Current business situation
The Department of Foreign Affairs and Trade (DFAT) provides advice for business travellers and tourists going to Taiwan. This is regularly updated, and should be checked before planning travel.
Business cards – exchanging business cards is very important in Taiwan, so you should have a large supply at all times as several hundred may be required for a short trip.
Correspondence – answer enquiries, proposals, correspondence and invitations as soon as possible, and at the very least, send an acknowledgment stating that an answer will follow shortly.
Punctuality – while traffic conditions in Taipei can cause delays, Taiwanese place importance on punctuality and you should avoid arriving late at appointments.
Gifts – the exchange of gifts is widely practiced in business in Taiwan and gift-giving usually occurs at the end of a meeting or during a meal in honour of your guests. Usually only small gifts are necessary but sometimes gifts offered by the Chinese are quite lavish – beware that a special favour may be expected in return.
Forms of address
Many Taiwanese have an English first name used with a Chinese family name, eg. Henry Wang – when this is the case, the family name is used last, as in Australia. Normally when a Chinese name is written, the family name comes first with the given name following, eg. Mr Tang Jie-Fu would be addressed as Mr Tang.
It is unusual for Taiwan companies to buy anything from someone that they do not know.
Business introductions are vital and ‘cold calling’ is not the appropriate way to start a business relationship in Taiwan.
The ‘classmate network’ is a recurring theme of business in Taiwan as the contacts developed at school or university carry over into later careers.
The quality of your agent or representative’s contacts will often be a more important selling point than the intrinsic marketability of your product.
It is vital to spend time in Taiwan with your representative to clearly explain the product, effectively negotiate terms of business and develop networks in the market.
While understanding Taiwan culture is important, do not lose sight of the Australian characteristics of doing business which differentiate you from other foreign competitors and your Taiwanese customers.
Focus on transaction details as well as cultural factors.
Taiwanese have a reputation for being tough negotiators so it is essential to be well-prepared.
Research the company’s business, markets, financial status and reputation.
Understand current economic conditions and government policies in Taiwan.
Eating and drinking play a major role in doing business in Taiwan.
Dinners with local representatives and customers help to develop networks and give the local agent ‘face’.
Toasting at banquets, and after-dinner activities such as karaoke singing, are common business practices.
When rice wine (shaoshing jiu) is served at a meal, the custom is for individuals to drink only after a toast is made. The glass should be held in the right hand, preferably supported by the left. Returning a toast is standard practice. Common toasts are ‘ganbay’ (empty your glass) and ‘sweiyi’ (as you please).
Seating should be arranged so that the Australian host’s party is alternated with the Taiwanese guests. Ensure that guests are invited to eat when each course is served.
The guest of honour will be expected to make a move to leave the dining table first at the conclusion of the meal.
Setting up in Taiwan
Finding distributors, agents and local representation are an important part of an export strategy for Taiwan. The business environment in Taiwan is very different from Australia or other Western markets. Therefore, Australian companies need strong in-market representation to enable them to understand the idiosyncrasies of the market, marketing and distribution channels, buyer identification, product support and relationships with key government agencies in the market.
In general, most exporters will start by engaging a Taiwanese company to be their agent or distributor. Taiwanese companies importing products need to have an import licence. However, if local agents or distributors do not have import licences, Australian companies can import through an import-export trading company. Australian exporters should confirm with their potential business partners which import approach will be used.
As the business develops, consideration may be given to appointing a full-time employee in the market, most likely a locally-engaged Taiwanese person. If business continues to grow and expand, consideration might then be given to posting an expatriate manager from Australia.
It is particularly important to choose your local partners wisely, as these decisions can make or break your business. Identify and check the bona fides of potential in-market representation. Obtain a number of different opinions and background views on potential partners before making your decision.
The key factor is to ensure you have someone who knows the market very well and can grow your business in Taiwan. Companies should look for in-market representation that has a good 'fit' with the company, business operating style and good alignment in business objectives for the Taiwan market. It is vital that these mutual objectives be understood, agreed and monitored in an ongoing manner.
Ideally, the Taiwanese partner should be in a position to provide a range of possible inputs to the business partnership:
- A physical site (i.e. office, plant, land for development, etc)
- Comprehensive local market knowledge in the area of business activity
- Distribution networks, import license or access to import systems
- Access to raw materials
- Commercial and political connections
For more information on setting up an office in Taiwan, please visit the Commerce Industrial Services Portal at: http://gcis.nat.gov.tw/main/English/index.jsp.
Links and resources
Government, business and trade
Australian Office, Commercial Section – www.austrade.org.tw
Taiwan External Trade Development Council – www.taiwantrade.com.tw
Government Information Office Taiwan – www.gio.gov.tw
Ministry of Economic Affairs – www.moea.gov.tw
Ministry of Foreign Affairs – www.mofa.gov.tw/webapp/mp?mp=6
Small and Medium Enterprise Administration, MOEA – www.moeasmea.gov.tw/
News and media
Taipei Times – www.taipeitimes.com
China Post – www.chinapost.com.tw
Taiwan Economic News – http://cens.com/cens/html/en/news/news_home.html
Taiwan Headlines – www.taiwanheadlines.gov.tw
Please note: this list of websites and resources is not definitive. Inclusion in this list does not imply endorsement by Austrade. The information provided is a guide only.