If you’re working in Germany and deal with customers or suppliers as part of your role, at some point you are likely to come into a situation which puts you in contact with external business partners.
Therefore it is important to grasp the basics of how to do business in Germany in order to start off on the right foot, and to better understand your colleagues, customers or suppliers on the other side of the table!
The Lowdown on German Business Etiquette Basics
Regardless of whether you work in sales, marketing, engineering, IT, finance or procurement, it is important that you have a good understanding of the basic German business culture and some common practices which come into play when managing or participating in a business relationship with a German customer or supplier.
One of our previous articles, as well as the video below, looks at German work culture in a more general perspective of the office environment, in case you’re interested in a more general overview.
So, let’s look at 5 popular scenarios you are likely to find yourself in, what you are likely to experience, and the best ways to conduct yourself.
Meetings in Germany, especially involving external participants, are usually scheduled long in advance and are expected to follow a set, planned agenda which is typically shared with both parties well ahead of the meeting.
Important for Germans is that everyone arrives to the meeting on time and prepared, and follows the structure of the agenda. A disorganised meeting, or spontaneously bringing up a topic which was not earmarked for discussion, could make your German business partners either irritated or uncomfortable. They will have prepared well for the meeting, and as such they anticipate that it shall follow the pre-agreed agenda.
Germans will rarely become irrational, uncontrollably emotional or raise their voices in a manner which is more common in Latin cultures. People are generally given the opportunity to speak, and interrupting them is considered rude.
The German communication style is generally quite direct, and they are usually not afraid to speak their mind. This may sometimes come across as curt, especially to cultures where causing offence or losing face is viewed adversely. In most cases, it is genuinely not meant this way. What Germans may lack in tactfulness and consideration for the other party’s feelings is usually made up for in honesty and being good to their word.
German business etiquette when negotiating is usually quite to the point, bypassing small talk and niceties and getting straight down to business. It is normal to start the meeting with a coffee and a fairly informal (usually vaguely business related) topic, but talking in detail about personal life is usually off limits.
A business negotiation with a German company is typically formal, professional but also approached in a consensual manner, while at the same time ensuring that any processes or internal company procedures are followed. Germans are usually pragmatic and look for a win-win situation, and do not usually get over-emotional or argumentative in a negotiation.
Where negotiations can sometimes hit a stumbling block is if you are asking for something outside of the box or original scope of work, and the key decision maker is not present in the meeting. Germans work in a rational, process and procedure-driven environment.
Their management, and with it the decision-making authority, typically is also a lot more hierarchical than some of the flatter structures seen in different work cultures, and as such any higher-level decisions may be deferred to a more senior person. Be prepared for this and ask up front that the decision makers are present for at least part of the meeting if this could be an obstacle to progress.
Getting German companies to move on aspects such as payment terms and lead-times is usually tricky. Ditto for expecting them to work overtime or weekends to complete an order or provide a service. German labour up to middle-management level is heavily unionised and as such, it is often difficult to lay on extra shifts or overtime at short notice because it requires consultation with and approval from the works’ council.
Businesses in Germany place high value on formal contracts, even for orders and accounts worth relatively small amounts of money. They will also see a contract as a very black and white document, and German business etiquette has very few shades of grey for manoeuvre or flexibility away from standard contractual terms.
If there is something you wish to be negotiable or subject to change, ensure that this is stipulated as such in any contract, or tactically leave it out!
Collaboration / Teamwork
For those of you who regularly read the Live Work Germany blog, you will already know that Germans can sometimes be challenging to deal with when it comes to expectations of British or American levels of customer service.
On the one hand, you can usually expect a trustworthy, reliable partner who will generally keep his promises and deliver your product or service on time, or will honour the payment terms you have agreed.
However, on the flip side, you will also most likely not encounter the greatest levels of flexibility. You need the lead-time bringing forward by 2 weeks? Or you need to make some last-minute changes after a contract has been signed or an order has been placed?
Then expect as part of regular German business etiquette to have a long discussion about why you were not able to plan or foresee this at the time.
What you would perhaps see as necessary flexibility from a customer or supplier would in most cases be seen by a German as chaotic and disorganised planning.
Quality and Expertise
German companies rarely play at the cheap end of the market. This goes to figure when you consider the relatively high cost of manufacturing in Germany and the highly skilled and educated workforce. Likewise for services: German consulting and expertise usually comes at a premium.
It is likely that you are paying a premium price for a top-end product or service, and as such the level of expertise you should get from your German business partner should reflect that. Often the unique selling point of the manufacturer will be that their product or service will reduce your total cost of operation or annual spend on something, even though the unit cost may be higher than another similar product or service on the market.
Also, it is worthwhile noting that agile career paths are less common in Germany than they are in other countries. Job rotation is not really practiced here.
Career development in Germany is seen more in the light of expanding and developing an employee’s expertise in their particular field of specialisation. It is not unusual to have somebody who has been in the same role for over 15 years.
In technical roles, it is also very common to have a technical expert at a senior level who is not an executive or senior manager but a real specialist in his or her field, often with a doctor title in the subject area in which they work.
Meeting clients or suppliers for dinner is usually a fairly informal affair, insofar as it allows more personal topics to be discussed. It is not usually used as a sales tactic to ply the customer or the supplier with alcohol to convince them to agree something in an underhand way.
Dress code for these meetings is often more relaxed. While Germans enjoy to relax over a beer or a glass of wine, drunkenness is extremely rare. Germans like to remain professional, even in an informal atmosphere. Excessive drinking for them is seen as dropping their guard.
Don’t expect a great deal of spontaneity if your German business partners invite you for dinner. It will most likely be just dinner with one or two beers or a bottle of wine. Late nights are uncommon, possibly because Germans tend to start work earlier than in most other European countries and because they highly value their work-life balance and family time.
Finally, my last tip would be, don’t expect a German to answer his phone or respond to email when he is on holiday.
Vacation time is generally respected here as a time of rest and recuperation. The very sensible attitude is that a business or project is unlikely to go to the wall just because a key team member is on a beach in Spain or Greece for a couple of weeks!