How can the Chinese New Year affect your business?
The Chinese New Year (or Spring Festival as it is called in the modern China) is the most important holiday not just in mainland China but also in Hong Kong and Taiwan. The Chinese New Year starts with the new moon of the first lunar month, between 21 January and 20 February. In 2017 the first day of the Chinese New Year is 28 January, initiating the year of the rooster.
Celebrating the Chinese New Year
Unlike Westerners, the Chinese have a celebration that lasts for about 20 days. Students have a one month winter holiday, while employees have seven days off from work. Business is usually resumed on the 8th day of the festival.
What does this mean for business in and with China?
During the Chinese New Year celebrations, business simply stops in China. Literally. This may have an effect on your business if you have a Chinese partner.
- All banks are closed, so no payment can be processed during this week. If you are doing business with Chinese partners, keep in mind that your company’s payment process and cash flow may be affected.
- Most Chinese businesses, offices, post offices, shops, even production facilities and factories are also closed for the holidays, so if you have an issue to settle, arrange it early January.
- Shipping and logistics also run with limited capacity, so manage your orders in time to minimize the impact on your supply chain and avoid delays. In case you have an order on some online sales site from China, prepare yourself for a little delay.
- Since all commercial activity stops in the country, do not forget that the Chinese and the Hong Kong stock market is also closed for a week.
- The beginning of February is not the best time to go on a holiday or a business trip to China, unless you want to stroll around on the empty streets. If you really have to go, prepare extremely well, especially with booking tickets and accommodation. Why?
Travelling around the Chinese New Year
China is simply huge, and people often have relatives in distant parts of the country. They will want to visit their family, and, most importantly, eat the reunion dinner on New Year’s Eve. Then, over the following days, they will set out to go home. This massive amount people on the go results in the biggest migration on the planet every year.
Starting the New Business Year in China
After such a long holiday, you are not supposed to rush your Chinese business partner. It takes some time to get back to business as usual. So, as a final advice to avoid negative effects of the Chinese New Year celebrations on your company: plan ahead, and settle anything urgent well before the Spring Festival!
We wish you all the best in the year of the rooster!
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