Successful in Germany- Market Entry Strategies

Ljubljana 23.4.2015

Motivations to enter the german market

• Innovative Product

• good Export experience in the neighbour countries

• Systematic market development

• Other reasons??

Homework done?

• What is so special about my product/service in comparison with products/services which are already present in germany?

Careful research Understand the market Good sales argumentation based on the research

Homework done?

• Is there a market –entry strategy?

Based on the research you should plan the market entry strategically

Set a good focus which fits to your product Marketing: Are you a small and „flexibel“ company or a

bigger one with a lot of knowledge and know how?

Homework done?

• Who in your company is responsible for the project „Market entry germany“?

The person/team has the basic qualification: knowledge of german culture,language

The team knows the market entry strategies Goals are cleary set

Homework done?

• Do you have a budget for entering new markets? You need a budget for entering the market , to produce

marketing materials to consult partners/agencies etc.

Homework done?

• Verification about your certificates? (ISO/TÜV)• Do you have a homepage in german language?• Do you have info material (Flyer, Broschure, product

presentation) in german language?

Factors of success on the german market

Quality of the product

Choose the right local partner

Good contacts/network(Cluster!)

Service

Good knowledge of the market

Cost performance ratio

Technological advance of the productConcrete economic concept for the market entry

Reliable businesspartners

Financing????

Which cooperation models are existing in germany?

1. Exclusive representation through one Sales Partner

2. Cooperation with sales representatives3. Direct adressing from Slovenia4. Open a company in germany 5. Cooperation with an agent/consultant

.

Which cooperation models are existing in germany?

1. Exclusive representation through one Sales Partner+ Exclusivity, ideal for a special product with a special peer group

+ low risk+ time/money? Network of the partner has to be exellent? No direct knowledge about the german market- you enter the market but you dont establish yourself

.

Which cooperation models are existing in germany?

2. Cooperation with sales representatives+ big and well organised network in germany

+ represents usually complementary products/services + from the german costumer side sales representatives are well accepted?+ take a provision= endprice of your product!!? Again: network /structure of the costumers

.

Which cooperation models are existing in germany?

3. Direct adressing from SloveniaYou need to have qualified stuff- knowledege of the german language, sales & communication skills+ no provision+ you can take own decisions+ you gather experience+ use partners consdultants (point 5!)-Market entry can take a long time-Financial resources

.

Which cooperation models are existing in germany?

4. Open a company in Germany Makes sence in sensitive sectors (food,health care, bio) where it is important the you build up trust towards the end costumer.Usually a company is established when there is already a high export rate to germany.

+ Germany trade and invest or Country agencies like Invest in Bavaria offer you support free of charge+ regional subsadies in Germany, especially for innovative/start up companies

.

Which cooperation models are existing in germany?

5. Cooperation with an agent/consultant

+ Builds up a Business relationship to costumers/partners in professional way through his/her network

+ Defines together with you the market entry strategy+ Organises individually for you meetings with potential clients/partners in

Germany+ Individual, quicks, focused on your aim?Costs

.

Which cooperation models are existing in germany?

Costs?!

• Sales representatives work on a comission basis• If you have an exclusive sales representative a salary will have to be paid• Agents: normally a project is charged by hours

.

Which cooperation models are existing in germany?

Costs?!• Example: Cooperation with an agent:• Project for 6 months (Establishing market entry in Germany)• 1-2 hours/day (Mailings, Meetings, cold calls)= 20-40 Hours for 6 Months• Costs per Hour ca. 90,-• 30 Hours x 90€ = 2700€

.

Information about sectors and business in germany

.

Marktinformationen

How to find a partner?

Use the cluster network in germany!

.

Centralvereinigung Deutscher Wirtschaftsverbände für Handelsvermittlung und Vertrieb

VBIDeutscher Verband Beratender Ingenieure

Trade fairs in germany

Quelle: Austellungs- und Messeauschuss der Deutschen Wirtschaft

You can find information about all the trade fairs in germany in slovene language here:

www.portal-sejmi.si

One of the most important marketing tools in germany are trade fairs

What support can you expect from the german chamber of commerce?

Strong partner network in Germany (local chambers, country agencies, Germany Trade and Invest, Invest in Bavaria, Clusters)

SERVICE- our daughter company DESLO d.o.o. offers services to german and slovene companies:

Business partner research Advertisment campaigns in Germany Organisation of group pavillions on german

trade fairs Supplier projects Cooperation forums Delegations to Germany

Individual meetings after the workshops!!!

Our partners in germany

Our partners in the world

80 Länder 120 Standorte 1,400 Mitarbeiter 40,000 Mitgliedsunternehmen 98% des deutschen Außenhandels

• A successful market entry needs approximately two years of professional preparation

• For most of the slovene companies the main challenge is to establish the first contact in the german market

• „Open the door“• For the first contact it is important to build up trust!• Good Practice: a lot of slovene companies cooperate

succsessfully and already for a long time with german companies• Slovenes know the businessculture in germany very well• Slovene companies know what is important to establish a

longlasting cooperation• Germany is a huge market- many companies decide to enter

Germany through Bavaria

Personal Challenges & Experience

The perfect market entry:

1. Professional Market analyses Competitors Answers the question: Is Germany waiting for my

product/service?

2. Result of the analyses: yes, it makes sense to enter the market- go on! No, it will be hard : a lot of competitors, price performance,

quality- think&stop! Do i need to change my product? Is it more suitable for another market?

Challenges & Experience

The perfect market entry:

3. Market entry Consult an agent if you cannot do it on your own! Arrange a meeting with the agent and discuss the strategy Result can be: Find sales agents for me! Set the time table for the project and prepare the marketing

material

4. Meet the sales agents/contacts They will sell for you, if you are not satisfied- change them Start with one region (very often its Bavaria or other southern

countries of germany) and spread your network of sales representatives

Challenges & Experience

The perfect market entry:

5. Be present on Trade fairs Support your agents Be present on trade fairs to gain new contacts, also to the end

costumers

6. Long term Build up a trustful relationship with your partners and clients

7. Congratulations- you did it!

Challenges & Experience

How to find the right partner?

AHK Slowenien – Your bridge to the german market

We… provide Information solve problems offer services connect you

Thank you for your attention!

Simon Pöpperlstellv. Geschäftsführer

Telefon: +386 252 88 62 E-Mail: simon.poepperl@ahkslo.si http://slowenien.ahk.de