Must Know Things About Korean Business Etiquette & Culture

Kristina Temelkova

I am born and raised in Bulgaria, but I'm currently living in Vienna, Austria. Besides content writing, I work as a translator, video editor, and caption writer. At present, I’m also finishing my master’s degree in applied linguistics at the University of Vienna. I speak four languages: Bulgarian, English, German, and Russian.

Jan 31, 2024 | Language, Culture

South Korea has consistently ranked among the top 10 largest economies in the world and the 4th biggest economy in Asia.

Located in Eastern Asia, the country offers a vast array of business opportunities due to its highly developed mixed economy. Its most prominent economic sectors are technology and the automotive industry.

In the dynamic South Korea’s business world, however, success is not just about transactions, deals, and rapid profits.

In fact, Korean business culture is deeply rooted in old traditions and is based on rigid hierarchies and close interpersonal relationships.

In this blog, we offer you a guide to Korean business etiquette and culture.

We’ll start with an overview of the economic landscape and the opportunities and challenges it offers. Then we’ll delve into the cultural nuances that shape Korean business.

Whether you’re an accomplished business professional who simply wants to enhance your cultural understanding or a complete novice who’s preparing to venture into the Korean market, don’t hesitate to join us on this insightful journey through the nuts and bolts of Korean business etiquette and culture!

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Overview of the Korean business market

In the last decades, South Korea has demonstrated exceptional economic growth and resilience, solidifying its position as a major player on the global scene.

South Korea has positioned itself as a leader in the Fourth Industrial Revolution.

With a GDP of approximately $1.67 trillion USD in 2022, the country’s economy is characterized by robust industrial sectors, primarily in the technology and automotive industries.

Established companies, such as Samsung, Hyundai, and LG have played a pivotal role in the country’s economic advancements.

Must Know Things About Korean Business Etiquette & Culture

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Also read: Languages of East Asia [Complete Guide]

The nation has embraced innovation in recent years, which has become a key driver of the Korean economy. Despite challenges such as geopolitical tensions and an aging population, South Korea remains committed to technological progress.

There have been substantial investments in research and development, which in turn have resulted in huge advancements in 5G technology, electric vehicles, and artificial intelligence.

It seems, South Korea is fully dedicated to fostering innovation and ensuring sustainable economic development in the future.

Challenges and opportunities for foreign companies in Korea

While South Korea offers a well-developed economic landscape and numerous business opportunities, entering the Korean market presents some challenges that you might want to be aware of.

Some of the most prominent challenges include:

Navigating Cultural Nuances

For a Westerner, it might be hard to adapt to and understand the complex hierarchical and relationship-oriented Korean business culture.

While in the Western world, business is about ruthlessly conquering new opportunities, in Korea, business boils down to long-term partnerships and commitment.

Values, such as respect, patience, and commitment, are central to business etiquette in the country.

Eliminating the Competition

From an economic perspective, entering the Korean market might be challenging due to established local companies that have overtaken various sectors.

Thus, one needs to do proper market research to be well aware of the opportunities this market offers. As a newcomer, you might want to be more strategic about your business moves.

Thus, get to know the competition and look for any possible niches in the demand you might want to fill.

Must Know Things About Korean Business Etiquette & Culture

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Also read: Everything About The Languages Of APAC

Creating Interpersonal Connections

When doing business in South Korea, building strong local relationships is crucial. Thus, it might take some time before you start discussing a possible business deal with your partner.

As one might expect, the emphasis on interpersonal connections may pose challenges for foreigners who are unfamiliar with Korean business practices.

Nevertheless, the Korean market offers a huge array of opportunities for businesses that want to expand into new territories. Here are some suggestions:

Growing Affluent Consumer Base

One of the biggest advantages of the Korean market is its technologically advanced and affluent consumer base.

Indeed, Korean customers show interest in high-quality products and services, which in turn opens new doors for foreign businesses.

Active Government Support

The South Korean government recognizes the opportunities that foreign startups and global companies offer for economic growth. Hence, it actively encourages foreign investments.

The local authorities offer various incentives, especially for foreign businesses, that are willing to enter the local market.

Must Know Things About Korean Business Etiquette & Culture

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Growing Innovation and Technology Demand

With its tech-savvy population, South Korea offers a market full of opportunities for innovative tech companies.

As you might expect, there is a growing demand for innovative products and services, so if you are a company offering cutting-edge solutions, South Korea might be the right place for you!

Leveraging E-commerce Platforms

 Since 2016, online purchases have surpassed hypermarket sales, making e-commerce platforms the most popular retail channel in Korea.

So if you are just entering the Korean market and want to gain some traction, e-commerce platforms would be an ideal solution for you.

Indeed, leveraging e-commerce platforms provides foreign companies with the means to easily engage with Korean consumers.

Cultural considerations for doing business in Korea

When navigating the business landscape in Korea, you need to pay careful attention to cultural considerations. Here are some points you might want to keep in mind in order to avoid confusion or embarrassment:

Respect the Confucian Principles

Korean business culture is greatly influenced by the so-called Confucian principles.

These are values that focus on and emphasize the significance of hierarchy, respect for authority, and strong interpersonal relationships.

Must Know Things About Korean Business Etiquette & Culture

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Also read: Mistakes Linguists Make in Korean to English Translation

Establish trust in your business partners

Establishing trust is a crucial initial step in any business relationship.

In South Korea, business and trust go hand in hand, so during your initial business meetings, you might want to prioritize rapport-building over immediate discussions of business-related matters.

Avoid direct communication

 Business communication tends to be indirect. In business meetings, people use a lot of non-verbal cues and subtleties with significant meaning.

For a foreigner, this can be unfamiliar, so you need to pay closer attention to the way your partners communicate to avoid any awkward situations.

Exchange business cards

 The exchange of business cards is a very common practice in Korean business spheres.

When exchanging business cards, addressing individuals with their appropriate titles is crucial.

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Mind the “nunchi”

“Nunchi” is a Korean term that refers to “social sensitivity.”.

Understanding and following the principles of nunchi is vital for successfully doing business in Korea.

The concept of nunchi would help you be a better listener while also responding attentively to other people’s moods and reactions.

Must Know Things About Korean Business Etiquette & Culture

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Practice patience and humility

Patience, humility, and a willingness to invest time in relationship-building activities are key components of successful business interactions.

Actively practicing these traits would undoubtedly signal to your partners that you respect them.

Connect with your Korean customers in there native language

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Korean business etiquette and culture

Korean business etiquette includes certain steps that are of paramount importance if you want to make a good impression on your potential business partners.

Formal greetings: Always begin meetings with a formal bow. If the other person offers a handshake, you’re expected to reciprocate the gesture.

Use of the appropriate titles: Always address individuals with their appropriate titles.

In Korea, using honorifics shows respect. In this regard, it’s common to use titles followed by the person’s last name until a more casual relationship is established.

Hierarchy: In Korean companies, decision-making often follows a top-down approach. In other words, authority is crucial, and thus, you should respect the hierarchical structure within organizations.

Korean business etiquette & culture - hierarchy

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Also read: Business In Japan: Cultural Differences You Need To Know

Seating Arrangements: As we mentioned, hierarchy is a crucial part of the business culture in South Korea. This is also evident in the seating arrangements in a business meeting since usually it’s the most senior person that is typically seated first.

Similarly, during meals, always wait for the eldest or most senior person to start eating or drinking.

Respect for Elders: In Korea, age is often associated with wisdom and experience.

Thus, showing respect for elders is deeply ingrained in the local culture as well as business etiquette.

Initial small talk: Business meetings in Korea have a completely different order of events than those in the Western world.

Indeed, meetings may involve initial small talk, which aims to build rapport between all parties involved. Once you get to know your partners a little better, you can delve into business matters.

Exchange of business cards: Exchanging business cards is an essential part of Korean business etiquette.

Note that it’s accepted that you have to present and receive business cards while holding them with both hands. Additionally, take some time to examine the card before putting it away to show respect.

Gift Giving: Gift giving is a common practice in Korean business etiquette and is a sign of respect and goodwill. When presenting a gift, it’s important to use both hands.

Additionally, it’s polite to express reluctance when receiving a gift. And keep in mind that gifts should be opened privately.

Dress Code: Formal attire is to be expected when attending business meetings. Opting for a dark-colored suit would be a safe option for both men and women.

Languages in Korea

The most widely spoken language in Korea is Korean. This is the official language of the country and is used by governmental institutions, education, and the media.

According to the 2021 Census, nearly 90% of the Korean population speaks Korean.

Japanese is another language that can be heard in Korea, but it is mainly spoken by older generations.

Although English is taught in schools from a young age, only a small part of the population (around 10%) can speak English fluently.

Must Know Things About Korean Business Etiquette & Culture

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Also read: What are the Fastest Growing Languages?

What is the business language in Korea?

When it comes to business, the most common language is Korean.

Thus, when scheduling a meeting with potential business partners, it is advisable to check if it can be done in English.

You’re likely going to receive a negative answer.

In such cases, you can always rely on a professional translator who will assist you during your business meetings.

Communication styles in Korean business setting

The communication style in Korea differs from the way Westerners communicate. Thus, it’s important to keep the following points in mind:

Don’t be explicit: Koreans usually prefer implicit communication. This means that they often use subtleties or non-verbal cues to convey a message.

That’s why you should be more attentive to facial expressions and body language.

Must Know Things About Korean Business Etiquette & Culture

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Also read: Chinese vs Japanese vs Korean Languages: Similarities & Differences

Show politeness and respect: Politeness and respect are essential elements of Korean culture.

When it comes to business communication, these are reflected in the appropriate use of titles and formal language, as well as the proper tone of voice when addressing people in higher positions.

Make pauses: Silence and pauses during conversations are very common in Korean communication. They are not meant to be awkward but should give you some time to reflect on what has been said.

Be friendly: Building personal relationships is essential for doing business in Korea. Building trust in your potential business partners and getting to know them more personally will help you establish good rapport.

Be patient and take it slow: Patience is key to successful interactions with your Korean business partners.

For a foreigner, how Koreans communicate might seem slow and complicated. Nevertheless, keep in mind that by following the local customs and etiquette you are being respectful and gradually establishing trust and mutual understanding.

This, in turn, would be greatly beneficial to your future business affairs.

In conclusion…

Korean business etiquette and culture are heavily influenced by local traditions and beliefs. Thus, navigating through the local customs might be challenging for a foreigner.

Nevertheless, you should keep in mind that fostering mutual understanding beyond cultural differences lays the foundation for successful and lasting business relations, especially in South Korea.

Indeed, adapting and openly embracing the local customs and communication style greatly contributes to stable business relationships with your Korean partners.

Are You Looking for professional Korean translation services?

Milestone helps you accurately translate your documents, websites, apps, videos, and more in 70+ languages.

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