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Cultural Nuances in Philippine Business: Adapting to Local Business Etiquette and Practices

You may have already decided to establish a business in the Philippines. You’ve read about the advantages of outsourcing to the country and are convinced that it’s a cost-effective and profitable strategy. You have identified a potential office in the business district. However, before you launch your company, you should learn more about the nuances of doing business in the Philippines. Doing so enables you to adapt to the way Filipinos negotiate, conduct meetings, socialize, network, and other practices that pave the way for a smooth transition into the country.

What are the things you should know about when doing business in the Philippines?

What You Should Know During Meetings

Meetings are an important part of negotiations, proposals, implementation, and getting to know your business partners. Doing business in the Philippines means that you have to arrive on time for a meeting. You may have heard about Filipino time wherein most people arrive later than the actual time agreed upon. However, when it comes to business, everyone should be on time for meetings. The representative of a company normally doesn’t make decisions. You would have to wait for their superiors to decide on the terms you discussed with their representative. The consensus of a group is still important before reaching their superiors.

Avoid rushing negotiations because Filipinos want to take a slow and measured approach. They are also inclined to ask about how everyone feels about the process, plans, and other aspects of the negotiation. Expect to end meetings with some socializing. Your Filipino partners will engage in conversation that might include the usual small talk and personal questions.

Relationship-Centered Approach

Filipinos value a strong personal relationship with their business partners. They’re likely to trust someone they know rather than a stranger when they do business dealings and during negotiations. Identifying a third party to introduce you to a potential business partner will move the process along faster. It is common to have face-to-face meetings rather than conversations via email, phone, or video chat as these are considered too impersonal. However, this culture leads to nepotism, which is a common problem in the country.

Keep the following in mind when doing business in the Philippines and whenever you create personal relationships with your Filipino counterparts:

  • Engage in conversations and emanate a personable personality. Stiffness and coldness when dealing with Filipinos might jeopardize your business relationship. The impression you make on your counterparts will either have a positive or negative effect on the negotiations and the final decision they make. In some cases, your relationship with them might overcome any hesitations about the business partnership, regardless of the cost they might incur.
  • Your potential Filipino business partners might ask person questions about you and your family. They will show an eagerness that is different from many Westernized cultures. This might seem too personal for a business setting; however, they expect you to ask them similar questions. This kind of rapport may gain you favors. They might ask you favors in return as well, not just for them but for their friends and family because of your friendship. This might create problems. That’s why it’s important to balance your relationship with them and the laws you must comply with.
  • Networking is a serious endeavor when it comes to doing business in the Philippines. The personal contacts you make, and the ones referred to you are important factors for success in the country. A Filipino deems a friendship with individuals more valuable than a relationship with a company. Changing representatives during a partnership may lead to starting over again to develop a relationship before serious negotiations take place.

Keep these things in mind when looking for a business partner in the Philippines. Implementing these practices enables you to build a local team you can trust and rely on.

Insights into the Culture

Other than a personal relationship with your representatives, you have to be mindful of cultural differences when doing business in the Philippines. Make sure to honor verbal agreements. Reneging on it might ruin your reputation and strain your business partnership. Filipinos tend to avoid saying ‘no’ even when they want to decline. They give an unsure answer or say something like ‘bahala na’ which means leave it to fate or God.

Just like a Filipino’s tendency to avoid saying ‘no’ they also tend to avoid directly disagreeing or refusing. This is so because they want to avoid embarrassing themselves or feeling shameful. Look for non-verbal cues or signs of hesitation when answering questions. Pay attention to possible implied meanings of their statements. Exaggerated claims of success and overpromising might make your Filipino counterparts suspicious of your intentions. Stick to facts and provide feasibility studies, when looking for business partners.

Understanding these cultural nuances when doing business in the Philippines. These insights allow you to create genuine partnerships if you decide to pursue your plans in establishing a business entity in the country.

Finding the Right Business Partner

When doing business in the Philippines, it’s important to find a reliable and trustworthy business partner that has years of industry experience. Manila Bookkeepers might just be the company you’ll want to partner with in establishing a representative office, domestic subsidiary, or branch office.

The management of Manila Bookkeepers has more than two decades of experience in the accounting and finance industry. Their team has the expertise and know-how to guide you through the process of establishing your chosen entity in the country. They can assist you in registering your company so that you can legally start operations. This accounting company in the Philippines has partnered with clients from different countries. They can assist you in navigating the cultural nuances of doing business in the country. Other than registering your company in the country, they can do some of your accounting and bookkeeping tasks. Their team can assist you in reviewing accounting entries. They can prepare financial reports such as a cash flow statement, income sheet, and balance sheet. If you need to do bank reconciliation and process accounts payable and receivable, Manila Bookkeepers can assist you.

You need to comply with local regulations and laws when doing business in the Philippines. Manila Bookkeepers makes sure your company complies with local taxes. Their services cover annual registration tax return, monthly compensation withholding tax, and quarterly and annual income tax returns just to name a few. Visit their website to learn more about the services they provide.

Manila Bookkeepers

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