Complete guide to doing business in Spain in 2026, for growing startups and entrepreneurs

Trying to crack the Germany market from the UK? It’s a smart move, but Germany can be a lot of work if you aren't prepared.

This guide covers the opportunities and challenges of doing business in Germany, plus practical setup tips. And when it’s time to invoice in EUR, pay German suppliers, and keep FX costs visible, Wise Business helps UK firms stay in control.

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Why expand business to Germany?

There are lots of reasons why UK businesses choose Germany in which to expand their operations. From its accessibility to Europe, an advanced workforce and support for innovation, we’ll explore these opportunities in more detail below.

A large market with EU reach

Germany has a population of about 83.5 million, which is a lot of customers, users, and procurement teams in one place. For many UK companies, it’s also a strategic base for wider EU growth once the model works.¹

Cross-border momentum is often won or lost in finance ops. Being able to receive EUR, pay in EUR, and separate German cash flow from UK cash flow makes expansion feel less like “international” and more like business as usual.

Large economy with growing investment

Germany’s economy is built on serious industry, which can be great news for UK companies selling specialist services, components, or software. Germany Trade & Invest flags strong UK interest post‑Brexit in sectors like software, fintech, and digital health.²

Germany is Europe’s largest economy by GDP and market size. The German government is embarking on a major transformation driven by massive public investment in infrastructure, energy, digitization, and defence. They are working to ease bureaucracy and make it even easier to get a business up and running.

Access to a skilled workforce

Germany combines technical talent with a reputation for structured training and professional standards. Unemployment was 3.4% in 2024 (World Bank), which suggests competition for hires in many fields.³

That can be a positive for quality, but it can stretch timelines and budgets. Build a hiring plan early, include local HR support, and assume your first hires will care about process, contracts, and clarity as much as pay.

Clear rules, strong institutions, and support for innovation

Germany is known for stability and predictable processes, even if they can feel bureaucratic. For innovation-led firms, Germany’s R&D tax credit (Forschungszulage) is one incentive to explore. The OECD lists a 25% rate, with SMEs able to apply for 35%.⁴

In practice, the wise approach is to treat Germany like a long game. Invest in compliance, document decisions, and choose tools that keep costs transparent, especially for cross-border payments, currency conversion, and recurring supplier invoices.

💡 Read our international expansion checklist

Challenges of doing business in Germany

Germany can be an excellent place to grow, but it expects preparation. The main roadblocks tend to be admin, compliance detail, and the practicalities of operating in EUR while the home base still runs on GBP.

Complex set up with more demanding admin

Company formation and registrations can involve several steps, and some requirements are handled at municipal level. Germany Trade & Invest describes clearly defined steps for setting up, but it still pays to build in extra time for approvals and documentation.²

If the plan is to expand business in Germany quickly, avoid procrastination with admin. Delays often land at the worst moment, such as when a major customer is ready to sign or a hire needs payroll set up.

Higher employment costs

Germany’s talent can be a big advantage, but employment rules and employee protections are robust. Contracts, notice periods, and benefits are typically treated as standard, not negotiable afterthoughts.

For UK firms, the practical challenge is speed. Hiring, onboarding, and payroll setup can take longer than expected. Budget for professional advice, and write job specs that are specific enough to attract the right candidates.

Tax, invoicing, and reporting can feel unfamiliar

Corporate tax can vary by municipality, and VAT treatment depends on what’s being sold and to whom. Even experienced finance teams can stumble over invoice requirements, language expectations, or local reporting norms.

A simple way to reduce risk is to standardise processes early. Use consistent invoice templates, keep evidence for cross-border transactions, and avoid mixing UK and German books in ways that make reporting harder later.

Language and localisation can be a commercial requirement

Many German teams speak excellent English, but contracts, customer comms, and technical documentation often land better in German. If your product touches regulated areas, German-language documents can move from a nice-to-have to being absolutely essential.

This is also a brand signal. Localisation shows commitment, which can help sales cycles. It’s one of the quieter ways to build trust when competing against suppliers already embedded in the market.

Post‑Brexit mobility and services rules add extra steps

UK firms sending staff to Germany, or delivering certain services, may face additional requirements after EU exit. The UK government publishes specific guidance on providing services and travelling for business to Germany and the wider EU.⁵

There could be issues such as: getting an authorisation or getting a licence to provide a service; complying with local business regulations; obtaining the correct visa, work permit or other documentation. It’s also vital to find out if EEA nationality requirements could prevent you from providing services in some sectors.

Don’t leave this to the week before a client visit. Check rules early, especially for regulated services, longer stays, or projects that look like practical work rather than meetings and conferences.

💡 Learn more about navigating risks of international expansion

How to set up a business in Germany?

If you're thinking of starting your own new business venture in Germany, then there’s a few things to know to get started. We’ll walk through how to start a business in Germany, the costs involved and why doing business in Germany could give your UK business a boost.

• Choose your route - sell cross‑border, open a branch, or form a local entity such as a GmbH or UG. You might find our guides on starting a business in Germanyand how to open a branch office helpful.
• Pick a location and confirm local requirements with the relevant trade office (Gewerbeamt) Some steps are municipal, so requirements can vary depending on where you register
• Prepare core documents and plan for any notary steps - entity type, shareholders, and governance choices affect paperwork, costs, and timelines
• Register for tax and VAT handling where relevant. for example, looking into Germany's corporate tax
• Open a business account that can handle EUR properly. It’s worth having a read on how to open a business bank account in Germany from the UK
• Set up invoicing, bookkeeping, payroll, and supplier payments before you scale - smooth finance ops help you hire faster, pay suppliers on time, and look credible to buyers

💡 See our full guide to full guide to starting a business in Germany 🇩🇪

What cities and areas in Germany are best for businesses?

Berlin

Berlin leads Germany’s startup scene and is ranked 14th globally by StartupBlink. Berlin’s ecosystem is significantly stronger than Munich’s, which hints at the concentration of founders, talent, and startup services.⁶

For UK startups, Berlin can be a good launchpad for partnerships and early hires. The trade-off is competition. Expect strong candidates to have options, and plan a clear employer brand and compensation strategy.

Munich and Bavaria

Munich is associated with B2B, hardware, and industrial innovation. If your offer targets engineering-heavy sectors, enterprise buyers, or high-value manufacturing supply chains, Munich can be a strong fit.⁶

Costs can be higher, but so can deal sizes. A wise approach here is to align overheads with sales strategy, and avoid committing to an expensive footprint before the pipeline proves it can carry it.

Hamburg

Hamburg benefits from its role as a major port and trading city. For companies shipping goods, managing supply chains, or selling into Northern Europe, Hamburg can reduce operational friction.⁶

It can also work well for ecommerce and consumer brands that need dependable fulfilment routes. Pairing a Hamburg base with EUR collections and EUR supplier payments can help ensure the smooth running of business.

Business etiquette and culture in Germany

There’s quite a distinction between UK and German business cultures. The UK tends to favor relationship building, with notes of informality. Whereas in Germany, business is more formal and direct.

Here are some considerations below to be aware of:⁷

• Business culture in Germany tends to be punctual, structured, and direct
• Meetings often follow an agenda, and decisions are typically backed by written detail
• If you arrive prepared and follow through, relationships can build quickly
• Formality is common early on, including titles and surnames until invited otherwise
• Written follow-ups are appreciated, and clarity and precision are vital
• Shaking hands is also another vital feature in Germany’s business culture, for example, in your first time meeting any clients, colleagues or employers
• For best practice, if you aren’t sure - always offer a handshake
• Compared to other cultures and countries across the world, Germany operates with a strong sense of fairness and has an ethos of equality, good working conditions, and integrity
• In business dealings, you’re more likely to expect compromise versus one party forcing their own agenda

Tips for doing business in Germany

Have a robust international payment system in place

Many expansion plans look great until the first invoice is sent, paid late, or paid with unexpected fees. Before signing major contracts, test your end-to-end flow: quoting in EUR, invoicing, receiving EUR, and reconciling payments cleanly.

Quoting in GBP while paying German suppliers in EUR can expose you to FX swings and hidden spreads. Pricing in EUR where possible can make costs and profit clearer, especially for repeat contracts and subscription billing.

Wise Business can support EUR workflows alongside GBP, so finance teams can track German revenue without month-end close being unnecessarily complex. It’s a small operational win that can protect bigger commercial wins. Wise Business also shows the mid-market exchange rate and Wise’s fee separately, so businesses can see what they’re paying for conversion. That visibility makes it easier to compare options and keep pricing decisions grounded.

Prioritise Compliance early

Compliance isn’t exciting, but it can be expensive when it’s late. Confirm which registrations apply, how VAT should be handled, and what invoice details German customers expect. Then lock it into templates and checklists.

If your team uses multiple tools, align them early. A consistent process across sales, finance, and operations reduces rework and supports growing business in Germany without constant debate around how things are done.

Build strong business relationships

As direct communication, punctuality and integrity are all foundational to Germany’s business culture, it’s crucial to demonstrate trust from the start of all client, supplier, or employee relationships.

Supplier relationships are easier when payments arrive as expected and fees don’t get shaved off along the way. Plan how you will pay German suppliers in EUR, and keep arrival times and payment references consistent. This is a quiet but core way to build trust in the German market.

Don’t underestimate localisation in sales and support

Even when buyers speak English, German-language pages, contracts, and help articles can increase confidence and reduce friction. Localisation also improves all channels of marketing, which matters if your growth channel includes inbound leads.

This doesn’t mean translating everything on day one. Start with the high-impact pieces: pricing pages, core contracts, onboarding emails, and support paths linked to your highest-value products.

💡 You may also like: Germany's Freelance Visa

Grow your business in Germany with Wise Business

Expanding into Germany gets easier when money moves with the same discipline as your plan. Wise Business helps UK companies manage EUR revenue, pay German suppliers, and keep FX costs transparent as they scale.

Wise Business lets businesses hold and convert between 40+ currencies using the mid-market exchange rate, with fees shown upfront so quotes and budgets are easier to defend. You can also receive payments with local account details in 8+ currencies, which helps German customers pay in EUR like they would a local supplier via getting paid or receiving money.

Add international payments for suppliers and partners, and the Wise Business card for travel and team spend across 150+ countries, and the Germany setup starts to feel seamless.

If the goal is to grow business in Germany without losing margin to avoidable costs, start with the account built for cross-border work.

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*Disclaimer: The UK Wise Business pricing structure is changing with effect from 26/11/2025 date. Receiving money, direct debits and getting paid features are not available with the Essential Plan which you can open for free. Pay a one-time set up fee of £50 to unlock Advanced features including account details to receive payments in 22+ currencies or 8+ currencies for non-swift payments. You’ll also get access to our invoice generating tool, payment links, QuickPay QR codes and the ability to set up direct debits all within one account. Please check our website for the latest pricing information.

FAQs

What are the biggest pros and cons for doing business in Germany for UK companies?

Pros include a large customer base, strong B2B demand, and a reputation for quality and long-term supplier relationships. Cons often include heavier admin, detailed compliance, and the practical challenge of operating in EUR while managing UK reporting in GBP.

Is Germany a good place to set up a company after Brexit?

It can be. Germany Trade & Invest reports increased UK company interest in Germany post‑Brexit, partly to maintain EU market access. The best approach depends on whether you need an EU entity, local hiring, or local contracts.²

What should UK teams know about business etiquette in Germany?

Expect punctuality, structure, and direct communication. Agendas, written follow-ups, and clear deliverables matter. Early interactions can be formal, so default to professional titles and clarity until the relationship naturally relaxes.

Sources used

1. German Federal Statistical Office (Destatis) — Current population of Germany
2. World Bank — Germany data (GDP, population, unemployment, etc.)
3. Germany Trade & Invest (GTAI) — Beyond Brexit: Expanding to Germany
4. OECD (INNOTAX / STIP) — R&D tax credit (Forschungszulage) details (Germany)
5. GOV.UK — Providing services and travelling for business to the EU/EEA/EFTA
6. StartupBlink — Germany startup ecosystem + top startup cities rankings (Berlin, Munich, Hamburg)
7. Expatrio - German Business culture

Sources last checked: 05-Mar-2026