Forget About Compromises With Russian Business Partners. They Perceive Them as Weakness.

Many countries against which Russia has imposed sanctions have registered reduced interest in imports of Russian products. But despite the decline, the Russian market is still important for investors in these countries, mainly due to its size and long traditions of bilateral trade. What is the best way to deal with this complicated trade situation?

In the Czech Republic for example, By the end of 2014 Czech exports to Russia had declined to $5 billion p.a., after many successful preceding years. However, that still is not an insignificant amount. In some cases, countries applying sanctions against Russia are making use of the option of re-exports via third countries, which will contribute to future stabilization. Additional strategies to continue trading successfully in spite of current circumstances may be developed by understanding certain basic principles of Russian business management and etiquette.

Business principles

Major competition can be expected in the Russian market, along with trade conducted based on personal ties. The conservative nature of Russian society means that it can take a relatively long time to gain the trust of Russian partners. It makes sense to prepare for this cultural fact by maintaining a consistent team of individuals to negotiate with Russian partners.

Other factors that should not be overlooked are the level of bureaucracy and any necessary resolution of disputes via courts, during which the Russian side often takes an aggressively tactical position. In the case of foreign (Western) investors, this often is related to the perception that foreigners possess greater wealth and will have no problem paying extra, especially in complaint resolution, during which Russians can present an adamant and unyielding attitude.

Therefore, it becomes essential to focus on preventing problems by ensuring that everything is specified contractually with the written understanding that any problems that arise will be discussed in detail. Verbal agreements should never be relied on. Russian partners may promise a lot, but in the end adopt a tough and uncompromising attitude.

This bullishness is also apparent in their business hierarchy and directive approach to management. Negotiations are always conducted formally, and informal behavior can be perceived as a lack of respect. For example, it is not customary to make decisions during a meeting, so it is a good idea to adapt to this situation and anticipate it, remembering also that the outcome will most likely be decided by individuals or a small group of people in the company.

VKontakte dominates among social networks, with LinkedIn and Facebook also popular, but most Russians prefer to use the Russian language for personal communication. English is not a problem in big corporations, but when dealing with small companies it is difficult to get by with English alone. The situation is the same for communication with authorities, so it is often wise to hire an interpreter.

Punctuality is among the standards expected for meetings, but in large cities lateness is relatively common due to the traffic situation, and everyone is basically used to this.

Communication principles

Russians are traditionally known for their patriotism and they resent foreign criticism of situations in their country. It is never a good idea to make jokes about conditions or to insult anything Russian, unless they do so first, and then you may follow suit, but only very carefully.

Russians are generally friendly towards foreigners and can also be quite courteous. They enjoy introducing their culture to others, so this can be an effective path for conversation. Open, honest people are appreciated, and this is doubly true in business. They know how to be very tough, and they view compromises as a sign of weakness, yet they expect business partners to be patient and able to negotiate. Therefore, do not allow yourself to be intimidated or made nervous.

Russians prefer an ornate style of expression that includes exaggeration, lengthy discussion and argument. Eye contact plays an important role during meetings. Failure to use it can give an impression of insecurity or even suggest that information is being withheld. Handshakes are also a basic expectation. However, women should be greeted only verbally, except during large formal meetings. Russians are generally kind and courteous towards women even though in their country gender equality is lacking. It is also true that treatment of seniors is respectful but not entirely equal, and these points should be kept in mind when assembling negotiation teams.

Both in their regular lives and in their business relationships, Russians like to show off their status by wearing brand-name attire, and they also evaluate their counterparts based on how they dress. They often opt for elegant, expensive clothing, which they consider an expression of trustworthiness. If you want your Russian business partners to consider you equal to them, then you should adjust your wardrobe accordingly.

It is customary to give business partners small gifts as a sign of appreciation. In general, only someone with whom you have already developed a basic relationship should be given gifts, and it is important to choose something that is not expensive enough to appear to be a bribe. Careful selection and originality is often appreciated and shows that you made your selection following thoughtful consideration. Gifts that will be appreciated include, for example, Czech glass products or other typical Czech products, which have aesthetics that resemble the Russian style.

VOCABULARY

Good morning/Good evening – Доброе утро/Добрый вечер How are you? – Как дела? My name is … – Меня зовут ... I work for … – Я работаю на ... I'm from the Czech Republic – Я из Чехии I'm here on a business trip – Я приехал в командировку It's nice to meet you – Очень приятно! Excuse me – Мне жаль, Я извиняюсь Thank you – Cпасибо Goodbye – До свидания! Have a nice day – Хорошего дня! One coffee, please – Один кофе, пожалуйста How much does it cost? – Сколько это стоит?

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