The little 1x1 in dealing with German and Ukrainian business partners

This article explains:       

  1. OPPORTUNITIES AND CHALLENGES FOR UKRAINIAN COMPANIES ON THE GERMAN MARKET

  2. CRITERIA FOR A SUCCESSFUL PARTNERSHIP

  3. CULTURAL STRUCTURAL AND BUSINESS DIFFERENCES BETWEEN GERMAN AND UKRAINIAN BUSINESS PARTNERS

  4. DIFFERENCES IN BUSINESS CULTURE WITH POTENTIAL FOR IMPROVEMENT

  5. ETIQUETTE IN DEALING WITH UKRAINIAN BUSINESS PARTNERS - SUMMARY

 

1. OPPORTUNITIES AND CHALLENGES FOR UKRAINIAN COMPANIES ON THE GERMAN MARKET

The German market offers opportunities from the perspective of Ukrainian companies, here are the most important ones:

  • Strong and global economic interdependencies;
  • Favorable credit resources;
  • High purchasing power of consumers;
  • Access to the European single market;
  • Stable economic development.

On the other hand, Ukrainian companies in Germany also face various challenges. The most important of these include

  1. Language barrier: German is the predominant language in Germany. And although many people speak English, the language barrier can make business transactions difficult, especially in areas where direct communication with customers or business partners is required.
  2. Cultural differences: Germany has its own cultural norms and business practices that differ from those in other countries.
  3. Bureaucracy and regulations: Germany has a complex system of regulations and bureaucracy that can make it difficult for foreign companies to adapt and operate effectively. This applies in particular to areas such as taxes, labor law and certification.
  4. Competition: The German market is often highly competitive, especially in sectors such as the automotive industry, technology and mechanical engineering. Ukrainian companies may have to compete with well-established German companies that have many years of experience and a strong network.
  5. Consumer preferences: German consumers have specific preferences and expectations for products and services. Ukrainian companies may need to adapt their products and marketing strategies to meet these preferences.
  6. Logistics and distribution: Challenges to the logistics infrastructure and distribution can vary depending on the industry and region. In general, it can be said that some important points should be taken into consideration:
      • Delays at borders due to security checks, bureaucracy or staff shortages.
      • Complex customs processes, especially for dual-use goods or war-related products.
      • Different certification and documentation standards.

Choosing the right market entry strategy is crucial for success. This can be the establishment of your own branch, cooperation with local partners or the use of distribution channels. Careful market analysis and targeted preparation help to overcome challenges and exploit opportunities.

2. CRITERIA FOR A SUCCESSFUL PARTNERSHIP

Potential partners and buyers do not have a deep understanding of your company, its history, its know-how, its philosophy, its relationships with stakeholders, owners and suppliers, which are so important for building trusting partnerships. In short, the key to business is to be where your customers and partners are. Every new partnership is a blank slate with many unknowns. This is why there are prejudices and understandable doubts when it comes to assessing the risk of business relationships between German and Ukrainian partners. A distinction must be made between national factors that apply to the country as a whole and those that are specific to a particular provider. National factors include economic stability, inflation, development dynamics, legal regulation of customs, including customs and payment transactions, etc. Specific ones that are peculiar to a particular company.  From the point of view of partners and customers in Germany, cooperation with Ukrainian suppliers is associated with

  • Greater need for coordination and agreement due to the distance to the supplier.
  • Time factor. If delivery times are tight, delays are more likely than when working with local suppliers.
  • Need for more planning and control. More transparency requires more time and more reporting.   
  • Significant administrative and customs barriers compared to local suppliers.
  • Legal, linguistic and cultural differences that can lead to misunderstandings and the escalation of conflict situations.

The above points show that you need to actively communicate with your Ukrainian partners in order to build an image of trusting relationships.   

3. Cultural, structural and practical business differences between German and Ukrainian business partners.

German entrepreneurs notice a number of cultural, structural and practical business differences when working with Ukrainian business partners. These differences are not fundamentally negative, but they can influence cooperation and should therefore be handled consciously. Here are some key differences:

1. business culture and communication

  • Directness vs. indirect communication: German business partners are often very direct and factual in their communication. Ukrainian partners tend to communicate more indirectly in order to avoid conflict or express respect.
  • Hierarchical thinking: In Ukraine, the corporate structure is often more hierarchical. Decisions tend to be made from the top, whereas in Germany, flatter hierarchies and co-determination rights are more common.
  • Building trust: In Ukraine, personal trust is particularly important for business relationships. German entrepreneurs are more focused on formal criteria (contracts, compliance, etc.).
  • Flexibility vs. plan orientation: Ukrainian entrepreneurs are considered to be very flexible and solution-oriented, often due to the need to deal with uncertainties and unstable framework conditions. German entrepreneurs prefer clear planning, processes and structures.
  • Understanding of time and punctuality: In Germany, punctuality is highly valued and deadlines are binding. In Ukraine, time planning can be handled more flexibly.
  • Personality-oriented: Relationships in Ukraine are often more personal. German business partners notice that trust is built through personal contacts, which requires more time and emotional intelligence.
  • Less formal, but committed: German partners report that Ukrainian colleagues sometimes work in a less formal and structure-oriented manner, but with great commitment and a talent for improvisation.
  • Fast reaction, but with less depth of planning: Ukrainian business partners often react quickly and flexibly, but long-term planning and documentation sometimes seem less developed, which can be unusual for German partners.

2. working methods and planning

  • Legal framework and contracts. German companies attach great importance to written contracts and compliance with them. In Ukraine, contracts can be seen as a guideline rather than an unalterable obligation - personal agreements sometimes carry more weight.
  • Strengths of Ukrainian partners. Ukrainian business partners (especially in the IT, tech or mechanical engineering sectors) are often perceived as very competent, pragmatic and innovative. They have a high level of technical qualification - especially young specialists.
  • Risk assessment: due to the influence of the war (since 2022): The unstable political and economic situation is leading to increased caution on the German side when it comes to investments and long-term planning with Ukrainian partners.

Challenges:

  • Different expectations of processes, documentation and time management;
  • Different understanding of contractual compliance;
  • Politically unstable situation (risk assessment) in Ukraine.

Opportunities:

  • Access to talented and well-trained specialists;
  • Cost benefits in production and development;
  • Opportunity for German companies to be present at an early stage during reconstruction and market entry in Eastern Europe.

Conclusion:

Ukrainian business partners are increasingly perceived as competent, committed and resilient, technologically adept and European-oriented. Despite cultural differences and structural challenges, the willingness to work together is growing - especially if there is openness, trust and commitment on both sides. The differences between German and Ukrainian business partners lie primarily in:

  • Communication style;
  • decision-making processes;
  • Planning security;
  • legal protection and,
  • Expectations of professionalism.

However, with cultural sensitivity, openness and clear communication, these differences can be easily bridged.

4. differences in business culture with potential for improvement:

Although cooperation is showing positive trends overall, many German entrepreneurs still see potential for improvement - both on an individual and structural level.

1. transparency and legal clarity

Challenges:

  • Uncertainty in legal enforcement: Contracts are sometimes regarded as non-binding, which makes German partners feel insecure.
  • Transparency: There are still reservations, particularly with regard to authorities, tenders and approval procedures.

Potential

  • Greater harmonization with EU legal standards
  • Digital administrative processes to minimize non-transparent structures
  • Expansion of arbitration tribunals or neutral dispute resolution mechanisms

2. project and process management

Challenges

  • Lack of standardization and documentation
  • Often short-term planning
  • Different expectations in terms of time and quality management

Potential

  • Introduction of clear project management standards (e.g. according to PMI or ISO)
  • Professionalization of processes - e.g. through training, external consultants
  • Expansion of digital tools for communication, task tracking and reporting

3. communication & intercultural understanding

Challenges

  • Different communication styles (direct vs. indirect)
  • Misinterpretations due to cultural misunderstandings

Potential

  • Intercultural training on both sides
  • Clear, transparent communication of expectations and deadlines
  • More language training (English, possibly German)

4. network & long-term partnerships

Challenges

  • Often short-term, project-related cooperations instead of strategic alliances
  • Little understanding of the other market logic

Potential

  • Development of strategic partnerships and joint ventures
  • Bilaterally funded networks, e.g. through chambers, industry associations or clusters
  • Exchange programs and business trips (learning visits)

5. infrastructure and site conditions (Ukraine)

Challenges

  • War damage, energy shortages, unreliable logistics
  • Lack of stable framework conditions for investments

Potential

  • Participation of German companies in reconstruction with know-how and capital
  • Use of special economic zones or investment protection agreements
  • More targeted use of international funding (EU, GIZ, World Bank)

Conclusion:

These points should not be seen as criticism, but rather as realistic development potential - many Ukrainian companies are already working specifically on this. With mutual understanding and targeted support, the partnership can deepen significantly.

5. ETIQUETTE IN DEALING WITH UKRAINIAN BUSINESS PARTNERS - SUMMARY

1. personal contact is crucial

  • Relationships before business: Trust and personal relationships play a major role. Without a certain personal level, business deals are rarely concluded.
  • Greeting: A firm handshake with direct eye contact is common (for men - women are often more reserved).
  • Business cards: These should be available in Ukrainian and English.

2. communication - clear but polite

  • Direct communication: Ukrainian business partners communicate clearly, but usually more formally and cautiously in the initial phase.
  • Be aware of the language barrier: English is widely spoken in business, but it is not a matter of course. Interpreters or translations are often helpful.
  • Small talk: Personal small talk about family or origin can promote trust.

3. hierarchies and decision-making

  • Hierarchical: Decisions are often made by management - not by teams or departments.
  • Patience when making decisions: Decision-making processes can take time - pushing is often counterproductive.

4. punctuality and deadlines

  • Punctuality is appreciated, even if it is not always strictly adhered to.
  • Prepare appointments well: Structured presentations and written documents (also in translation) are welcome.

5. gifts and business lunches

  • Small gifts (promotional gifts, specialties from your own country) are appreciated, but not expected.
  • Invitations to dinner are common and important for maintaining relationships - don't turn them down too quickly.

6. Contracts and liability

  • Contracts are important, but the personal word often counts just as much.
  • Renegotiations are not unusual - flexibility and patience are required.

7. Classic, conservative business attire is standard: suit and tie for men, elegant dress for women.