- Support of companies' growth
- Support of internationalisation
- Support of SMEs
BMWi - Markterschließungsprogramm
BMWi (Federal Ministry for Economic Affairs and Energy) – Market Development Programme
The target group are SMEs and self-employed people. Companies must have fewer than 500 staff and less than €50 million of annual turnover. Larger companies may participate in an event if there are free places left.
Certain areas such as renewable energy, energy efficiency, fishery, and agriculture are not covered as there are other specific measures in place for these sectors.
The programme supports German enterprises in developing markets in foreign countries through providing quality market information, promoting awareness of these companies abroad, creating networks and contacts abroad and meeting business partners in a cost-efficient manner. Ultimately, the aim is to increase awareness of German technologies and services around the world and increase export sales of German companies. While some corresponding indicators are monitored, no specific target values have been set.
The programme focuses on thematic fields and mega-trends entailing worldwide future business opportunities – such as environmental and health care technologies - as well as on rather traditional areas of industry, crafts and services.
The ‘BMWi-Markterschließungsprogramm’ comprises various types/forms of support (so-called modules) related to market development activities of German companies in foreign countries. These modules take the form of events and include the following:
- Information events (usually one day) in Germany focus on certain target countries and industries (for example, railway technology in Italy). Besides German experts, also experts from the target countries deliver inputs (for example, on framework conditions, market opportunities, trends, technical standards, procedures, taxation) and are available at the events. This module mostly addresses newcomers to exporting or to the relevant target country. The average number of participants is approximately 20 firms.
- Market exploration: German companies can participate in study tours to foreign countries, including information events and workshops, visits to authorities, agencies, potential business partners (clients, importing agencies, distribution partners etc.), and interesting premises for possible investment. It may be connected to visiting trade fairs in the country. Market exploration tours focus on specific industries and they are often used in the case of developing and transition countries (for example, aviation and space industry in India). The number of participating German companies usually ranges from 10-20.
- Symposiums in target countries: At these ‘symposiums’, which usually focus on a particular industry, German companies can present their products and services to an interested audience (potential clients) abroad (for example, chemicals/petroleum industry equipment in Russia). So, the purpose of presentation of the companies’ own products and services is central in this module, while in the market exploration module companies focus more on obtaining information about the foreign market. The symposium is, however, often supplemented by activities such as visits to organisations, briefings about the target market and market analyses. The average number of participating German companies is 8-12.
- Business initiation trips: These are business trips to individual target clients, importing agencies or other potential partners. Compared to market exploration tours and symposiums, the visit agendas are more individualised for each participating German company and include mainly bilateral meetings (next to a joint general information event). Business initiation trips also focus on a specific industry and target country/region (for example, water management in Turkey, automotive supply industry in the US, monument preservation in the UK). They usually last for 4-5 days. The average number of participating German companies is 8-12.
- Buyer visits to Germany: Potential importers (buyers) from foreign countries are invited to Germany to participate in events, featuring presentations of German companies, and/or to visit German companies. Buyer visits are usually focusing on a particular industry or technology and their duration is 3-5 days. Visiting a trade fair in Germany may be part of the buyer visits. The average number of participating German companies is approximately 12.
- Similarly, visits to Germany are also organised for foreign media and other multipliers (politics, administration) to inform them about what German enterprises are offering (for example with a focus on certain technologies). The agenda usually includes various events and visits and the duration is about 3-5 days. Visiting a trade fair in Germany may be part of the visits.
- Pilot projects: Other initiatives aiming at the development of foreign markets can be carried out or supported upon request.
The programme can also be used by German firms to access foreign import markets and tap new sources for inputs.
There were 3 previous support programmes for internationalisation, one specifically for eastern Germany, one for knowledge-intensive services, and one for SMEs. These programmes and their contents were mainly defined top-down, that is by public authorities. The German business sector, however, demanded a more bottom-up and user-driven approach in shaping contents and forms of support. The idea was to develop a programme where specific internationalisation support initiatives, measures and areas of focus are being proposed by the business community itself. Thus the ‘Markterschließungsprogramm’ was devised as a kind of framework for user-driven support initiatives especially for SMEs. It replaces the predecessor programmes.
- National funds
Federal Ministry for Economic Affairs and Energy – BMWi; Federal Office for Economic Affairs and Export Control – BAFA; Germany Trade & Invest (GTAI)
Strategic advisory board- approximately 20 people - includes representatives of chambers of commerce and other business associations
The 2016 evaluation of the programme identified the following effects (InterVal, 2016):
- An information effect, that is an increased level of useful information on the target market, has been found for 71% of participants at information events, 77% of market exploration participants, and 88% of participants of business initiation trips.
- A networking or contacts effect, that is new or closer contacts to business partners abroad, has been found for 45% of participants across all outbound events. For some 30% to 40% these contacts have been sustainable over a longer period of time.
- Business effects, that is enquiries from the target country, agreements, or even contracts, have been found for 49% of participants at events. (This effect does not necessarily involve any turnover yet.)
- Export effects, that is additional export sales, have been found for 21% of participants at business initiation trips only eight months after the event took place. The total amount of these sales is estimated at €37 million in 2015 or €116,000 per participating firm.
- An employment or job effect has been found for 18% of participating companies. The total employment effect was 110 jobs created.
The 2016 evaluation of the programme points out the following strengths of the measure (InterVal, 2016):
- Different standardised modules address different phases or stages of market development along the process of (i) getting information on a market, (ii) exploring a market and (iii) finally establishing concrete contacts to clients in a foreign market;
- Highly industry-specific events ensure that support is geared towards the specific needs and circumstances of different industries;
- A broad coverage of different geographic target markets (countries);
- High quality of the individual events. Satisfaction levels of participants are high for all types of events (this may be because participation quickly translates into visible and tangible results for companies);
- The structuring of the different modules is clear and comprehensible for SMEs;
- The programme addresses the key challenge of finding business partners abroad; and
- Different amounts of companies’ own financial contributions in accordance with firm size.
The management and administration of the programme is relatively cost intensive and mobilising a sufficient number of participants is often a challenge. Additionally, awareness of the programme in the business community is still limited.
The 2016 evaluation (InterVal, 2016) identified possible improvements:
- There is some overlap with support offers provided at regional level (Länder), but these regional offers are usually more limited to certain sectors and are offered less regularly;
- A more transparent selection of proposals for events based on clear selection criteria;
- Reducing the time between submission of an event proposal and implementation of the event by allowing for submission of proposals in shorter intervals. (This has already been addressed by the programme’s management);
- Facilitating the recruitment of participants to the events, for example through exchange of good practices among ‘promoters’ or by introducing a database of relevant companies. In addition, communication and branding of the entire programme could be raised.
- Having representatives of the ministry (BMWi) attend all visits abroad as this can raise the profile of the delegation (especially vis-à-vis foreign authorities) and thus increase the success and results of the visits.