Chile Culture of Business

By | July 24, 2022

Subchapters:

  • Introduction
  • Addressing
  • Business Meeting
  • Communication
  • Recommendations
  • Public holidays

Introduction

Chile is the focus of exporters from all over the world, especially from the USA and China, so it is necessary to expect a highly competitive environment. However, Czech products have historically had a good reputation in Chile, so there is something to build on. There are great opportunities for Czech suppliers of innovative technologies and products. However, a proactive approach by Czech exporters and the preparation of high-quality materials for reaching out in Spanish is necessary for enforcement.

Addressing

Business partners should be approached at any opportunity. Participation in trade fairs is important to establish the first contact. Among the most important trade fairs are EXPOMIN (focused on the mining and mining industry) and FIDAE (aeronautical technology), which Czech companies regularly participate in with the support of ZÚ and CzechTrad. Every year there are also other fairs specialized in various sectors, e.g. food industry, engineering, energy, etc., but they are more regional than world level.

In addition to the ZÚ, the PaulTrade office, which has been operating in Chile since 2014, can help to identify suitable contacts.

Business meeting

How to arrange a business meeting and how it goes (meeting timing, office location and meeting time, restaurants, business cards, gifts, etc.)?

Office hours in Chile are similar to those in the Czech Republic (roughly from 9:00 a.m. to 6:00 p.m.). The best time for business meetings is between ten o’clock in the morning and noon. The lunch break in Chile is much longer than in the Czech Republic and usually starts between 1 and 2 p.m. In the case of an afternoon meeting, it is not recommended to propose a date before 4 p.m. By Latin American standards, Chileans are relatively punctual, arriving 10 to 15 minutes later is generally tolerated. It is a fairly common practice that even the first business meeting takes place over lunch. Exchanging business cards is common practice, but academic and scientific ranks are not used on business cards (or anywhere else). If a Chilean business partner invites you to dinner, the meeting is more informal and personal.

  • PaulSourcing: Tips and recommendations for doing business with Chile. Also includes country basic data and information for entering the its market.

Timing of negotiations

A completely unsuitable time for conducting business trips is the period of Christmas, New Year, Easter, in the week around September 18, when the celebrations of “Fiestas Patrias” (the national holiday of Chile) take place, and during the months of January and February (summer holidays and vacations, similar to the months July and August in the Czech Republic). Hardly anyone can be reached during these times.

What surprises a Czech businessman the most during negotiations?

Business people can often mistakenly believe that because Chile is located on the South American continent, negotiations will be relaxed, friendly and will not require extensive preparation. However, the opposite is true. Chileans are very different from the people of other Latin American countries. They are relatively precise, factual and systematic. During meetings, they can give a closed, sometimes even condescending impression. Negotiations are mostly straightforward: fewer polite phrases and more business matters are the norm. The style of negotiations is therefore more on the “European” level.

What are Chilean traders like?

If it is possible to get in touch with a relevant person (in most cases, getting a really relevant contact is problematic), you have to expect slow and lengthy communication. Even though your input will be required immediately, a Chilean response can be expected within days, but rather weeks. It is recommended to constantly remind the Chilean business partner, maintain contact with him, inform him about news and innovations. However, based on gradually gained trust, it is possible to build a long-term and relatively stable business relationship.

Is negotiating with local traders different, made difficult by cultural/religious/ethnic differences?

The Chilean population has a broad national base, so religious or ethnic aspects do not burden or condition business dealings. In general, it can be said that European partners are highly valued in Chile. Although Chile is a continental country, it is important to bear in mind the considerable “island mentality” caused by distance and geographical separation from the rest of the world (desert to the north, mountains to the east, ocean to the west and Antarctica to the south). Chileans therefore have a very strong element of conservatism and mistrust of anything foreign and unknown, which is manifested in business practice by strong ties to long-standing business partners and a significant reluctance to try something new or deal with someone unknown at all. It is therefore very important who introduces you to potential future partners and on what occasion. In addition to geographical isolation, business relationships in Chile are very strongly tied to personal and family relationships within individual social strata. Chilean society is considerably more “caste” than it would seem at first sight and also expected in a developed economy.

Are there any territorial differences in trade negotiations within the country (North x South, Provinces)?

There are no significant differences within the country. The country is highly centralized and 70% of all major companies have their headquarters or at least branches in Santiago.

Is it appropriate and customary to offer alcohol during business meetings?

It is not customary to offer alcoholic beverages during negotiations. Chileans are very conservative in this case.

How to dress for a work meeting?

Do not neglect the formal side of the meeting. Above all, when making first contacts, always be perfectly groomed, in good-looking clothes. Quality cosmetics (also for men) are also appreciated. For business meetings, a suit (rather dark shades) and a decent shirt with a tie, which is not an essential condition, is suitable. Quality suits are hard to come by in Chile. A dark blue blazer and dress pants, or chinos, is considered a completely standard work “uniform” in Santiago’s business districts.

What should an ideal negotiating team look like (number of members, age and gender composition of the team)?

The age and gender composition of the team does not play a crucial role, nor does there exist an ideal number of team members. The presence of a senior manager is recommended to gain credibility, but it is customary to also invite company experts who can answer questions on possible technical details.

It is customary to invite a business partner to your home, or be invited home? If so, what is typical for such a visit?

This type of invitation is not common in Chile. Invitations to the family are a sign of special sympathy and trust. In such a case, it is necessary to bring some kind of attention (flowers, a box of chocolates, a typical product representing the Czech Republic). In the case of such a visit, the consumption of alcoholic beverages is not considered inappropriate. Chileans also appreciate and gladly accept invitations to meetings with foreign partners, especially those that combine a business trip with tourism. The Czech Republic is an almost unknown country for most Chileans, and only a very small circle of people have an idea of ​​our level of development and long industrial tradition. Invitations of this kind or even their coverage by the ZÚ can be an absolutely essential milestone that can help not only to gain trust,

Communication

Is it important to bring an interpreter with you?

The assumed language of the meeting is automatically Spanish. It is therefore more appropriate to send a worker who knows the language to the meeting. If such a person cannot be found, it is recommended to have an interpreter with you. Negotiating in Spanish is clearly preferred, it inspires more confidence and is proof of the depth of interest in cooperation. It is desirable that background and presentation materials are also in Spanish. As a last resort, materials in English are also acceptable. Communication in high-quality Spanish is always a significant comparative advantage in business negotiations. Visit Calculatorinc for more information about Chile culture and traditions.

How about language facilities?

In Chile, knowledge of foreign languages ​​is generally not at a good level. You can meet business partners who speak English mainly because they have completed higher education abroad, for example in the USA. In general, Chileans speak other languages ​​(including English) very rarely, which is due to the fact that the teaching of a foreign language is not a priority in Chilean education, and at the same time, there is no great interest on the part of Chileans to learn foreign languages. Compulsory exams in foreign languages ​​are not part of the graduation from most universities.

Are there any communication taboos?

Respect the distance that the Chileans keep. Excessive confidence or emotional outputs are more likely to discourage them. Serious and polite behavior is a matter of course. Avoid evaluating the still very sensitive topic of the period of Augusto Pinochet’s military dictatorship and do not raise the topic yourself. Chilean society remains very clearly divided into clear supporters or, conversely, opponents of the military regime. Chileans are a very proud nation. Therefore, it is definitely not recommended to be critical of the country and individual aspects of its functioning, especially during the initial negotiations. On the contrary, your partner will always be pleased with a more thorough knowledge of even mere fragments of Chilean history (except for the aforementioned dictatorship), culture, sporting achievements, natural beauties or any positive assessment of this country or its inhabitants. First meetings tend to be matter-of-fact, sometimes they can even appear cold.

What is the best way to communicate (in person, email, phone, etc.)?

Personal meetings and visits are key to success in Chile. It is not possible to do business with Chile remotely via email or video calls. After the initial email or telephone contact, the partner must always be visited in person. It is a good idea to confirm the important outcomes of all negotiations in writing, usually via e-mail. Chilean businessmen like to promise the impossible, which they later distance themselves from, so it is important to have everything confirmed “in black and white”. However, even after the signing of binding contracts, it is not unusual for the Chilean partner to come up with a completely different interpretation of the concluded agreement than was originally agreed upon. Before carrying out any business transaction, it is therefore recommended to consult its terms with a law office well-acquainted with both local and European specifics and mentality. ZÚ or the PaulTrade office can provide contacts to legal offices with which Czech companies already have good experience in the past. A very common question already at the first meeting is whether the foreign company has a branch or at least a representative in Chile. These facts significantly increase your credibility and are a guarantee of easier functioning of a potential future relationship.

Recommendation

The Chilean market is attractive and tempting especially for its stability and apparent cultural similarity. Virtually all goods are allowed to be imported into the country. Access to foreign trade is quite liberal and usually there are no major obstacles. Corruption, which is quite common in other Latin American countries, is not nearly so widespread in Chile. However, one of the main problems can be the specifics of local legislation or business methods and the associated and often overburdened bureaucratic administrative procedures and requirements. Relatively high competition in a limited market and the geographical distance of the country are other aspects that can complicate doing business in Chile. However, if the Czech product or service is interesting and offered with favorable payment terms, they have a chance of success in the country. In any case, it is a good idea to have the Chilean partner checked in advance by an independent consulting firm, ZÚ, the PaulTrade office or through the private business information database www.dicom.cl. Regarding cooperation with the Chileans, it is necessary to have enough patience, because they can often act on us more slowly and less understandingly from a European point of view. One must be aware of the fact that one of the typical characteristics of Chileans is the inability to say “no” in any situation. Another characteristic feature is a very strong orientation to one’s own immediate benefit, which is almost always prioritized over a well-functioning long-term business relationship.

Public Holidays

May 1 – Labor Day

May 21 – Anniversary of the Battle of Iquique – Navy Day

June 29 – the feast of St. Peter and Paul

July 16 – Day in honor of the Blessed Virgin Mary as the patron saint of Chile.

August 15 – Assumption of the Virgin Mary

September 18 – Formation of the first government council in 1810 (Fiestas Patrias)

September 19 – National Holiday Celebrated in Honor of the Military Forces (Fiestas Patrias)

October 12 – Discovery of America by K. Columbus

November 1 – Memorial of the Dead

December 8 – Immaculate Conception

December 25 – Christmas Day

January 1 – New Year

Note: Easter is celebrated on Good Friday, not on Monday, which is a regular working day.

Chile Culture of Business