Doing Business in Germany
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A major international business hub, the country's location at the heart of Europe means that expats doing business in Germany have instant access to Western Europe as well as the emerging markets of Eastern Europe.
Each year large numbers of established companies extend their operations to Germany and relocate staff there. Budding entrepreneurs also see it as a great place to start their own businesses.
This is also demonstrated by Germany's ranking in the World Bank's Ease of Doing Business Survey. In 2018, Germany ranked 20th out of 190 countries surveyed. It scored particularly well in areas such as getting electricity (5th), resolving insolvency (4th) and enforcing contracts (22nd). However, Germany did fall short in areas such as starting a business (113th).
Understanding the market and the nuances of German business etiquette will be key to an expat's success in their new surroundings.
Mondays to Fridays, 9am to 12pm and 1pm to 5pm.
English is widely spoken and commonly used when it comes to business at the multinational level. However, expats shouldn't automatically assume their associates can speak English. In some parts of Germany, Russian is the second language. Furthermore, for those planning on doing business within smaller companies or municipal authorities it is useful to have some knowledge of German.
Formal and conservative – dark suits and corporate wear for both men and women working in banking, business and finance. In more creative industries like fashion, art and advertising, there is more freedom in what people can wear.
Gift-giving is not a normal part of business culture in Germany. Small gifts like flowers, wine or chocolate should be given if invited into a colleague’s home.
Men and women are regarded as equal in the workplace. Women occupy a large number of senior positions within top companies in Germany.
Business culture in Germany
The business culture in Germany tends to be quite conservative and formal. Punctuality and efficiency are highly regarded in German business circles. Expats will need to understand and incorporate elements of German business culture into their practices if they wish to be successful and make a good impression in the local workplace.
Business culture in Germany is formal and efficiency in the workplace is paramount. Time is money – so Germans get straight down to business and there's little room for small talk.
Business meetings in Germany are formal affairs and first names are rarely used in business relationships. Punctuality and appearance are important, so expats should dress well and arrive at meetings fully prepared and on time. Avoiding humour, especially at first, is a good idea as it can be misconstrued. One should expect to be asked detailed questions and have facts and figures on hand to back up what is being presented.
Although most Germans speak English well, many prefer to speak their own language when it comes to business negotiations. Expats who don't speak German should consider hiring a translator for important meetings.
Handshakes are the customary greeting in professional and social contexts. Business contacts must be addressed by their surname, which is to be preceded by Herr for men and Frau for women. First names are only used when invited to do so by a senior person, and usually once some level of mutual respect has been established.
Expats will also find that Germans are private and maintain a strict separation between their work and home life; so it will take some time to forge more personal relationships with colleagues. At lunch meetings expats should allow the host to start business discussions and shouldn't be surprised if alcohol is served. It's a tradition favoured by many Germans, and declining a drink is often frowned upon. The general rule is to at least order a beer, accompanied by the traditional toast, 'Prost.'
Dos and don’ts of business in Germany
Do arrive well prepared for meetings and ready to answer questions
Don't arrive late to meetings or job interviews. Punctuality is important.
Do dress formally in the workplace. Dark suits and corporate wear are safe options.
Don't assume everyone speaks English. Learn some German before embarking on a business venture or consider using an interpreter for important meetings.
Do maintain eye contact when addressing German colleagues, especially during initial introductions
Don't try to integrate humour into the business environment