Germany ranks as the top investment location in Europe and creating a large customer base for investors. Germany’s integration into the world economy offers companies numerous opportunities within a global network. One in ten entrepreneurs in Germany is a foreigner, and a growing number of foreign investors are setting up their own firms to realize their business idea. 

Germany’s steadily growing purchasing power make it especially attractive for foreign investors who view franchising as an effective way of expanding their operations, along with raising their revenues. Hence, German franchising industry has been growing more rapidly than the overall economy for years. The overall turnover generated by the German franchising industry is expected to grow at a rate of 5 percent annually. The fields of home services (including care and nursing homes), education, and health care offer huge opportunities for growth.

Germany’s largest population and strongest hub for business, North Rhine-Westphalia (NRW), is inviting the most foreign investment of all German states. Düsseldorf, capital of NRW, includes almost 150 million people within a 500-km radius, representing nearly 45 percent of purchasing power in the EU.

There are a number of approaches to establishing a foreign franchising system in Germany, depending on the products or services offered and the franchisor’s business strategy. For the franchisor, when implementing a new franchise concept, a key factor for success is to conduct the right market entry strategy carried out by a capable master franchisor who would be looking out for additional potential franchisees.