German Business Culture

German Business Culture

Germany has the world's fifth-largest economy and is a major hub for European business. Both the service and the manufacturing industries are extremely buoyant in Germany, a country respected world-over for its automotive and engineering sectors. In Germany, culture standards and values are central to doing good business. Whether you're looking to move to Germany for work or you want to trade with German business, understanding the German business culture is paramount to your success. 

Doing Business in Germany

Knowing the German business culture is important to start new endeavors

Business is taken seriously and German values such as fairness, loyalty, punctuality, professionalism, and reliability should be reciprocated. In general, German business mentality means that negotiations are fair and agreements are rarely changed or disrupted at the last minute. Transparency is also important, which means that corruption is uncommon, as is the buying of gifts or the handing out compliments in order to charm your way to a good deal. 

Ethics are central to daily German business practice, as is corporate social responsibility. Communication in business culture is formal and employees speak to each other politely but efficiently. German work ethics mean employees always turn up on time and do a full day's work, they are in turn rewarded with fair pay and good working conditions

Everyone in Germany wants every task, big or small, to be completed to its best, on time and with high satisfaction for the end consumer. Germans place a strong emphasis on the quality of their products and services. Employees are generally loyal to their employers and share their desire to create high-quality products and provide dependable services. 

Shaking Hands

A vital feature in the German business culture

Shaking hands is a typical gesture in good German business etiquette. It is expected that you shake hands with any client, colleague, employer or employee at the first meeting. Depending on where you work, it may even be commonplace to shake hands with customers. Examples of this may be at an estate agency or car sales showroom. 

When you shake hands in Germany, shake with your right hand but ensure your left hand is not in your pocket, which may be seen as rude. For a German, eye contact during a handshake is very important. 

It's not just the business world where shaking hands is common, it's also common amongst friends and even family, especially men. It is common amongst both genders when meeting someone for the first time. Unlike the more touchy-feely cultures of Spain, France or Italy, personal space in Germany is safeguarded. If you have ever been to Britain, you will find the German shaking hands culture is very similar. 

Tip

As a newcomer to Germany the safest thing to do is always shake the hand of any new person you meet.

How do you greet in a German business? 

Always greet business colleagues and clients with a handshake and use formal titles. This is especially important the first time you meet. 

How can I be polite in Germany? 

Germans are not aggressive or pushy. It is normal to wait for a person to finish speaking before you speak and treat everyone with respect and dignity. Maintain good eye contact when you speak, keep hands out of pockets and use a person's surname with the titles Frau or Herr (Mrs/Mr) until first name terms have been established. 

Business Dress Code

How to dress in the workplace

In Germany there is a formal dress code in place at the majority of workplaces. Men generally wear suits and ties, whilst women wear simple trousers or skirt suits.

In young or emerging sectors companies such as PR agencies or tech start-ups, especially those located in the more cosmopolitan cities like Berlin, it is common to find people dress informally to work.  

Tip

If in doubt, however, always opt for more formal attire. It would certainly be frowned upon to turn up for your first day in trainers and casual clothes when you should be wearing a suit.

Punctuality & Reliability

This German stereotype is very much true

Punctuality is very important to Germans, and is especially vital in business. Always attempt to arrive early and allow plenty of time to get to where you need to be.  

If you think you may be running late for work or for a business meeting, always call as early as you can to let your manager or the person you are meeting know in advance. In Germany, punctuality is a sign of reliability and you may be judged harshly if you are late, even once. 

Tip

Whether it's a job interview, an appointment for a residence permit or even an appointment with an estate agent, get in the habit of arriving early.

Fairness & Loyalty

Other aspects of the German business culture

Germans tend to operate fairer business practices than you may experience in other countries. This sense of fairness includes equal pay, good working conditions and fair disciplinary practices. It also means that employees are not generally expected to work more than their contracted hours. Most offices close at 5pm Monday to Thursday and 4pm on a Friday. 

German businesses also reward loyalty, both to their employees and to clients. In Germany it is likely that a business chooses the same client for many years, enjoying the advantages that loyalty offers, rather than constantly looking for cheaper services elsewhere. 

Germans always do business in a civilized manner, preferring to find a compromise between two parties rather than force their views on the other party in an aggressive or pushy manner. In Germany, boards tend to feature many more women than most countries (although there is still an imbalance).

In 2015 government guidelines were published to advise that non-executive boards should be at least 30% female. This improved gender balance tends to mean a more nuanced and human-centered approach to problem-solving, and less pushy or domineering practices. 

Tip

Loyalty is rewarded in Germany, so be prepared to work hard and be patient.

Hierarchy in Germany

More about the German organizational scheme

The organizational culture in Germany is hierarchical, and as a meritocracy, those who have reached the top should be respected as individuals who have worked hard. Most large businesses are governed by a CEO or a Board of Directors, under which is a strong team of managers. Decisions largely come from the top and employees in Germany are expected to do what is asked of them. Because the German business culture is generally fair on employees, it means that grudges, disputes and rebellion are uncommon. 

Germans have a direct way of speaking to one another and are not overly friendly or spirited in their communication. This means you should expect your boss to be short with you, and consider this a normal, respectable way for them to communicate. Germans like to get the job done rather than waste a lot of time talking about it, so communication that seems short is in fact, simply efficient. 

Negotiation Process

Be prepared and know your facts is our main tip

Negotiating a sale or contract with a German business is generally a fair, well-mannered and well-planned process. Business communication in Germany is carried out in formal language, using full titles. Introduce yourself formally, adding any credentials that you have. 

If you are trying to offer a service or product to German business, make sure you can back up everything you say, Germans are not sold on flashy behavior and emotive language. Make sure you have the data to evidence what you are claiming. Be punctual in your arrival time for any appointment, meeting or even phone call and keep to time during a pitch or presentation. Negotiations may be agreed with a handshake, but expect formal correspondence to follow. 

Tip

Pitch close to where you want to be. Germans are not accustomed to excessive price negotiations. They want to know what a product is worth and what you want for it so they can plan.

How do you negotiate in Germany? 

Germans negotiate in a fair, open and transparent manner. Claims should be backed up with data and fair prices should be offered or requested. All negotiations should be undertaken in formal language and it's important to be early for any meetings or appointments.  

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