Situated in the middle of China's eastern coastline, Shanghai sits at the mouth of the Yangtze River at the heart of the Yangtze River Delta. Shanghai is China's economic center, an important industrial base, as well as its largest port. Finance, insurance, domestic and international trade, and other services are concentrated here. Various businesses are well-developed and competition is stiff.

Because of Shanghai's history as an immigrant city with strong foreign influence, it has developed a unique culture that combines West with East. This mix has given Shanghainese certain tendencies and characteristics, often called haipai, or Shanghai style.

Because they are more familiar with Westerners than Chinese in other parts of China, Shanghainese tend to treat Westerners more equally, thus allowing Western businesspeople to cooperate more easily with the Shanghainese. Shanghainese also tend to adopt Western ways of business and conform to international standards.
For instance, most people agree that the rule of law is stronger in Shanghai than in most other parts of China, as, historically, most residents were immigrants and could not rely on traditional social structures for support; everyone had to follow common rules to make a living. Thus, contracts tend to be honored more often in Shanghai than in other parts of China.

Because of Shanghai's comparatively mobile population, Shanghainese are inclined to maintain good relationships with social contacts over the short term and keep the level of socialization relatively shallow. Unlike Beijingers, who tend to forge friendships with business partners and sometimes take risks for their friends, Shanghainese seldom mix emotions with business. Shanghainese tend to accept renqing (interpersonal harmony)reluctantly, return renqing quickly, and exchange favors of equal value.
Shanghainese also tend to focus on economic interests, value individualism, and emphasize practicality by ignoring politics and showing concern for individual interests. In Shanghai, as long as money can be made, strangers can quickly form bonds.

Finally, Shanghainese have a reputation for knowing how to obtain and protect personal rights and interests. In Shanghai markets, it is not unusual to see a well-dressed gentleman arguing with a vegetable seller for a few cents. In business negotiations, Shanghainese are generally professional, discreet, and attentive to minute details. Therefore, negotiations with Shanghainese over even minor issues may be lengthy. Canny Shanghai businesspeople tend to avoid taking big risks and prefer steady and stable business.