With a GDP increase of 2%, inflation at 1.56% and an unemployment rate currently standing at 3.6% for 2017, Europe’s largest economy is an attractive place to do business. Other than a reputation for exceptional engineering capability and being punctual, what else is there to say about Europe’s largest consumer market? As ever, understanding the business culture and landscape is essential to success.
German culture prizes forward thinking and knowing exactly what is happening and when, particularly in business. The German thought process is extremely thorough – each aspect of a project will be examined in great detail. Working is defined and regulated by structure. Germans believe that following clear lines of demarcation between people and places helps maintain structure and order. In business culture, this is reflected in their adherence to prescribed business rules. This can sometimes result in a lack of flexibility and spontaneity with regards to attitudes and values.
Sudden changes in business dealings and transactions – even for an improved outcome – are unwelcome. Business is taken seriously. Humor tends not to be appreciated in typical German business and there is no expectation or need for compliments.
Germans are most comfortable when they can organize and compartmentalize their world into controllable units. Time, therefore, is managed carefully. Calendars, schedules and agendas must be respected. Trains arrive and leave on time to the minute, projects are carefully scheduled, and organization charts are meticulously detailed. Do not turn up late for an appointment or when meeting people, even a few extra minutes delay can offend. If you are going to be even slightly late, call ahead and explain your situation.
Work and personal lives are rigidly divided. Germans subscribe to the ideal that there is a proper time and place for every activity.
This is of huge importance. Germany is a nation that is strongly individualistic, and one that demands high standards of respect. Unethical behavior will seriously diminish all future business negotiations.
Titles are very important to Germans. Do your best to address people by their full, correct title, no matter how extraordinarily long that title may seem to foreigners. This is also true when addressing a letter. First names are reserved for family members and close friends. In business, until you know otherwise, or have developed a personal relationship, it is very important to refer to your German colleague with his or her title (respectively, Herr and Frau for Mr. and Mrs.) plus the last name. Do not use the first name until you have established a friendship. If someone is introduced to you with an additional title, e.g. Dr., use it. This is a formal culture until people get to know each other.
Just as important as knowing your counterpart is understanding the numbers behind them. Our downloadable PDF contains in-depth insight and analysis to help you make the most of cross border trading with the world’s fourth largest economy.