In the first of our guides on doing business overseas in other countries, we look at the economic powerhouse that is Germany — the linchpin of European manufacturing and services industries. Understanding German business etiquette is the key to success there.
Germany has 83 million consumers and a robust economy, which makes it one of the world’s biggest markets with high purchasing power and great potential. There is competition at an individual level among classmates, fellow students, and colleagues, but also between departments of the same company.
To be able to succeed in the German market – both as an entrepreneur and as an employee – it is good to understand how Germany and the Germans “work” and what unwritten German business etiquette rules they follow. This journey of discovery is both exciting and rewarding even for your own personal development.
You may find many differences between your home country and Germany. Below we offer you some German business etiquette insights to get a better grasp on the German business culture in order to work out your own strategy for success.
Necessary documents to start working
Before understanding the topic of business etiquette, let’s see what documents you’ll need to get settled in Germany. First and foremost, what needs to be emphasized is that before applying for your visa, getting German health insurance is mandatory.
You can choose between public health insurance (Gesetzliche Krankenversicherung, GKV) and private health insurance (Private Krankenversicherung, PKV). The main difference between the two is that you can acquire private health insurance if you earn a gross income above threshold for compulsory health insurance of €62,550 per year (as of 2020). If you earn less than this amount, you must take public health insurance.
Make sure to find accommodation in the city of your choosing, register your living address through a procedure called Anmeldung, open a bank account, register at the local tax office (Finanzamt), make your appointment for a residence permit, and then you are ready to get out there and see what opportunities are open to you.
German business etiquette: Greetings
You may have heard about the German expression “Ordnung muss sein” (There must be order). This can particularly be observed in the work environment and there are some unwritten German business etiquette rules you might want to know. In general, greetings in Germany between two people are quite formal, at least when it comes to business and other work-related matters. A proper handshake is usually the only thing required.
You should keep in mind that the Germans are careful with titles because the use of titles is associated with respect and it becomes noticeably more important as you go higher up in the hierarchy. In this respect, the Germans can sometimes seem old-fashioned, but when addressing people, you should use their last name and preferably “Herr” or “Frau” before it.
Something to keep in mind are the words of courtesy “bitte” and “danke” (go ahead and thank you), which are used by the Germans in every situation, whether they are in a market waiting line or in work-related situations.
Gestures and understanding the Germans
Differences in the non-verbal communication between two people of different nationalities consist of gestures, body language, ways of greeting each other, and how one behaves in a discussion. When working with people from other countries and cultures, it is obviously an advantage to have some knowledge of cultural differences in communication.
Gestures in Germany are basically the same as in the Western world but one thing to avoid is to show the ok sign, where the thumb and forefinger are joined together to form a circle and the three remaining fingers spread outwards. This is not perceived as a good gesture in Germany.
At first glance, Germans may seem stiff and cold, but that’s probably because their circle of friends is a little smaller than maybe that of Americans or British people, and it may take a longer time before you really become friends with a German. They prefer not to talk about private things with someone they don’t know well, nor should you ask or go into such things when you have just met them. Private life and work are kept separate.
Busines relationships
Fostering good relations with the Germans is important, as they want a person to be reliable and competent in order for them to become business partners. When you finally start a relationship with a German, whether business or friendship-related, you have a faithful and reliable friend.
A simple thing like using a mobile phone in Germany is often not acceptable if you are in a restaurant. Germans are friendly and understanding in personal relationships, and when it comes to work-related ones, they are pretty straightforward though still polite. They do not fear conflicts, they demand quality, and that the business partner also gives their best.
It is repeatedly emphasized that the Germans are more vigilant about their title being used in communication. It is recommended to address them with the phrase “Sie” (the formal “You” in German) to also show respect and keep the necessary distances in a working environment. The level in the organization they are in does not make a difference, the title is always included and should be used.
Negotiations with German business etiquette
When negotiating with Germans, preparations are a must in German business etiquette. They have clear goals for what they want to achieve with those particular negotiations, and of course, they expect the same thing from the other party. Both in negotiations and less formal meetings, shaking hands with everyone is the first thing, which says a bit about how the Germans think everything should be done properly and consistently.
Something that should not be a major surprise is that punctuality is an important thing, and should be respected in German business etiquette. If you overlook this, it could be very detrimental to the relationship you have with the people. If you have to sit in meetings, the times are kept strict, both the time for the beginning and the end, even if not everything has been dealt with. German meetings are usually short and effective, at least when it comes to meetings between managers and subordinates.
Parting thoughts
Germans prefer to follow certain procedures and ways with even the simplest things, both in everyday life and at work. In order to achieve career success in Germany, business etiquette is something you must understand before preparing all the documents that the German system requires when moving to this country.
With all this, you can, depending on the situation and goals, choose the best approach from a business culture that is internationally known as extremely stimulating, incredibly diverse, and successful.
