Doing Business in Chile

Chile

The following sections have been written with a foreigner's perspective of the Chilean business mentality and work environment. It contains cultural tips that many will find useful when doing business here in Chile.

Chile is an incredible country that has a lot of opportunities for business. Its economy is stable, inflation is very low and it is now considered to be one of the best places to invest and do business in all of Latin America. With many free trade agreements having come into effect (USA, Europe, Asia), Chile is on the threshold of a very bright future.

Chile has world class industries in relevant sectors: Copper Mining, Forest products, Fruit, Fishing and Salmon being the leading ones. Chile is also a technologically avid country.

Business Meetings in Chile

Sometimes if you have an appointment and you arrive on time, you will be kept waiting even if the person is not doing anything important. It makes them 'appear' like they are very busy and 'in demand'. The more important you are, the less you have to wait. This concept is not normally the case with reputable companies that have an international ideology.

Most business meetings begin with a handshake (regardless of the gender) especially in first meetings. As the business relationship develops, both parts become more demonstrative which can include the kissing on the cheek with women and sometimes embracing between men. The latter is more normal with close associates.

Business cards are given after the initial handshake. Spend a second or two to 'admire' it as Chileans put a lot of importance on their positions in companies. Chileans use two surnames on business cards - the father's first and then the mother's. When addressing the person, use only the father's surname.

Don't rush immediately into the topic to be discussed. Chileans will normally start with polite social chat and will often ask about your family. They are not being nosey, just showing a general interest in you. It is polite to ask about their family too. Business meetings are often considered as being between two people more than two companies, hence the personal interaction.

If there is time, it is often good to bring up topics like Chilean wine and the natural beauties of Chile. If you can show that you know or have learnt something about Chile, it will be appreciated and will give them the opportunity to feel good about their country.

Avoid business visits in the months of January and February as executives and staff tend to be away on holiday, slowing down general business activities.

Chilean Business Contacts

In Chilean business culture, relationships and "insider" status are much more important than in the English speaking world. 'Pitutos' (your connections) are used a lot to get information or to do deals. If you need a job done, someone usually has 'a friend' that can do what you are asking for.

Getting jobs in Chile is sometimes difficult if you don't know anyone in the company. A 'pituto' is the one that will get your foot in the door. It is common to see relatives of the same family working in a company (unfortunately this also recently includes in the government where relatives seem to be able to find a away into official positions, or where a company the family owns/runs gets a lucrative contract with the govt). Most jobs are not published in the local paper (except with reputable companies) since the 'pituto' concept prevails.

Work Environment in Chile

Spanish is the national language. Middle managers and engineers in large companies generally speak some English, although English speaking is less frequent in medium and small companies. Being able to speak some Spanish will make a considerable difference in your work (and general life) relationships.

It is common that Chilean business people do not answer e-mails, faxes, letters or phone calls promptly. Acknowledging messages is not a common habit and many business people might not respond until there is an opportunity or something definite to answer.

If you ask someone to do something, don't expect them to do it right away even if they say they will. Most things are left until the last moment and sometimes it is good to follow up orders and arrangements to make sure that everything is getting done on time.

Chile has one of the highest rates of working hours in the world, though unfortunately this doesn't convert into higher productivity. A couple of years ago, a law was passed to make the working week 45 hours instead of 48 as before. Since Chileans tend to put things off until the last moment, it usually means they have to work extra hours anyway in order to meet the deadline.

Please note that these are only generalizations as there are many Chileans that do work very hard and are very productive and competitive in comparison to the rest of the world. One of the reasons why the country's economy is so strong is thanks to these hard workers. If only the rest would follow suit!

There is a clearly established hierarchy in companies. The formal 'Usted' (you) is used with those in higher positions. It is not common for higher level executives to associate with the 'common' workers especially outside of work hours. Not only is lot of importance placed on positions in a company and you will notice the same about their professions. Take a look at the business cards and the number of 'engineers' that exist in Chile. There are civil engineers, forestry engineers, fishing engineers, tourism engineers... the list goes on.

Getting a Job in Chile

As mentioned before, the 'pitutos' or contacts are one of the most common ways of getting a job in Chile. If you don't know anyone, one of the best places to start looking for a job is with the Sunday edition of 'El Mercurio'. This newspaper is the main and most respected Newspaper in Chile and Sunday is the BIG edition. Amidst all the jobs that ask for salespeople (which are often called 'ejecutivos' or executives) you can find the odd decent job. Be careful because some unscrupulous companies try to lure professional people into a salesperson role by offering supposed jobs that are related to their profession. They may ask for people with MBA's or a profession like Managers but will get them selling whatever from door to door. The mentality is that these types of people will have good contacts so will be able to sell the product easily. If they don't put the name of their company in the advertisement, be careful.

You may be surprised to find that most CV's need to include a photo and often have a lot more personal information than would be contained in other countries. Even though a law has recently been passed to stop discrimination, in practice it is still common to be asked whether you are married or not and even if you have children. In some cases, though fortunately not often, some companies have even required female applicants to have a pregnancy test.

It is illegal to work in Chile on a tourist visa though many foreigners find temporary work (usually as an English teacher) and leave the country every 90 days. There is the possibility of paying to stay an extra 90 days but most people use that money to go on a weekend trip to Mendoza in Argentina (about 6 or 7 hours by bus) and then return so they can stay another 90 days in Chile.

Being a foreigner in Chile and finding a company that will give you a contract can be difficult unless you are very good at what you do. Like a vicious circle, you need a contract to get the work visa, and companies normally won't give you a contract unless you have the work visa. It CAN be done though they often don't give a contract because more often than not they themselves may not be clear on what the process is about hiring foreigners so they won't go to any unnecessary effort to find out. This is not the case with large or international companies as they normally have their own lawyers to work out what is necessary and their legal obligations.

Chile currently has a Working Holiday visa agreement with New Zealand so if you a New Zealander and you want to work legally in Chile, apply for the visa at the Chilean Embassy in Wellington BEFORE you come. This will give you the right to legally work, study and play in Chile for one year. Australia also has a Work and Holiday agreement (notice the slight change in the name of it) with Chile. Check it out BEFORE you come.

If you are a Chilean over 35 years of age, it is very difficult to find a job here unless you know someone or a incredibly good at what you do.

Chilean Business Dress Code

Appearances are an important part of Chilean life so make sure you dress well.

Dress codes are generally formal and conservative; suit and tie for men and discreet business suit (skirt or trousers) for women. Navy blue suits seem to dominate and men tend to put on their jackets when leaving the office, even if it is just for lunch.

Though dressing well is the norm, more and more companies are adopting the system of wearing casual clothes on Fridays. Business attire becomes less formal in the regions of the country and in certain sectors.

Secretaries and clerks in large companies usually wear uniforms.

Office Hours

The following are the general office hours in Chile:

Monday to Friday 8.30am - 6pm (some companies start at 9am).

Banks are only open to the public from 9am - 2pm.

Lunch breaks are normally 1 hour though can sometimes be up to 2 hours for top level workers. In Santiago and other big urban areas, it is not common to go home for lunch, nor to take a 'siesta'.

It is common practice for office workers to work past their finish time. Those that do, almost never get paid overtime and it is done to appear as though they are committed hard-workers in the eyes of their boss. Sometimes they don't have anything to do but they stay on anyway. In some cases it is even frowned upon if your leave your job at the right time (it is not considered as inefficiency as in some other countries).

Useful General Information

Business strategies are often dominated by short-term considerations. Over-promising and under-delivering are frequent. Arrangements should be carefully checked and double-checked. It pays to call a day or two before you expect something to be ready to make sure it will be.

The local tax (I.V.A) is currently at 19% and is placed on all goods and services. Inquire at better hotels about the possibility of legally avoiding the tax as a foreigner paying with a credit card.

Voltage in Santiago is 220 V. 50 cycle AC single phase, two wires.

Video is NTSC (American System).

The international airport in Santiago is called Arturo Merino Benitez (also known as Pudahuel) and is about 20 kilometers from the city center. It's easy to get a taxi or transfer from the airport to the city center. The new Costanera motorway will allow you to get from the airport to Las Condes in around 20 minutes (outside of rush hours).

If you found this guide about Doing Business in Chile interesting or useful, let others know about it.