14 reasons to do business in Germany
The engine of Europe’s economy
With a gross domestic product of more than 4.029 trillion USD, Germany is a global economic driving force. Germany’s economy is also expected to grow by about 2% in the next two years, with future growth forecast between 0.7% and 1.75% over the next 20 to 50 years. The consistently strong economic performance offers substantial long-term growth potential for businesses from countries such as the UK and the US.
Major domestic market
Germany is the European Union’s most populous country and has a huge domestic market. With nearly 83 million inhabitants, Germany’s consumer market presents major opportunities for foreign companies from all sectors.
Lucrative market for SME
Germany is the home of the SME. While it is known for its industrial giants including BMW and Siemens, approximately 99.6% of all German companies are SMEs. This means that 2.45 million companies provide more than 60% of all jobs in Germany. On this basis, foreign businesses looking to enter the market can be assured that size is no barrier to success, as the German market is particularly supportive of SMEs.
A stepping-stone to succeed and other countries
A foreign business that demonstrates the credentials and persistence to satisfy the testing requirements of the German market can often then use this success as a stepping stone to further expansion abroad, in markets such as the European Union, Russia, Belarus and Turkey. Achieving success in Germany can open doors for foreign businesses to access other growing markets!
High productivity
Germany is one of Europe’s most cost-effective production locations and has one of the highest productivity rates in the world. This is increasing year on year – with productivity rising by more than 30% equal to 4.1 index points in the past 5 years, according to the OECD Productivity Statistics report.
Skilled labour force
81% of the German population have been trained to university entrance level or hold a recognized vocational qualification. The “dual system” of vocational education, which combines workplace training with academic training produces highly skilled graduates who match the needs of industry.
Investor friendly market
Germany’s investor friendly social-market economy promotes stable labour relations and a contented, motivated workforce. To date, 80,000 foreign enterprises have established businesses in Germany and now employ more than 3.7 million people! Additionally, in 2018, around 2,000 foreign companies opened up businesses in Germany.
Central Location
Ideally placed in Europe as a hub for goods and services, inclusion in the EU has benefitted Germany enormously. Germany shares borders with every major economy in central Europe, providing instant access to both established markets in western Europe and growing markets in central and eastern Europe.
Strong work ethic
Germany has an extremely well-qualified and conscientious workforce. The demand for professionals is met by 383 institutions of higher education and from an early age, German citizens are chanelled towards careers that allow them to reach their maximum potential.
Highly developed infrastructure
Germany’s well connected network of roads, railways and international airports is a major asset. In general, Germany has a highly sophisticated infrastructure and boasts a state-of-the-art telecommunications network to service business quickly and reliably.
Strong Support for SMEs
99.6% of all German businesses are SMEs. Many of these firms are highly specialized and often lead the market in their field. As the home of the SME, Germany is particularly supportive of smaller businesses, proving that size is no barrier to success in this country.
Made in Germany
This world-famous trademark is synonymous with the highest quality standards. Germany is also the world’s third largest exporter and whilst is famous for its automobile, mechanical engineering and electrical engineering success, futuristic industries such as eco energy production and nanotechnology are growing in importance.
Friendly Tax Policies
The Federal Government has introduced a raft of reforms to improve the general tax framework and keep labour costs down. This combined with the significant reduction in corporate tax levels is attracting increasing numbers of investors and securing a constant stream of new business.
The law is on your side
The German law makes no distinction between Germans and foreigners in the establishment of companies and no restrictions on the repatriation of profits. Nothing stands in the way of ambitious entrepreneurs with adequate capital to take a share of this lucrative market!