking, it is difficult to succeed.”
Doing business internationally: The local lowdown
Meyer: “My experiences that stand out usually involve the mixing of two cultures.
“For example, in 2017, I brought Japanese clients to the Edinburgh Fringe festival. We wanted to investigate how big cultural events are organised, in preparation for the Tokyo 2020 Olympics.
“Observing something as British as the Fringe while speaking only in Japanese – as well as the extra formality, and the care with which we investigated every nook and cranny of Edinburgh – made me view the UK in a different light.”
Doing business in Asia
With business cultures as diverse and varied as its 48 countries, Asia is an exciting continent to trade in. Here, we delve further into the etiquette and cultural understanding you’ll need if you want your business ventures to be successful there…
One of the most important elements of business communications in Asia centres around the exchanging of business cards.
This should be treated with similar levels of respect and understanding as other business interactions. For example, it’s generally expected that you should take and give business cards with both hands, and be sure to look at and store them carefully.
You’re also likely to come across the concept of ‘saving face’ when doing business in Asia. This is deeply embedded in several Asian cultures, and runs throughout many interactions.
Essentially, saving face is all about people understanding their place in society. It’s about ensuring the smooth running of daily life, while also realising what actions do and don’t adhere to this. For example, highlighting mistakes and errors would be seen as a way of making your associates lose face, as would arguing or raising your voice in public.
Sid Hart, global director of commercial development at Hypaship, advises: “Research is key – getting to the right person can be difficult, but like doing business anywhere, research will be invaluable.
“Also, ‘yes’ doesn't always mean ‘yes’. Many Asian countries have a ‘saving face’ culture, meaning that they will agree and even suggest business will be forthcoming, even when it's not. ‘Yes’ only means ‘yes’ when a contract is signed.
“When dealing with government contracts, make sure you are aware of local buying laws. Countries will often insist that if the product is available locally, their departments must buy locally. However, this can often be overcome by linking up with a good local partner.”
Doing business internationally: The local lowdown
Sal Essa, founder at NO GUNK: “When I first arrived in Shanghai, I had no local renminbi. Luckily, I had a friend over there and I asked him for some help.
“He suggested we go to the bank and we did. When we rock up to the bank, we soon realise that there's a huge queue to change the currency, lots of forms, and I'd need my passport.
“A frail Chinese man, who we previously saw standing outside the bank on a motorbike with a messenger bag, comes up to us. According to my friend who spoke Chinese, he offered us to change the pounds sterling we had, directly! He promised a better rate than the bank and without any of the paperwork!
“At first I thought this was a scam. It sounded like one. Imagine if someone with a bag full of foreign currency offered to do the same at Barclays in the UK? You'd probably be very alarmed.
“However, my friend said he had good guanxi with this man and that he would be able to prove that the money is real. He took us to the ATM booth within the bank, and pulled out the local currency from the ATM. At this point we had a deal – or chéng jiāo (成交) as they say in Mandarin!”
Networking and socialising form a big part of business operations in Asia. This is especially the case in China, where your ‘guanxi’ (network) plays a central role in business operations. So, if you’re wondering ‘how to do business in China’, then be sure to focus on creating and maintaining ‘guanxi’.
This is developed gradually, by spending time with people professionally and socially. In turn, it reinforces the importance of cultivating good relationships with those that you do business with.
Therefore, the need to take meetings in person is crucial in Asia, as is the need to spend time in the country in which you want to operate. While you may decide to dedicate your time to this, it may also be useful to find a local representative for each place you intend to trade in, as they’re likely to have a better understanding of the necessary cultural and business etiquette.
Essa says: “In China, there is a key currency which governs all business done there, which is called ’guanxi' – literally meaning ‘connections’ or ‘relationships’.
“If you have good ‘guanxi‘ with someone, that means they’ll usually help you out in your time of need, and vice versa. To build good ‘guanxi‘, one must be willing to spend lots of face time getting to know your Chinese counterpart. Often this means going out for dinner or drinks together, and even meeting their family and exchanging gifts.
“Speaking Mandarin definitely helps, and that's why I spend a lot of time maintaining the foreign languages that I know. It always makes a difference if you want to be a true international businessperson.”
Also, when working with Asian companies, it’s important to understand that decision-making is often a group process, with senior members of staff having to be consulted before an action or deal is agreed. And, overall, there’s a lot more emphasis placed on the group or the collective, as opposed to the individual.
We asked Hart if there were any myths he wanted to bust about doing business in Asia. He replied:
“[It’s a myth] that doing business is difficult! It's not – just make sure you have fully understood the opportunity, and that you act with integrity. For Asians on the whole, if you have promised something, you must deliver exactly that.”
In Asia, nights out with your co-workers are common. This is seen as a key part of getting to know the people that you work or do business with.
That being said, there’s still a considerable emphasis placed on respect and formality. Be aware of the hierarchy of the businesses that you’re dealing with, and how they work. Similarly, know if your business associates have particular titles, and understand how to introduce them correctly if needed.
Hart says: “Asia has a more formal way of doing business than the UK. In Asia, if you're the most senior person in the room, then all questions and comments will be addressed to you – even if they're meant for your colleagues. There is no crossover between business and pleasure – when you're meeting, it's for business, and if you're at dinner, it's pleasure. The two don't often meet.”
Doing business internationally: The local lowdown
Hart: “Asians are extremely hospitable, and will go out of their way to make you feel comfortable. They want to show you the best of their countries – sometimes with hilarious consequences. For example, you could be taken to dinner, and allow your host to order – only to find that what you're eating is frog, or worse still, cockroaches.”
For entrepreneurs interested in doing business in Japan, Meyer advises: “First, make sure you do something to prepare yourself – do your research, and investigate what the differences and the opportunities will be for your business there.
“Secondly, go and actually experience it; immerse yourself in the Japanese environment by meeting your consumers and local market firsthand.
“Finally, localise, localise, localise. The combination of research and immersing yourself in the region should enable you to carefully select your localisation and market entry strategy, to balance out your ‘exoticness’ with your suitability for the market.”
And a myth to bust about doing business in Japan? Meyer states: “Many people believe that the Japanese are shy, but this isn’t true. Rather, in Japanese society, there is an expectation that a certain amount of space and consideration be placed around interactions.
“This is rooted in the concept of ‘ma’, or ‘negative space’, which is concerned with the relationships that empty space can create (not only physically). If you are able to respond with the same sense of space and consideration, then a beautiful relationship can be created.
“It is difficult to describe until you have experienced it. You can start by noticing the silences – which may seem common when speaking to someone who is Japanese – and letting them stand for an extra few seconds instead of filling them.”
Sam Lee, VP Sales – APAC, MVF, discusses his experience of doing business internationally, saying: “Thanks to my time at Taboola APAC, I've had the privilege of doing business in South East Asia, primarily in Singapore, Malaysia, Thailand and HK.”
Lee shares what he's learned about the business culture in these locations, commenting: “With a team of 70+ head count speaking 15 languages and travelling every fortnight to different markets, you have to learn to adapt quickly to the needs of the market, without sacrificing on your best practices or making commercial decisions that would materially impact the company's profitability.”
“In Singapore heading out for lunch with your colleagues is the norm. What is also the cultural norm is placing lanyards, packets of tissue paper or business cards as placeholders to ‘reserve' your seats in a food court. I for one found this amusing and have almost been on the receiving end of verbal abuse for not realising this code of conduct.”
Lee offers the following advice: “Fail fast and fail forward. When operating in a new market, it is synonymous to operating as a startup even though you're branching out from a well-established operation i.e. a UK company expanding to APAC. Therefore, it is crucial that those on-board this crusade adopt a founders' mentality, which would oftentimes mean making decisions with 60-70% of the information you need at hand.”
Doing business in Asia Pacific
Further across from the countries discussed above, there’s the Asia Pacific region – a term applied to a number of countries in the area, including many island nations, and sometimes covering the area from Singapore, Japan and Hawaii. So how do these places, which are some of the most remote in the world, do business?
Well, according to the Doing Business 2019 report published by the World Bank Group, New Zealand is the number one country in the world for ease of doing business. And across ‘the ditch’ (the Tasman Sea), New Zealand’s neighbour Australia was ranked 18th in the same list.
Although they may be easy to do business in, it’s worth noting for UK-based entrepreneurs that team members in Australia and New Zealand could be working 10, 11 or even 12 hours ahead of you, so be sure to factor these considerable time differences into your plans.
One of the main elements of doing business in Australia is to be modest, such as when talking about your achievements or other successes. Plus, Australians are known for being friendly and relaxed, yet direct communicators.
This is true of their Kiwi counterparts too, who also have an easy-going attitude. When doing business in New Zealand, it can also be helpful to have an awareness of Māori culture – you shouldn’t sit on tables or pillows, for example.
Doing business in the Middle East
The Middle East is a far-ranging region which includes places in the European, Asian and African continents. So what is it like to do business in this part of the world?
In general, face-to-face meetings are preferred in the Middle East, as this relates to the importance that many societies in this region place on knowing business associates both personally and professionally. However, meetings might not run to time, and it’s not unusual for them to be interrupted.
Body language also plays an important part too – it’s considered offensive to show the soles of your shoes, and avoid using your left hand to gesture or eat with.
Essa advises: “If you're looking to do business in the Middle East or China, invest in building relationships, and learning the local language.
“This way, it's harder to be made a fool out of by unscrupulous people, and ultimately you will need strong relationships to have the local influence to get things done.
“I would also advise people to be patient. Especially in the Middle East, things are slow. Meetings can often start later than expected, while phone calls are sometimes taken during meetings. This should all be part of your calculations when thinking about timescales.
“You cannot change the culture – you must always flow with it.”
One of the main factors to consider when conducting business in the Middle East is that in nearly all of the countries in the area, the weekend is considered to take place on Friday and Saturday. The exceptions to this are Lebanon, Morocco and Tunisia, where the weekend is Saturday and Sunday.
Also, business often moves at a slower pace across the Middle East, and it’s necessary to be patient.
Essa says: “The Middle East tends to be very slow and relationship driven. Someone once told me what takes three weeks to do in the UK can take three months in the Middle East. It's true, I can confirm!
“It's very much about building a relationship first, then talking about business.”
Modest, conservative clothing is expected in the region, and women in particular may need to take into account country-specific rules and customs when doing business in the Middle East.
And a myth that Essa would like to bust?: “That myth that women in the Middle East are oppressed, or not allowed to start their own businesses without their husband or father’s permission.
“Quite the contrary – I've met and done business with some very brave, enterprising women in the region who are breadwinners for their families.”
Doing business in Africa
Home to 1.2 billion people and accounting for 16% of the global population, Africa is the continent which is experiencing the fastest population growth, according to the UN. So what is it like to do business in African countries?
Due to the sheer number of languages and cultures present across Africa, there are likely to be a range of different communication styles. Some of the main languages you’re likely to come across, particularly in a business context include English, French and Portuguese, as well as Arabic and Swahili.
However, showing respect for elders is key in many African societies, as well as showing an interest in people’s families and personal lives (instead of jumping straight into business negotiations).
When it comes to working and operating business transactions day-to-day, note that these processes may be slow and lengthy in some countries.
This isn’t true across the board, however, with Mauritius and Rwanda coming 20th and 29th respectively in the World Bank Group’s Doing Business 2019 report.
If you’re interested in doing business in Kenya, you should be aware of the concept of ‘harambee’, which emphasises the importance of the group and the community; working collaboratively and helping each other out if and when needed.
While entertaining, socialising and food are at the core of many cultures on the African continent, don’t assume that it’s okay to conduct business when you’re invited to a dinner or someone’s home.
For example, if a client in South Africa invites you to a braai (a traditional barbecue over an open fire), see this as a social gathering primarily, rather than as another opportunity to do business.
Doing business in Latin America
In this final section, we once again return to the southern hemisphere, this time looking at what it’s like to do business in Latin America.
With the ‘B’ in BRICS standing for Brazil (an acronym which stands for Brazil, Russia, India, China and South Africa and refers to these emerging economies), it’s clear the world is aware of the business opportunities to be found in South America. But what are the other options, in addition to Brazil, for entrepreneurs seeking countries in South America to work in?
When doing business in Latin America, you should be aware that your counterparts in these countries are likely to be talkative, with a preference for in-person meetings.
In Latin America, physical space boundaries are smaller than you might be used to, and physical contact can often form a major part of greetings. Similarly, Latin Americans are fond of using gestures. However, you should avoid using the ‘ok’ hand sign – in Brazil, it’s considered offensive!
Also, don’t assume that everyone will know English – it’s wise to ensure translation is available. This could be through an interpreter at meetings, or with materials translated into Spanish or Portugese where appropriate.
Across the different countries in Latin America, you can expect slower timeframes, and a more long-term view when it comes to day-to-day business duties.
It’s important to have a realistic view of the size of the continent, as well as some of the individual countries, which can have considerable or challenging terrain – Brazil included.
In turn, each country in Latin America will have their own way of doing things, so a specified approach is likely to be necessary. And lastly, don’t be surprised if cash payments are preferred.
Latin Americans tend to be friendly and sociable. This translates into the working world too, with an emphasis on the importance of personal relationships in a business context.
Meetings can overrun, and have a more relaxed structure. That being said, formal attire is considered important when doing business, so be sure to look the part.
We took off by exploring how business is done in Britain, before jetting around the world to cover the rest of Europe. We then ventured to Asia, Asia Pacific, Africa, America, and Latin America. Now, we’ve arrived at our destination: a better understanding of international business cultures!
And so, what are some of the key takeaways to remember when trying to conduct business overseas? Essentially: research each country individually, be respectful of cultures and traditions, and try to learn – or at least have an awareness of – the local language.
Good luck – or rather, ‘bonne chance’, ‘buena suerte’, and ‘bahati njema’. That’s ‘good luck’ in French, Spanish and Swahili!