German Mittelstand - where are you? Why many networking events for SME suck in Germany

by Hermann Kracke

Why do the directors, owners or other decision-makers of German SME despite of everybody’s good intentions usually not seem to attend (even very decent) networking events organized by industry associations?

If you have asked yourself this questions you are in good company of other service providers interested in the German market I have had the chance to talk to.

There are obviously no simple, magic formula type answers - but a lot of the responses I could think of revolve around the particular way German Mittelstand companies operate, their work ethics and the business culture in Germany in general.

If you could not come up with really satisfactory answers to that question yourself - I believe it is - because a true understanding of your future partner’s motivation and culture are more essential than business people sometimes like to think. And it does not happen overnight.

But let’s start at the beginning. You have set out and come to Germany for what seems to be a good event, organized by a well-known business club, chamber or industry meet-up, perhaps even as a member of an official delegation of your industry representation.

There has been a lot of talk on how that trip or event would be a great occasion for meeting potential partners in person, who would as a matter of course show up in great number, quite possibly eager to discuss a promising project, if not close a deal.

Then you go, ready to explore, a little bit excited. The event will be held at an ultra-modern venue, posh hotel, complete business class set up. Politicians, officials and honorary representatives will make friendly introductions, the buffet rich and excellent, everything very nice… except just one problem: German Mittelstand companies nowhere really to be seen.

Actually there will be German attendees and possibly lots of them. But these often have come to ultimately offer services themselves: Lawyers, consultants, coaches, people of my kind, sincerely trying to help you along the way, unfortunately though not outsourcing any work or process to somebody else.

Owners of German Mittelstand companies don’t (come to) talk - they work. Many would say they don’t have the time to sit around in a forum all day and listen to well meaning speeches when they could instead be busy in their laboratory trying to improve the formula of the product they have for the last couple of months been working on.

While the consultants will be lining up for the hors d’oeuvre the typical German engineer turned business owner will be experimenting with some new material. He may also be trying to get that cursed customs clearance for his merchandize that has been stuck for weeks at some far away harbor but he will usually not attend a two-day conference in a five star hotel on the latest industry fad.

Meetings are important in Germany and once arranged will be taken seriously. Usually, however, they will not be set up following a vague idea of getting together for an open or general discussion. Rather the wish to meet should here result from an imminent agenda.

Instead of knocking at a German director’s door (should you get that far without a precise date and time mutually agreed weeks ago) in a “Just wanted to drop by and say hi” kind of way - you’d better prepare to present a coherent pitch as to why meeting would make sense at this time and what you are going to propose or achieve.

I’d sometimes even go to such length as to suggest an agenda in advance and send my business partner palpable points of possible discussion a week or two before the meeting is scheduled to take place.

Of course, they will. If another German business partner, a common friend or the representative of your Chamber of Industry and Commerce can make an introduction for you the meeting will as anywhere be more likely to happen.

Even then, however, “my old acquaintance Thomas Meier felt we should meet some time” and then not much more - in my experience - will not lead you very far. German executives rigidly plan their time in advance and may not appreciate too much casual small talk or as they would perhaps think “useless chatter”.

Again, better to be prepared, confidently show that you have done your homework and lay out your proposition.

So, wait a minute… 'homework‘ what is that supposed to mean?

If you are ready and eager to offer your service in Germany but you haven’t found suitable business partners yet it means doing your market research thoroughly narrowing down who you need to get in touch with instead of hoping to meet somebody at an open event rather coincidently.

If you have identified who you need to talk to and assume that this person loves her product (and company) dearly - learn as much as you can about that partner’s offering, about their market position, on any current issues or recent events related to their business.

Do not lose time with too much idle chitchat or very vague openers such as: “How has business been for you recently?” or “So, what do you do?”

The idea is to show that you genuinely care about your business partner’s issues and one of the best ways of doing that is to demonstrate that you know their product or service inside out.

This will also enable you to ask them specific questions which are more likely to get a deeper conversation started.

For the same reason, by the way, one type of event may be a safer bet for a visit: Trade shows.

Germany is the world’s number one destination for visiting international exhibitions. Around two-thirds of the world’s leading trade fairs for various industries take place in Germany. That is 150+ major events (but many, many smaller ones, too), some 180,000 exhibitors and around ten million visitors every year.

One of these many occasions may be a better fit for you - as here SME do attend as well - although it’s often advisable to avoid the large consumer centric events. The more specified, the more product focused - the higher the chances to engage in a meaningful conversation and later build a promising relationship.

At trade fairs as well, however, in my opinion the same rules suggested above apply.

Prepare, do your homework, use their passion for the product as the angle to make a successful approach.

For first steps on trade shows in Germany also check number 6 of the Resources section of my website.