SME's in Germany: Interesting Facts & Statistics!

Hi everyone, todays article is about SME's in Germany, in this article I have provided market share of each SME globally or domestically in Germany, along with their profit margins and if you are looking to invest in its franchises or want to become dealer, I have provide initial investment where I could in numbers or in range of significant, moderate, low range where I couldn't find the numbers.

Before going for the main topic of this article, I would like to share some interesting facts and statistics about German SME's below.

Interesting Facts & Statistics About SME's in Germany:

•     According to the Federal Statistical Office of Germany, as of 2020, there were around 3.5 million SMEs in Germany, accounting for over 99% of all businesses in the country.
•     SMEs are responsible for providing around 60% (18.4 million) of all jobs in Germany, making them a significant contributor to the country's economy.
•     The average turnover of SMEs in Germany is approx. 2.32 bn € in 2020, which represents 33,7% of the total turnover of German enterprises., an average of 7.6 people are employed by each SME, almost double the EU average for SMEs.
•     Around 90% of SMEs in Germany are family-owned businesses, highlighting the importance of family ties and traditions in German culture.
•     According to the World Bank collection of development indicators, compiled from officially recognized sources, the number of new businesses in the country has been increasing in recent years, with over 72774 new businesses founded in 2020 alone.
•     SMEs in Germany are particularly strong in the manufacturing and engineering sectors, with companies such as BMW, Siemens, and Bosch all starting out as small businesses.
•     According to a report by Organisation for Economic Co-operation and Development (OECD) for the European Commission, overall, about 42% of the German population reported about having entrepreneurship skills..
•     The COVID-19 pandemic has had a significant impact on SMEs in Germany, with many facing financial difficulties due to reduced demand and supply chain disruptions. Companies lost an average of 46% of their normally anticipated turnover. Overall, SMEs lost around EUR 88 billion in May. However, government support measures such as loans and grants have helped many businesses to stay afloat during these challenging times.
•     The German government has also introduced several initiatives aimed at promoting innovation and digitalization in SMEs, recognizing the importance of these factors in maintaining the competitiveness of businesses in a rapidly changing global economy.
•     In general, SMEs in Germany are seen as playing a crucial role in driving economic growth and innovation in the country, and are likely to continue to be a key part of the German business landscape in the years to come.

Okay Let's now get to the main topic of this article (smiles)

List of 30 Famous SME's in Germany

Okay here are 30 famous SMEs in Germany with their market share, profit margin, and required investment to start:

    Aldi: Supermarket chain with a market share of around 30%, profit margins of around 2-3%, and currently the company is not offering any franchises except for shop locations so if you think you have the right place that fulfills Aldi criteria, you may get the business (like charging good healthy amount in rent), for more details on Aldi please check out this link.

Aldi enjoys a diverse customer base with majority comprising of middle-income households with 53.8% of the customer base belonging to €25,000 to €79,999 income bracket.

    Lidl: Supermarket chain with a market share of around 9%, profit margins of around 2-3%, and a significant investment required to start a franchise.

Lidl is the second largest chain of discounter supermarkets in Germany and is part of the Schwarz group. In 2021, Lidl had 3,242 branches.

    Adidas: Sportswear company with a market share (in footwear wholesaling) of around 9.1% of total industrial revenue, profit margins of around 8-10%, and a significant investment required to start a franchise.

German sportswear manufacturer Adidas' sales increased 11 per cent to €6.408 billion in Q3 2022 in euro terms.

    Puma: Sportswear company with a market share of around 5%, profit margins of around 8-10%, and a significant investment required to start a franchise.

Footwear sales accounted for 46.5 percent of Puma's sales (world wide) in 2021, the largest share of the sportswear company's three product segments.

Share of Puma's net sales worldwide in 2021, by segment.

Characteristic          Sales share

Accessories              16.5%

Apparel                        37%

Footwear                       46.5%

    Hugo Boss: A fashion company; in 2019, 23 percent of Hugo Boss' European sales were generated in Germany. In that year, Hugo Boss generated sales of approximately 1.8 billion euros in Europe., the  profit margin in this business is around 10-12%, and a significant investment required to start a franchise.

    Siemens: Engineering and technology company with a market share of around 10%, for their dealers the profit margins varies between 8-10%.

As of February 2023 Siemens has a market cap of $127.81 Billion. This makes Siemens the world's 101th most valuable company.

    BMW: Automotive company with a market share of around 8%, among the Luxury brands, BMW offers the highest dealer margin of 5.71 to 7.49 per cent.

BMW opens and manages their car dealers directly at the moment. There is no possibility for any third-party investors to get into the business unless he or she is not hired by the company. 

    Mercedes-Benz: Automotive company with a market share of around 9.4%, profit margins of around 8-10%, and a significant investment required to start a franchise.

A franchise fee of about $35,000 is required at the start. These are just the costs of equipment, not the money spent on building space and inventory. A franchisee will spend more than $150K to become a franchisee after all the requirements are met.

    Allianz: Insurance company with a market share of around 24%, net profit margins of around 2-3%.

    Deutsche Bank: Banking and financial services company with a market share of around 12.77% (domestically), net profit margins of around 10.56%.

    Commerzbank: Banking and financial services company with a market share of around 5.08% domestically, operating margins of around 21%.

    SAP: Software company with a market share of around 2.38%, profit margins of around 10-12%, and a significant investment required to start a franchise.

    Henkel: Chemical and consumer goods company with a market share of around 5%, profit margins of around 10-12%.

    DHL: Logistics company with a market share of around 57%, net profit margins of around 2.6%, and a just about $10k investment required to start a franchise.

    Deutsche Post: Postal services company, during 2021, the company generated over 6.7 billion euros in revenue from its parcel business services in Germany, profit margins of around 2-4%, and a significant investment required to start a franchise.

    Fielmann: Optical company with a market share of around 50%, profit margins of around 8-10%.

    TUI: Tourism company with a market share of around 17.9%, profit margins of around 5-7%.

    Fraport: Airport operator with a market share of around 50%, profit margins of around 10-12%.

    Continental: Automotive and technology company with a market share of around 4%, profit margins of around 8-10%.

    Osram: Lighting solutions company with a market share of around 5%, profit margins of around 8-10%.

    Leica: Camera and optics company with a market share of around 0.5%, profit margins of around 10-12%.

    Miele: Home appliances company with a market share of around 5%, profit margins of around 5-7%.

    Vaillant: Heating and cooling systems company with a market share of around 3%, profit margins of around 5-7%.

    Würth: Wholesale company with a market share of around 2%, profit margins of around 8-10%

    Deichmann: Shoe retail company with a market share of around 10%, profit margins of around 5-7%, and a moderate investment required to start a franchise.

    Douglas: Beauty products retail company with a market share of around 2%, net profit margins of around 8% in 2023, and a moderate investment required to start a franchise.

    Rossmann: Drugstore retail company with a market share of around 20%, profit margins of around 2-3%, and a moderate investment required to start a franchise.

    Thalia: Bookstore retail company with a market share of around 10%, profit margins of around 3-5%, and a moderate investment required to start a franchise.

    Sixt: Car rental company with a market share of around 10%, profit margins of around 5-7%, and a moderate investment required to start a franchise.

You will be required to pay Sixt an initial franchise fee ranging from € 20,000 to € 500,000 depending on the size and market volume of your country.

    A.T.U: Automotive maintenance and repair company with a market share of around 5%, profit margins of around 2-3%, and a moderate investment required to start a franchise.

Please note that the market share, profit margin, and required investment can vary depending on different factors such as location, industry, and competition. These are general (educated guess) estimates and may not be completely accurate for each individual franchise opportunity.

That's it, over to you guys!

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