Dutch entrepreneurs with international growth ambitions often first look at our eastern neighbour, Germany. They’re close by, have a large market and are similar to us. But beware, doing business in Germany is slightly different for a number of reasons.
The Netherlands and Germany are important trading partners for each other. A large part of Dutch exports are destined for Germany. Equally, the Netherlands is an important partner for German exports. In 2020, the trade volume of both countries amounted to more than 172 billion euros, according to Destatis, the German statistical office. This puts the Netherlands in second place as a trading partner for Germany behind China (212 billion euros) on first, but ahead of the US (171 billion) and France (148 billion).
It is therefore not surprising that many Dutch entrepreneurs with international ambitions look to Germany but are we as culturally close as we think? The reality is that many Dutch entrepreneurs return from their German adventures disillusioned. To make it in Germany, you will have to be aware of the cultural differences that exist. So, what are the things you need to know about doing business in Germany?
Learn the German language
The Dutch are generally known for their good command of English, but you don’t get that in Germany. Business communication usually takes place in German, and many business partners expect you to have a good command of the German language. It is therefore wise to invest in your knowledge of German beforehand. This applies to both speaking and writing, so you can give business presentations or produce documents. Also, don’t forget a German-language website and make sure to hire a translator for this!
In line with the previous point, to really breakthrough and grow in Germany, it is often not enough for a Dutch person to speak the language well. It might be a better idea to send a country manager first, supplemented with 1 or 2 ‘locals’ who know the German market and culture well.
Watch out for too informal communication
The Dutch often adopt an informal tone fairly quickly after the first acquaintance. In the Netherlands itself, and also in the US, for example, this often works fine. However, the German business culture is a lot more formal than the Dutch one. Germans tend to stick to the polite form ‘Sie’ (u); Being on first-name terms usually only takes place after a while, and only on the express invitation of the business partner.
In order to break the ice, the Dutch usually also share personal information fairly quickly with their business partners, for example about children or hobbies. Germans usually prefer to get to the point faster; their private and business lives are, more than with us, separate domains.
Keep appointments in Germany
The proverbial Pünktlichtkeit of the Germans is almost a cliché, but the fact is that our eastern neighbours value agreements made. Do you have an appointment with a German business partner? Then make sure you are on time. And, if you make concrete working agreements with a business partner, make sure that you put these in writing and that you also comply with them.
Germans generally don’t like it when you start a discussion with them after receiving feedback – they simply want you to solve their problem properly and as quickly as possible. Not a quick fix, but a working, structural solution.
Pay attention to your product design
Germany is a country of engineers. Germans like well-made products and place a relatively high value on quality, reliability and reputation. Whereas the Anglo-Saxon countries may place more emphasis on marketing, product aesthetics and U X, all the Germans care about is that it works. Ultimately, what they want the best product, but it doesn’t necessarily have to look flashy.
In any case, Germans are usually a bit more reserved around a new product or service. While a buzz can quickly arise in the Netherlands about something new, Germans first want to see sufficient ‘proof’ in the form of references and reviews from other (preferably German!) customers and quality marks, for example.
And is your product or service still under development? Then hold off on international expansion to the east – Germans like to see a finished product.
Search for partnerships in Germany
To breakthrough in Germany, it may be advisable to enter into a partnership with a brand that is already more well-known. For example, florist Bloomon sought cooperation with the cosmetics company Rituals, which had been active in Germany for some time, in order to instil confidence among German consumers.
Doing business in Germany, more than in the Netherlands, is a long-term business. It can take a long time to gain the trust of a German business partner. A more aggressive approach, where you actively push your product or service, often backfires in Germany.
But once you are ‘on board’ as a supplier? Then there is a good chance that the relationship will last and that you will build a relationship with each other for many years.
Don’t throw away your business cards
In the Netherlands we use them less and less, but in Germany, business cards are still very important. Germans like to know who they are doing business with and often take a moment to study the business card.
They also attach more value to degrees than the Dutch do. Does your partner introduce themselves with their academic title? Use this especially in business communication.