Germany – Opportunities and Potentials

Maribor 21. November 2012

Germany at a Glance

Slovene German Business Relations

Key Sectors in Germany

How to Find a Partner?

Germany at a Glance

Slovene German Business Relations

Key Sectors in Germany

How to Find a Partner?

Typical German?

Leading Economy

Global Player

High Productivity

Qualified Workforce

Innovative Power

First-Class Infrastructure

Inviting Incentives

CompetitiveTax Conditions

Secure InvestmentFramework

Quality of Life

DEUTSCHLAND

Baden-Württemberg

Sachsen- Anhalt

Sachsen

Saarland

Rheinland- Pfalz Nordrhein- Westfalen

Mecklenburg- Vorpommern

Hamburg

Thüringen

Brandenburg

Bayern

Schleswig-Holstein

Bremen Niedersachsen

Berlin

Hessen

Germany at a glance• Slow down yes…… slump no

• Germany is also hit by the euro crisis

• Short-term economic outlook is therefore quite modest with growth rates around 1 percent in both 2012 and 2013.

• The fundamentals are still positive: Interest rates are extremely low, and the labor market is robust.

Germany at a glance• Domestic consumption supporting growth

• Construction actively remains at a high level

• The big “If” is that the euro crisis does not escalate

• Long way out of the euro crisis

• Tough recovery for the European outlook

Germany at a glance

Quelle Commerzbank, Statistisches Bundesamt Deutschland

Indicators 2010 2011 2012Forecast

GDP 3,7 3,0 0,8Private consumption expenditure 0,6 1,5 1,2Government final consumption 1,7 1,2 1,0Gross fixed captial formation (GFCF) 5,5 6,5 1,6GFCF in machinery and equipement 10,5 8,3 2,0GFCF in construction 2,2 5,4 1,0Export (Mrd. EUR) 959.479 1.038.156 1.074.492 -Growth rate 13,7 8,2 3,5Import (Mrd. EUR) 806.164 864.208 903.097 -Growth rate 11,7 7,2 4,5GDP per Head (EUR) 30.554 Unemployment (in Mil.) 3,24 2,98 2,83Employment (change in thousand) 191 541 250

Germany at a glanceShare of Total GDP and Population in the European Union 2010

GDP (in EUR billion)

Share of Total GDP (EU-27)

Population (in million)

Share of Total Population (EU-27)

GERMANY 2.477 20% 82 16%France 1.933 16% 65 13%UK 1.697 14% 62 12%Spain 1.063 9% 46 9%Netherlands 588 5% 17 3%Poland 354 3% 38 8%Czech Rep. 145 1% 11 2%Slowak Rep. 66 1% 5 1%USA 10.957 309 Japan 4.122 128 EU-27 12.284 501 Eurozone 9.170 331

Germany at a Glance

Slovene German Business Relations

Key Sectors in Germany

How to Find a Partner?

2005 2006 2007 2008 2009 2010 2011

-1,000,000

0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

Export to GermanyImport from GermanyTrade Balance

Slovenian-German Economic Relations

German-Slovenian foreign trade balance (in 1000 EUR)

Quelle: Statistikamt Slowenien

Quelle: Statistikamt Slowenien

1000 EUR 2011 1000 EUR 2011

CountryImport share

(%) Import Country Export Export share (%)

Total 100 22.158.543 Total 20.477.552 100

Germany 18,84 4.174.078 Germany 4.387.773 21,43

Italy 18,29 4.052.888 Italy 2.470.512 12,06

Austria 11,72 2.596.669 Austria 1.704.945 8,33

France 4,76 1.056.066 France 1.402.855 6,85

Croatia 3,89 862.603 Croatia 1.375.565 6,72

Netherlands 3,28 727.570 Hungary 619.719 3,03

Serbia 1,87 414.888 Serbia 597.352 2,92

Russia 1,74 386.539 Russia 542.977 2,65

Market share of German federal states in Slovenian exports to Germany

Market share of German federal states in Slovenian imports from Germany

Quelle: Statistikamt Slowenien

Slovenian-German Economic Relations

18%

16%17%

5%

5% 8%

Baden-WürttembergBayernNordrhein-WestfalenHessenNiedersachsenNeue Bundesländer

31%

22%20%

5%7% 8%

Baden-WürttembergBayernNordrhein-WestfalenHessenNiedersachsenNeue Bundesländer

Germany at a Glance

Slovene German Business Relations

Key Sectors in Germany

How to Find a Partner?

Key Sectors in Germany

• Automotive

• Machinery & Equipment

• Metal and Metal Processing Industry

• Food & Beverage, Organic Food

• ICT Industry

• Energy & Environmental Industry

• Construction Industry

Emerging IndustriesEnergy Efficiency SectorCreating the Future for a Clean Environment

Industry & Market Numbers• market leader in energy efficiency

technologies• turnover of about EUR 67 billion per year• double-digit growth rates expected in coming

years• 1/3 of companies active in the sector realize

profit margins of over 10%• average workforce growth of about 15% per

year

• The construction industry is one of the most important sectors of the German economy

• Germany’s Construction Industry: Strong Growth Followed by Stagnation

• Construction Work on Existing Buildings Dominates• Total market volume: 312,7 bil EUR• Residencial construction: 179 bil EUR• Energy related modernization: 57,5%

Construction industry

Safety & Security Industry"Made in Germany" for Future Security

• Largest market in Europe• High market potential with industry turnover of 20.3 billion Euro in

2008• Industry forecast to record 55% growth by 2015• IT security will grow by 124% within the next six years• Identification, authentication, and biometrics revenue forecast to

increase by 87% by 2015• Market for protection technologies against theft, burglary, and assault

expected to grow by 33% through 2015• Record IT security hardware and software spending of 2.3 billion Euro

in 2008

Industry & Market Numbers

ICT Industry Germany's ICT Industry: Shaping Europe’s Digital Future

• Europe’s largest ICT market in terms of revenue volume (20 percent of total EU market volume).

• With 5.5% global market share, German ICT industry is ranked fourth worldwide.

• Turnover of EUR 137 billion• Germany’s ICT industry employs a workforce of around

850,000

Industry & Market Numbers

ICT Industry Germany's ICT Industry: Shaping Europe’s Digital Future

Cloud Computing: There is significant international demand for secure and cost-effective cloud solutions and services

Growth Areas

Smart Grids: Increasing importance of sustainable energy supply offer great opportunities for smart grid adoption and ICT solutions for smart grid.

IT Security: The market for IT security is growing due to steadily increasing risk potential

Automotive IndustryDriving Performance through Technology

• Europe's largest automobile market• 5.5 million passenger vehicles manufactured and 2.9 million

registrations in 2010• Average manufacturer and supplier turnover of more than EUR

300 billion • 30 final assembly plants with a production capacity of over one

third of total automobile production in Europe• The German auto industry invested EUR 19.6 billion in R&D in

2010 (a 3.1 percent increase on the previous year)• 3,650 patents per year (= 10 patents a day

Industry & Market Numbers

Market Potential• Germany has a very competitive auto parts market with

many domestic and foreign manufacturers

• Suppliers are mostly specialized

• New Automotive Deal

• Consolidation process-oriented sectors

• Just in Time Just in Sequence

• After sales market is expected to grow in the coming years

Automotive Industry

Automotive IndustrySmart MobilityElectric mobility is the technology of the future but existing technologies must be optimized

Opportunities for Automotive SuppliersThe demand for new technology for this market is enormous

Vehicle manufacturers require core components such as batteries and electric motors for electric.

Machinery & Equipment IndustryMarket Leadership Powered by German Engineering

• Annual turnover 173 billion Euro • Growth rates between of 7 and 12 percent• Domestic market: 87 billion Euro • Highly innovative sector producing 28% of the worlds

mechanical engineering patents• Technical fields with high import rates: drive technology

(10.7%), air technology (9.3%), valves and fittings (6.7%), construction equipment (6.2%)

Industry & Market Numbers

Machinery & Equipment Industry

• Imports: EUR39.1 billion in 2009

• One of the fastest growing industry sectors in Germany

• High domestic demand from industries like the automotive,

electronics, chemicals, food as well as the renewable

energies sector

• very attractive to foreign companies seeking to sell their

high-tech products and components abroad

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Market Potential

Metal & Metal Processing Industry

• Metal and metal products imports totaled EUR 68.7 billion in 2010

• Sixty two percent of the imported metal products came from the European Union

• In 2009, 15 million tons of steel were processed in the production of metal products

• The non-ferrous metal industry registered sales of EUR 43.5 billion in 2010

Industry & Market Numbers

Plastics IndustryGermany is Europe's No.1 Plastics Location

• Leadership in plastics production and consumption, export and import, and in investment in fixed assets and expenditure in R&D

• Turnover EUR 88 billion, 7,200 companies, 440,000 employees• About 70 application-oriented university and non-university

research institutes in the field of polymer and materials research in close collaboration with the plastics industry

• Over 40 regional plastics clusters, innovative networks and competence centers

Industry & Market Numbers

Electronics & MicrotechnologyYour Market for Next-Generation Technology

• Turnover of 165 billion Euro in 2010 • Market is estimated to grow to 180 billion Euro in 2011• Fourth largest industry segment in Germany by revenue (2010)• 12 billion Euro R&D expenses annually• Microelectronics is one of our fastest-growing industry sectors• market potential for automotive and industry electronics

Industry & Market Numbers

Energy & Environmental Technologies

Bioenergy Industry

Solar Industry

Wind Industry

Environmental TechnologiesClosed Loop Recycling and Sustainable Water Technologies

Environmental technologies is one of the most important economic sectors in GermanyTurnover: 85 billion Euro in 2008German World Market Share for Recycling Technology: 24% (Material Separation devices have 64% of the world market)More than 320,000 Employees

Industry & Market Numbers

Consumer Goods & RetailLarge Markets Create Major Opportunities

• Europe's leading consumer market with 82 million affluent consumers

• Private spending remained stable in 2008 at EUR 1,854 billion

• Private spending in the leisure and apparel segments is permentently growing due to higher private income

• Germany's consumer electronics market fasted growing segment

Industry & Market Numbers

Food & Beverage IndustrySupplying the Full Spectrum of Consumer Needs

• Germany is Europe's second largest food producer with sales of 149.5 billion Euro in 2010

• Germany is a net importer of food & beverage products• Largest sector sub-segments in 2009: meat (22.7%), dairy

(15.4%), confectionery food (9.4%), and baked goods (8.7%)• Major national and international players, including Dr. Oetker

Group, Südzucker AG, Vion Food Group, Kraft Foods Deutschland GmbH, Nestlé, etc

Industry & Market Numbers

Food & Beverage IndustrySupplying the Full Spectrum of Consumer Needs

• High demand for health and wellness as well as functional food products to prevent or overcome conditions including diabetes, high blood pressure and cholesterol

• Movement for organic food and “free of” foods e.g. lactose and gluten-free products

• Driving demand for highly convenient foodstuffs including ready-to-eat meals, frozen foods, desserts, and baked goods

• Ethnic foods, beauty foods and fair trade products

Market trends

• Large size of the German market in the food and beverage sector are very attractive to exporters worldwide

• German consumers are generally well informed. They expect high quality and low prices for their food and beverage products

Market Potential

Market Access

• The German food & beverage industry is highly fragmented and competitive.

• Exporting companies should be aware that product packaging is very important to German consumers since they are highly environmentally conscious

• Manufacturers, importers, distributors and retailers must make sure that their packaging materials for their food products comply with the EU's and Germany's domestic regulations in terms of recycling and disposal. There are several dual system companies licensed in Germany offering various waste disposal schemes

Germany at a Glance

Slovene German Business Relations

Key Sectors in Germany

How to Find a Partner?

Erfolgsfaktoren auf ausländischen Märkten

Produktqualität

Wahl der richtigen Partner auf dem globalen Markt

Gute Kontakte/Netzwerke

Service

Umfassende Marktkenntnisse

Preis- Leistungs- Verhältnis

Technologischer Vorsprung/ FührungKonkretes wirtschaftliches Konzept für den Zielmarkt

Verlässliche Geschäftspartner

Finanzierung????

Sales in Germany

Marketing-Mix

Quelle: AHK

Marketing Tools Very important Less important unimportant

Fairs 63 28 9

Presentations 62 29 9

Fact-Finding Missions 61 29 10

Brochure / Catalogs 43 47 10

Direct Marketing(Mailing) 33 45 22

e-marketing 26 49 25

Advertisement 24 51 25

Retail and Wholesale

Distribution channels vary considerably depending on product and industry

Line of Business Recommendation

textile industry Agents

food and beverage Wholesale, agent

metal products, automotive, mechanical engineering Direct Sales, agent

automotive, mechanical engineering Subsidary

How to find a partner?

The German Chamber Network

"AHK – well connected worldwide"

How to find a partner?

AHKs as official representation of German industry and commerce

"AHK – well connected worldwide"

AHKs as member organizations

AHKs as service providers to companies

How to find a partner?

AHK Slovenia – Your bridge to the German Market

We… Provide information Solve problems Offer service Establish contacts

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Market entry to Germany

International matchmaking eventsAddress research

e-trade-center.com

Investing in Germany

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Market Information

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Online Marketplaces

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Legal and tax servicesInformation about German companies

Debt collection in Germany

Legal information about Germany

Commercial agentsEmployees

Starting a business in Germany

Tax services for Germany

German VAT returnsReclaim of German VAT

Our Partners in Germany

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The BGA, the Federation of German Wholesale, Foreign Trade and Services, is the leading organization for the wholesale, foreign trade and service sector in the Federal Republic of Germany.

National Association of German Commercial Agencies and Distribution

VBIGerman Association of Consulting Engineers

Quelle: Austellungs- und Messeauschuss der Deutschen Wirtschaft

The AHK Slovenija website should be your first stop when looking for information on trade shows in Germany

www.dihk.si

One of the most important marketing tools are fairs and exhibitions

Information CenterDo you have further questions about the German Market? Contact us directly. We will be glad to answer your questions.

Gertrud Rantzen Predsednica

Telefon: +386 252 88 63 E-Mail: gf@ahkslo.si http://slowenien.ahk.de