The business environment in Germany

Germany is a country with a business environment that is attractive both to new business owners and investors. Germany is the largest European economy and globally ranks fourth.  Despite the effects of the global recessions, which led to the slowing down of outside investment and the subsequent Eurozone crisis, Germany remains a country that offers a conducive environment for the operation of businesses. The country has a diversified and big economy supported by dependable and well-developed infrastructure, a legal environment that’s stable, a positive social climate, a highly skilled workforce and a long record of world-class development and research. Establishing a business in Germany doesn’t necessitate that one be versed with the complex tax structures and bureaucratic procedures involved. Instead, you can use review sites such as to look at some of the German brands and how they have been able to establish successful businesses in the country. Cafago will, for example, help you if you are interested in the electronics and multimedia segment. Below, insights on why you should consider starting a business in Germany are discussed.

Germany has a pivotal consumer market

Having a population of 8.4 million, Germany is the biggest customer market in the EU. It is ranked as the third biggest exporter and the second biggest importer of consumer-oriented agricultural products globally. It is also one of the European markets that is most important for foreign producers. Furthermore, German offers a robust marketplace for businesses beyond the country’s borders. The country hosts some of the biggest trade events globally, where a significant amount of trade occurs. These events include the ITB tourism show, the Hannover Fair and the Automechanika, among others. This, together with the fact that Germany is geographically located such that it is the European Union’s epicentre, makes it a cornerstone through which a majority of firms, especially from the united states, build their expansion strategies both to the EU and globally.

Germany is diverse and multicultural

One of Germany’s greatest advantages to businesses is that it does give any distinction between foreigners and locals when it comes to creating companies and offers no limitations as far as profit repatriation is concerned. More so, the country has a population that is open-minded and accommodates diverse cultures, thus making it easy for a foreigner to live in the country. German is known to be immigration friendly; for example, statistics indicate that in the year 2016, the country experienced more than 1.5 million expats. The numbers have continually increased, and approximately more than 10 million people from various countries call Germany home. If you know the German language, then this is an added advantage to you. However, it’s not a must that you know the German language, the huge number of foreigners living in the country enables you to communicate in English excellently.

Investment incentives

Germany is a country that provides quite a variety of public funding instruments and incentive programs that can be very beneficial for funding purposes. Some of the common programs you’ll find in Germany are.
Developments and research grants:
Special grants are aimed at helping development and research. They include special partnership programs and interest-reduction loans.

GRW cash grants: The government, from time to time, offers grants that help reduce the cost of setting up new facilities. Such grants may include reimbursing up to 20% of eligible investment costs for medium companies, while small companies can get up to 40% reimbursement.

Grants for hiring: The German states and the German Federal Employment Agency have various labour incentive programs created to meet the need of companies that want to increase their workforce.

Germany is deeply committed to innovation

Germany is ranked amongst the 10 countries that are most innovative world over, focusing on utilizing science to help the country benefit economically. The country is well known for being able to apply research practically efficiently. Its emphasis on the practical application of knowledge has seen an increase in job opportunities in Germany and a way in which scientific research in the country gets to have practical benefits to the society at large. The deep commitment to innovations is demonstrated through the support to start-up companies funding research institutions and offering licenses to intellectual property while making it possible for researchers to build their careers out of academia.

Has a robust start-up culture

German is known for having a strong start-up ecosystem. The country’s most vibrant ecosystem for starting a business are Munich, Hamburg and Berlin. Of the three, the last decade has seen Berlin becoming the leading Techhub in Germany. With a diversity of connections and experts, the open-mindedness, vibrancy and creativity make it a great place to establish your business strategically for global expansion.

In conclusion, German has an environment that is highly conducive for business, and this article has discussed the topic in length.

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