Article from Metalworks - Spring 2018
The German metal and machinery industry is experiencing growth in exports, and it is an important market for Danish subcontractors. This gives rise to positive expectations at the Danish-German Chamber of Commerce, which predicts that Danish exports to Germany will increase by 5% in 2018. According to the Export Association, you must be able to adapt your solution to German customers if your company wants to share in the potential.
"In Germany, you compete with both German and foreign manufacturers in all industries. Therefore, you need to be aware of the difference you can make for your customers and how your company differs from the competition," says Reiner Perau, CEO of the Danish-German Chamber of Commerce, and continues: "However, it can be difficult for smaller Danish industrial companies to deliver the large volumes that German companies require. Therefore, you should focus on becoming a subcontractor to medium-sized German Mittelstand companies that buy smaller volumes."
Explore the opportunities on the market
Germany is an attractive market for Danish companies because it is large and growing relatively fast compared to other mature economies in Western Europe. At the same time, it is a market where there is still a large untapped potential for Danish companies. "We are seeing a growing interest in Germany among our members. Many have started selling to the German market, but have far from exhausted the opportunities. But with political and economic stability, more Danish companies are taking another look at the market and are now also moving south of northern Germany," says Ulrik Dahl, CEO of the Danish Export Association. "Danish competencies with innovative and customized solutions address Germany's need to automate and streamline production due to a shortage of skilled labor," he emphasizes.
Be ready to invest in the future
One of the Danish companies that has been successful in the German market is NTF-Aalborg A/S, which supplies stainless steel equipment to the food and pharmaceutical industries. Key Account Director Jørgen Ravn has found it challenging to find the right sales structure in the German market. "We have learned that it's about researching the market, preferably through export support programs, and then taking one bite at a time instead of trying to service all of Germany from the start," he says and elaborates: "When you enter a new market, it is an investment in the future because it may take several years. That's why it's important to say at management level that we are ready to invest the resources, time and money needed to be properly prepared."
NTF-Aalborg A/S
NTF-Aalborg A/S is a leader in innovative processing of customized solutions in stainless round steel, wire mesh and wire products for the food and pharmaceutical industries.
Target your efforts on the market
In order to devour the market in smaller chunks, NTF-Aalborg A/S has divided the German manufacturers into A, B and C customers on the basis of activity and turnover potential. In addition, the company has hired an external sales employee to handle the dialog with customers. "An importer can sell your standard products, but products that require more advice, such as customized solutions, are best handled by the company's own external sales employee, because they require greater technical insight," says Jørgen Ravn and elaborates: "Our sales employee visits the German A and B customers two to six times a year, while contact with C customers is handled by email or telephone. As a rule, the purpose of the visit is target management, follow-up on specific needs and inquiries, which result in offers that must be followed up regularly to turn into orders."
The Export Association and the Danish-German Chamber of Commerce
The Danish-German Chamber of Commerce is a network organization that advises companies on the German market and has more than 600 members. The export association represents more than 600 Danish small, medium and large export companies, which are grouped in 13 networks according to customer segments abroad.