If your company is running smoothly in the Netherlands, then it’s very interesting to literally and figuratively expand your business boundaries towards the German market. But how do you approach this correctly? Our Germany expert and export coach Jan Willem Temmink is happy to share some experiences and tips on doing business in Germany.
First, start a market research in Germany.
It all starts with thorough research. To determine if now is the right time (time-to-market) to launch your product or service on the German market, market research is crucial. After all, you want to know if there is demand for your product or service. Is there competition, or are you the first to explore the German market with this product or service?
Communication research to convey the right message.
Not only is market research important, but marketing and communication research is also necessary if you want to do business in Germany. Germans communicate a number of things fundamentally differently than we Dutch are used to. Sometimes a message really needs to be conveyed differently. What is very natural for us can simply be a no-go for our eastern neighbors. Furthermore, in connection with marketing and promotion, you need to ensure a substantial budget.
The German consumer market, for example, is five times larger than in the Netherlands, and the industrial market is even ten times larger! This therefore also requires a considerably larger promotion budget than you would normally need for your promotion in the Dutch market.
How do you bring your product or service to the German market?
Once your research shows that there is indeed a market and interest for your product or service, the next step follows. How are you going to market things? If you are going to use sales partners, sales agents, or importers, the choice of a sales channel is truly crucial. After all, you are bringing in an outsider who has no direct link with your company or service, so you can only exert limited influence on the sales efforts of this third party.
You really need to realize this very well beforehand and make it a point of discussion with the partner you choose. What are they going to do to promote your product? How will they report on progress? Are you going to market the product yourself, or will they do it through the channels they use?
Utilize the right German sales channels.
If you opt for the deployment of (German) salespeople, then especially choose mid-to-senior level salespeople with a warm network of clients in your industry. After all, this leads to faster appointments and orders. In this case, the saying really applies: cheap (junior representatives) turns out expensive (if things don’t get off the ground and you even have to buy out an employment contract).
Doing business in Germany: different laws and regulations.
Naturally, you also need to take into account the laws and regulations in Germany. German business life is very strongly legally determined. This certainly applies in sectors such as construction (supply), the medical sector, and IT applications in the cloud (SaaS). And what are you going to do with your company structure, for example? The GmbH as a business form offers many advantages.
That Dutch passage translates to:
For example: if you have fewer than 10 FTEs (full-time equivalents) in employment, the principle of ‘hire & fire’ applies without difficult procedures at the ‘Arbeitsagentur’ (German Federal Employment Agency). If you are going to offer your products or services via a website, you also need to take a number of aspects into account. Ensure an ‘Impressum’ (legal notice), ‘Allgemeine Geschäftsbedingungen’ (general terms and conditions), and ‘Datenschutzerklärung (inkl. Cookiestatement)’ (data protection declaration including cookie statement) on your German-language website and/or webshop. Otherwise, you risk a so-called ‘Abmahnung’ (formal warning) by lawyers.
Don’t hesitate to enlist our help: this can often be done with the aid of a subsidy.
In short, you see that there is quite a bit to think about and research before you decide to extend your borders towards Germany. If you want to do business in Germany, then the (export) coaches at Brilliant Work will gladly help you on your way. Often, you can use our services with the aid of a subsidy. So, do you have plans, or do you have questions about export? Then feel free to contact us without obligation.
