Germany

Doing Business in Germany

Those considering doing business in Germany tend to do so with an optimistic view. Being ranked 20th by the World Bank for ease of doing business in the country and 25th in the Index of Economic Freedom is a testament to Germany’s forward-thinking approach to business, openness to global commerce, protection of intellectual property rights and sound business regulatory environment. Having become one of the largest exporters in the world and, thanks to the size of its population, the largest consumer market in Europe, analysts predict the nation’s GDP will expand by 1.9% in 2019.

Corporate income tax in Germany is payable at the rate of 15% of taxable income with an additional 5.5% solidarity surcharge imposed on the corporate income tax assessed. The challenge arises when businesses come to pay taxes with the German fiscal system being notoriously tough to navigate. There are 14 different types of taxes firms doing business in Germany may be liable to pay, all taking significant amounts of valuable time to process. Other commercial activities, such as registering business properties are often fraught with bureaucracy.

As with all countries, the key to being effective when doing business in Germany is understanding the people and culture. Academic and technical education are coveted accomplishments in Germany. This value carries through to senior management, who only delegate to technically competent, diligent employees as is evident in meetings, which are often well-prepared with a designated specialist from each relevant area saying their piece on the matter being discussed.

A tendency to take a methodical approach to business issues mean German professionals are often clear what their goals and responsibilities are but slow to adapt to new situations. Contrary to the stereotype, Germans have a sense of humour, but believe there are situations, such as serious business meetings, to which humour is less suited.
The World Business Culture website comprises practical advice and insight to prepare those doing business in Germany with the knowledge of the country’s people, culture and economy, enabling them to successfully operate a prosperous business in Germany.

Author

This country-specific business culture profile was written by Keith Warburton who is the founder of the cultural awareness training consultancy Global Business Culture. 

Global Business culture is a leading training provider in the fields of cross-cultural communication and global virtual team working.  We provide training to global corporations in live classroom-based formats, through webinars and also through our cultural awareness digital learning hub, Global Business Compass.

This World Business Culture profile is designed as an introduction to business culture in Germany only and a more detailed understanding needs a more in-depth exploration which we can provide through our training and consultancy services.