Appreciated worldwide, Made in Italy is synonymous with quality, safety and aesthetics: these are the characteristics that have made any product made in Italy recognizable all over the world. And among the countries that seem to appreciate Made in Italy the most is Germany. From the most recent data, published by the Ministry of Foreign Affairs and International Cooperation, indeed, it emerges how Italian products are experiencing a “new golden age” in the German market.
This is no small factor: in the current macroeconomic environment of strong inflationary pressures on commodity price levels, and disruptions in the supply chain, finding a market with high profit potential like Germany may be the winning move in this 2023 for companies in the Belpaese.
Therefore, in this article we will analyze the latest trends of Made in Italy in Germany, and then move on to study the most successful sectors for the German market. Finally, we will review everything you need to export Made in Italy to Germany, between new packaging rules and required documentation.
Italy and Germany are two founding countries of the European Union, and as such share many elements, both historical and cultural. In addition to both belonging to the Eurozone and adhering to the NATO agreement, cooperation between the governments of the two countries are very intense, with interests and views often coinciding on many issues.
For these reasons, Germany has for several years been the leading trading partner for Italy: In detail, it is the top destination market for Italian exports, while Italy is the sixth largest destination market for German exports. And on closer inspection, trade interchange, That is, the cross-border import and export between Italy and Germany, Has grown steadily from 2015 to the present, as well as Made in Italy exports.
Indeed, looking at the graph below, it can be seen that trade in 2015 was worth about 108 billion euros; a value that has risen to 140 billion euros in October 2022. A figure, that of 2022, which is thus destined to surpass the maximum recorded in 2021, and which signals that Covid-19 (“only” 117 billion euros in 2020) is now just a memory.
Similarly, Made-in-Italy exports to Germany have also grown significantly in the past 7 years, rising from about 50 billion euros in 2015 to 65.2 billion euros in 2022 (considering the period from January to October).
Data that therefore leave room for little interpretation: Made in Italy in Germany is increasingly appreciated, and Exporting to the German market is the strategy adopted by many Italian companies to increase their turnovers and profits.
But what are the sectors in which to export Made in Italy to Germany? Analyzing the data published by the Ministry of Foreign Affairs, we can make a real ranking of the most promising sectors for Italian exporting companies.
In detail, metals and metal products sector is the one that occupies the first position, with 13 billion in exports between January and October 2022, thus accounting for 20.2% of total Made in Italy exports.
In second place we find machinery and equipment for industry, which with 8.2 billion euros accounted for 12.7% of total Italian exports. Closing the podium is the transport equipment sector and the’automotive, with 7.1 billion euros in value (11% of the total), but excellent prospects are also offered by the’food and beverage industry ($6 billion), and industry pharmaceutical chemistry tied with the fashion and clothing (4.8 billion euros each).
The presence of Italian companies exporting to Germany is therefore an established factor: whether they belong to the fashion, food or mechanical engineering sectors, their participation in the economic life of the German market, both B2B and B2C, is generally highly valued.
As mentioned in the previous paragraphs, there is a great correlation between Italian and German companies, especially with regard to the industrial realities of northern Italy: just think of the Italian components found in German cars and in aerospace production. Precisely the Proximity to the Austrian and German markets, facilitated the trade exchange and economic prosperity of several Italian companies, both large and small and medium-sized.
In addition, Made in Italy in Germany expressed particularly through the 3Fs (Furniture, Fashion, Food) is much loved, partly because it often evokes positive cultural and landscape assonances that the German consumer is also familiar with due to a well-developed tourism tradition.
But what might be examples of Italian companies exporting to Germany? We can find countless examples: thinking of large Italian companies, we cannot ignore the deep-rooted presence on German soil of Italian food companies such as De Cecco or Barilla, as well as the entrenched presence of Italian banks such as Intesa San Paolo or Unicredit.
Not to mention the numerous small Italian companies, that indeed represent the majority of Italian companies exporting to Germany. To give a few examples, the Octagona team accompanied to Germany Mojito Design, a company specializing in the production of plastic and rubber items, Genesis Electronics, an Italian company engaged in the production of LED technology, or Rinaldi Brothers, a company that manufactures aluminum processing machinery.
Generally speaking, no specific documents are required to export Made in Italy to Germany, although the assessment must be made on a case-by-case basis.
In fact, being part of the European Union, Germany does not require payment of customs duties, or specific documentation of conformity of goods. An export to Germany can therefore take place with peace of mind, as if it were a sale on the Italian market.
Be careful, however, because although this is the general rule, in some cases specific documents are required!
For example, in the case of exporting products containing alcohol (thus also simply Made in Italy wine), excise duty documentation is required. For this reason, it is necessary to consult with the importer to understand the specific requirements and who will take charge of such documentation.
Last but not least, starting from 2022, a new law has been introduced that needs the utmost attention, viz. LUCID regulations on the packaging that is used in shipping.
Octagona devoted an entire article on this issue, which summarizes the specific requirements of the German country and can be used as a guide for Italian companies to avoid heavy penalties and even a ban on trading on German soil.
In short, all transport packaging is to be registered with the Lucid portal of the Central Packaging Register Zentrale Stelle Verpackungsregister. Companies that fail to comply with the new regulations are at great risk: they are in fact provided for both a ban on sale in Germany and fines of up to 200,000 euros.
For more information read the full article on the New export rules on packaging in Germany.
What about VAT?
Again, the answer is depends: it is necessary to understand whether sales take place between companies and or between companies and individuals. An excellent guide in this regard is the European community guide on cross-border VAT.
That said, advise the company intending to export to Germany to contact Octagona by contacting our internationalization experts: Octagona's specialists also work alongside Italian companies on these sensitive issues to enable smooth management of all aspects of Made in Italy exports to Germany.
As seen, exporting to Germany has enormous advantages for Italian companies interested in expanding their horizons and accelerating their growth process. But, in fact, How to go about exporting to Germany?
The options available to businesses are many, but According to Octagona only 3 can really make a difference And we present them below:
- Online sales via marketplace or e-commerce: is definitely the cheapest option, as it avoids the physical component of doing business abroad, such as transfers or costs for a network of agents, participation in trade shows, or a direct physical presence with a subsidiary. It is a suitable solution for those who want to probe the German market without having to spend excessive resources and time, but with the major disadvantage of having to wait a long time to see results;
- Relying on a Temporary Export Manager: With a somewhat more challenging, but still limited budget, SMEs can achieve great results by relying on a Temporary Export Manager (TEM). These are professional figures or companies of international trade specialists who work directly on the German territory, and act as the company's interface in Germany. In other words, the figure functions as a hybrid of foreign salesperson and commercial agent, who for a limited time (usually at least a year) works on the company's business development.This is an extremely flexible solution that is perfect for companies that want to start an internationalization process;
- Physical presence: this is the most economically demanding solution, but also the one that guarantees the greatest results. It is suitable for medium- or large-sized companies, or at any rate of companies that can dispose of a large amount of capital: the activity begins with frequent trips and trade missions to Germany, and then culminates in a full-fledged company formation abroad, with its own office and its own dedicated resources.
Made in Italy continues to be a driving factor in Germany. Despite recent developments in the macroeconomic and geopolitical environment, which is characterized by numerous uncertainties, our country's trade relationship with Germany is steadily growing.
The numbers presented show how Made in Italy is experiencing a golden moment in Germany. Italian products are attributed positive characteristics such as versatility, high quality, and unique design that is inimitable in the rest of the world, and harnessing this traction is a necessary condition for creating a competitive advantage for your business.
Internationalizing in Germany may therefore be the winning choice in 2023 to reinvigorate the future of your business-an almost obligatory path for the chance to consolidate your growth path both in terms of profits and brand recognition.
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