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Made in Germany!

This is not just any tag that we find on the bottom, side or back of the product, but it is a trademark of superior quality for more than a century. Many aspire to start up businesses, be it big or small, in Germany. Before one embarks on any new venture, a proper research has to be done, so as to acquaint oneself about all the plausible complexities that may lie ahead and their solution. For all those hoping to set up any kind of business in Germany, here are the key points worth pondering-

 

  • Knowing the local language- Only after qualifying preliminary test, can you dream of a fuller and a flourishing merchandise. Not only would you be able to study the local market well, but also your prospective clients. Once you learn the local language, you can easily prepare a firm ground for establishing your business. Attend a language course by enrolling into a language school, that should be your first and foremost priority. Learn to communicate with the locals.

  • A business plan- Do you know what makes for a successful enterprise? Proper planning. Yes, it is the foundation on which your business would either stand or crumble, so make sure it is strong and sturdy. It is recommended that you evaluate your business's risks and chances, and prepare your business plan accordingly. Your business plan is not just obligatory but on it depends the approval of banks and German authorities, which will either give it a thumbs up or thumbs down.

  • Bureaucratic hurdles- Rest assured that no matter what form of company you have, a small and solo proprietorship or a larger conglomerate, you will most definitely go through a lot of bureaucratic hurdles. It is advisable to first contact a tax advisor (Steuerberater). They will advise you if it's necessary to hire a notary and how to register your business at the local court (amtsgericht). After this, the chamber of commerce will contact you, having obtained your details from the commercial register. The next step is organizing your tax registration into two sets; one for commercial tax at Gewerbesteueramt and the other at the local tax office (finanzamt). After filing these two tax registrations, you will obtain a certificate of registration (gewerbeanmeldeschein) and thereby commencing your business.

  • Know how- Irrespective of the nature of your business, be it providing a service or manufacturing goods, you not only need to know your trade well but also prove your expertise better than your German counterpart.

  • GmbH ( Gesellschaft mit beschrankter Haftung)- it is a limited liability company and is by far the most widespread company form. Under it the shareholders are not personally held responsible for the company's debts. Just one person is needed to set up a GmbH, and its share capital is minimum of 25,000 . Since 2008, entrepreneurs have begun a sort of mini GmbH (unternehmergesellschafthaftungsbeschrankt), the primary motive of starting such a company was to give considerable leverage to the start ups with its simplified bureaucratic efforts, and the minimum share capital is reduced to €1.00

  • Commercial expertise- You need to know the nuances of business to ensure a productive trade. Different aspects like accounting,costing, pricing etc. must be handled intelligently. You can even turn to expert opinion on such matters from either private companies or various German government agencies. The latter also provide information in English on their websites, and you can easily download their brochures in English. They offer handy tips and advice on topics like, self employment, company set up, and other business related concerns in Germany.

  • Hiring helping hands- Well, it is a tricky and a little complicated affair. If you employ staff from your own country or some other country, you'll have to prove that you are not taking away the job of a German. Workers fall into the following category-

  • A full or a part time employee ( Angestellter)- Hiring them puts a lot of obligations on you or your company. The employer has to deduct taxes and insurance premiums from their salary, ensure a fixed vacation each year, along with complying with the laws that protect the staff from arbitrary dismissal. The premiums of the German national retirement, unemployment and health insurance are jointly shouldered by the employer and the employee.

  • Free workers (freie Mitarbeiter)- they are the workers who are responsible for their own taxes and insurance. The employer or the company has the privilege of utilizing their services when needed and paying them on the completion of desired work. Something like, 'work and pay, no work, no pay.' Their services can easily be terminated at any point of time, if the work is not done satisfactorily.

The most favourable aspect in starting a business in Germany is that the German government is very flexible to the establishment of all types of businesses, regardless you are a German or non German, provided your business has a positive impact on the economy. Your decision to be self employed usually depends on the type of business undertaking, your qualification and expertise, your entrepreneurial skills, the amount of invested capital and the uniqueness of your business proposition. Your Local Foreign Office would require certain documentation from you in order to consult with the Local Chamber of Commerce or Crafts or other related organizations, to check whether or not your business is economically viable, and specialized enough to compete in the German market. If they approve your business plan, you would be granted a residence permit soon.

 

I have precisely given all the needed guidelines, in order to give you a rough idea about the technicalities that go into starting a business in Germany. In a nutshell, it can be said, though it is not an easy undertaking, but you can still carve a firm niche in the German market through your merchandising skills, courage and patience, which I believe are needed in every profession, everywhere. It all depends on your mastery over the rules of the game.

 

 

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