September 24, 2014
Cutting through in South Korea
With imports and exports worth $9 billion and $19 billion respectively, the Republic of Korea is Australia’s fourth-largest trading partner. We share tips to help Australian business prepare for opportunities in South Korea.
The Republic of Korea is Australia’s fourth-largest trading partner.
While our imports from South Korea total $9 billion, our exports to South Korea are worth a staggering $19 billion – making this Asian nation of 50 million people Australia’s third-largest goods export market. With the signing of the Australia-Korea Free Trade Agreement expected to cement the relationship further, here’s some tips to help Australian business prepare for opportunities in South Korea.
- Having a basic understanding of Korean culture and business etiquette will encourage better business relationships. One of the most important aspects of Korean society is respect for hierarchy, derived from its strong Confucianist heritage.
- It’s vital you build strong relationships with the people you’re doing business with. Relationships are developed through informal social gatherings that often involve a considerable amount of drinking and eating. Such informal gatherings present both sides with an opportunity to discuss business in more relaxed and friendly surroundings. Koreans often prefer to discuss business over dinner.
- Koreans prefer to have a personal connection with those they are doing business with. It can help if you’re introduced to a prospective business associate through an intermediary – and the higher the social standing of the intermediary, the more successful you’re likely to be at making contact with the right people. Cold calling typically has limited success.
- In Korean businesses, everyone has a distinctive place in the organisational hierarchy. Most Korean business people aren’t comfortable until your position and company name is known. Business cards should be left on the table in front of you for easy reference. When translating your card into Korean, only translate your name and title – keep in mind that many titles have a different meaning in Korean. Avoid using Japanese or Chinese-language business cards.
- Korean business people are recognised internationally as good negotiators. Be prepared to be patient and gentle but firm. Be as dignified as possible and don’t push your position too hard. Be prepared for a ‘price war’ but don’t give in easily, as Koreans are persistent and admire this quality in others.
This article was first published in Business View magazine (May 2014). For more articles and interactivity, download the iPad edition of Business View for free via our new app NAB Think.
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