Doing Business in Chile
Expats looking to do business in Chile will find that it's one of the least bureaucratic states in South America. The country is among the best-managed economies in the region and is known for being open to foreign investment.
Many international companies have looked at Chile as the starting point for expanding their business in South America and have chosen Santiago as the headquarters for their regional operations.
The World Bank’s Ease of Doing Business Survey for 2020 ranked Chile 59th out of 190 countries surveyed, better than Saudi Arabia, Greece and Brazil. The World Bank labels Chile a High-Income Country and shows that it performed reasonably well in terms of the availability of electricity (39th) and dealing with construction permits (41st), although they fell short on getting credit (94th).
It's important to understand business culture when working in Chile; here are some useful facts.
The business day usually runs from 8.30am or 9am to 6pm or 7pm, Monday to Friday, though hours are often extended. There is a one- or two-hour lunch break between 1pm and 3pm. Banking hours are weekdays from 9am to 2pm and expats must plan their time accordingly.
The summer months of January and February are when most people go on holiday. It’s important to keep this in mind when scheduling meetings in Chile as it may be difficult to conduct business during these months.
The language of business in Chile is Spanish, although many executives will also speak English.
Business dress in Chile is formal and conservative. Men should wear a suit and tie for formal business meetings. Women tend to wear business suits and generally avoid wearing bright colours or excessive jewellery.
Gifts are not expected until a relationship is formed and are not usually exchanged at a first meeting. If invited to a Chilean’s house, flowers, wine or chocolates are appropriate. Gifts are normally opened straight away.
Women have made strides in achieving gender equality in Chilean business and politics, more so than in many South American countries. However, there is still an element of machismo evident in the business culture.
A firm handshake and direct eye contact are appropriate when greeting Chilean business associates. Expats should use a person’s title and last name when greeting them. If unfamiliar with their title, it's best to use "Señor" or "Señora".
When exchanged, business people should take a moment to look at a business card rather than simply pocketing it.
Business culture in Chile
Chile has a well-educated population with a high literacy rate. As such, expats doing business in Chile will likely be working with highly qualified individuals, many of whom would have been educated abroad, travel internationally and can speak English.
Business culture in Chile is formal and conservative. Appearance is important, as are status and respect. Business structures are hierarchical and decisions are made at the top, so it’s helpful to hold meetings with top-level executives first. When speaking Spanish, formal language and pronouns should be used when addressing colleagues and superiors.
It often takes time to get down to business and start working, so Chileans have been known to extend their work hours. Expats should also be patient if they ask for something to be done and when waiting for email responses – it may be better to discuss certain things in person.
Chileans prefer to conduct business face to face and build long-lasting trustworthy personal relationships. Meetings will often start with polite social talk, asking about an associate’s personal life and family. Business is done between people rather than companies and, as such, concluding business in Chile could take some time. Expats should exercise patience and be prepared to invest time in building business relationships.
Because building relationships is so important in Chile, it can be beneficial to have a pituto, a network or a connection. Pitutos can help people get connected with others and share information.
Dos and don’ts of business in Chile
- Do be on time for meetings
- Do attempt to build personal relationships and be prepared for small talk before getting down to business with Chilean associates
- Do maintain eye contact when conversing with Chilean business associates
- Do always greet the most senior person first
- Don't talk about politics or human rights during business meetings
- Don't be offended if interrupted while talking in meetings; this is not considered rude but rather shows enthusiasm and interest in the conversation
- Don't use too many hand gestures when speaking to Chilean associates as many may be considered rude. In particular, don’t hit the left palm with the right fist, as this is considered an offensive gesture in Chile.