15 challenges of starting a business in Germany as a foreigner

Starting a business in Germany

Starting a business in Germany as foreigner

1. Economy

Germany is one of the strongest economic development countries, GDP 4140 Billion. Total population average 82 million plus currently whereas unemployment rate is 3 percent. Still, it’s a leading country in Europe considering economy, power, technology. Why do you like to be starting a business in Germany as a foreigner if you have no business plan? When think about Europe entrepreneurs must take Germany as right place of investment and new business in Germany. Foreign investment ratio is growing up gradually although some challenges are there to overcome. Survey to double check it is the right place of investment as foreigner? Market, cost, goods, competitors, manpower, infrastructure check twice.

2. Investment sectors

As export and import are common business in every country so Germany is also same. Major investment sectors are Automobile, Energy, Solar and Hi-Tech. Some government projects are good place of investments if win by tender. Besides, Garments I mean cloths are imported from Bangladesh, India, Sri Lanka and Chine so this is right place of clothing business.

3. Legal process

As being foreigner, you are advised to register GMBH company that is LLC. Proprietorship and Partnership are not allowed for the nonresidents. We can call Mini GMBH that is less costly to open. Take a good advice before starting a new business in Germany as foreigner. All draft copies are submitted to local registration court to get approval of company.

4. Time to open of GMBH company

To register GMBH company in Germany might need 4 weeks unless any incident come in. There is a process must follow step by step. If you do not contact the expert who do not know English language will take long time.

5. Cost

To Open GMBH, LLC company in Germany might need in EURO 25000. For Mini GMBH opening cost is 12500. This is government fees must carry by the entrepreneurs and opportunities for foreign companies in China. Professional fees vary adviser firms to other firms. Contact S & F Consulting Firm as Germany company registry service been providing since 2012 only for foreigners.

6. Shareholder

At least one physical person needs to register GMBH company and more partners are allowing. Fix a meeting with representative of S & F to discuss about company structure as nature of business. You are recommended to visit once and speak with representative of S & F before starting a business.

7. Company Name

As name is the identity of a company so name approval is the first step. Propose some good names to check the availability in Registry Office.

8. Business Plan

Each company has own business plan to start a new business. Plan taken by top management to be success in business. Initial plan, after 2 years and 5 years business plan strategy might choice by the plan maker. Expected financial forecasting and revenue meet time frame are clearly shuttle in paper to provide to banks. Make a good positive and trustworthy business plan that you like to executive.

9. MoA

Team of S & F Consulting Firm will prepare draft objectives and company rules as law to submit to registry office. Other forms and papers must need signature from shareholder, Managing Director to sign.

10. Notary Public

Registry papers must submit to notary as evidence of completion company registration. Every paper when collect and executive must go for notary as safety.

11. Trademark

As taking ownership of design and logo of business must take a trademark certificate to avoid any business dispute. You take ownership of own business as rivals always stare at you.

12. Bank account

To open a bank account in Germany is advisable ensure of share capital payment to bank. At the beginning Euro 12500 is OK and rest of payment can make as installment. To remember, buy any machine, property and fixed goods are considered as capital of the company. Make good agreement to proof of share capital being purchased machine in the name of company.

13. Office

This is must for all entrepreneurs when starting a new business in Germany as nonresident. Business office must be in commercial places along with tenancy agreement. In case of house place considered an office should take court order in prior.

14. TAX and VAT

As company registry is costly apart from that income tax for the corporate is 15 percent. VAT is 19 percent that is not lesser than many other countries. You must ask representative of S & F to register VAT and Tax number to get. VAT and TAX number is important, and part of company register in Germany.

15. Challenges of business

Any property if belongs to foreigners must register and that is costly. Besides, electricity connection takes long time to add in factory or office. Culture and language are barrier to starting a new business as foreigner in Germany. In case of settle commercial dispute court of Germany takes 12 months plus time with fees of 14 percent of total value. After paying Tax and VAT and operation expenses how much is your revenue after starting one year of business?

15 Challenges of starting a business in Germany as a foreigner

Can I start a business alone in Germany as foreigner?

Yes can

How much is professional fees in Germany?

Average fees in Euro 1000-3000

Can I trust the consultant to order of registering GMBH company?

Yes, can, you can contact S & F Consulting Firm as trust party.

Which banks can recommend for us?

Deutsche Bank, Commerzbank, KfW and bunq

Can I apply for work permit being director of company?

Yes, can, you can apply for a residence visa.


Company Registration Expert Since 2012