Considerations for starting a business The step to starting your

1 Considerations for starting a business The step to starting your own business must be well thought out. Even when it is only a one-man company. In the state of Brandenburg, therefore, there are many advisory bodies to help you. The guidance services (Lotsendienste) will give you free and competent support. The Lotsendienste are financed by the state of Brandenburg and from the European Structure Fund (ESF and EFRE). Business plan The following overview contains questions, which you should answer in any case in your business plan. This is, however, only a small selection. There are a lot of other questions to be answered according to the branch and size of the planned business. The advisory body employees in the state of Brandenburg will tell you which questions apply in the case of your particular business. If you wish to become professionally selfemployed, a business plan will help you. When you work on this you could discover, for example, whether your qualifications and business knowledge are sufficient. There is no difference here, whether you develop and sell software, open a restaurant or wish to be a professional artist: a business plan must be made when preparing for any company foundation. The businessperson (Unternehmerperson) - Which qualifications do you have which make you suitable to start your own business? - Are you a suitable person to be self-employed? (Knowledge of the risks, determination etc.) Product/Service (Produkt/Dienstleistung) - Which product/service do you wish to manufacture and/or sell? - What is special about your offer? - What is the basis for your pricing/fees? Clients (Kunden) - Who are your clients and where are they? - What requirements/problems do your clients have? - What short term (1-3 years) and which long term (4-7 years) turnover (Umsatz) does this mean? Umsatz = Number of units of sold products/ services x selling price Competition (Konkurenz) - Who are your competitors? - What do your competitors' products cost? - What are the greatest strengths and weaknesses of your competitors? - How can you counter these weaknesses? Location (Standort) - At which location and by which means do you wish to market your product/service (direct selling, Internet, selling agencies)? Standort = The location where your business is. Company legal form (Rechtsform) - On which form have you decided? What are your reasons? Rechtsform = individual enterprise, limited liability company, civil law association etc. Finance plan (Finanzplan) In your finance plan you should calculate how much financing you require and how you will finance it. You should also discover whether your project is worth while. The documents required should be prepared with your advisor: - Capital requirement plan (Kapitalbedarfsplan) · Personal requirement: How high are your personal running costs (living costs, insurance, rent etc.)? · Capital requirements to found you company: What are your founding costs (Gründungskosten) (PC, software, equipment, rent security deposit, purchase 22 Considerations for starting a business of goods etc.)? · Business capital requirements: How much are your costs for running the business: (goods, equipment, business insurance, rent, telecommunications, employees etc.)? · Own capital (Eigenkapital): How much is your own capital? Eigenkapital = your own funds and/or e.g. loans from you family. · Outside capital (Fremdkapital): Do you need financing, if so: how much do you need? Fremdkapital = loans taken out from your bank. · Security (Sicherheiten): What security can you offer for credit? Sicherheiten = e.g. life insurances, savings accounts, cars, machines which can be used as „deposit“ (collateral) in case you cannot repay the credit. - Support programmes (Förderprogramme): Which public support programmes could apply to you? Förderprogramme = Loans, which the state of Brandenburg and the German state offer founders and businessmen at favourable conditions. - Profitability Preview (Rentabilitätsvorschau) Does your estimated turnover (Umsatz) cover running costs? Can you finance your personal living costs with your estimated profit (Gewinn)? - Liquidity plan (Liquiditätsplan) How much income and expenditure (including repayment of credit) do you expect and how much money is left for you e.g. next month? Further information: - Brochure „Who? What? For Whom? The Guidelines for Company Founding, Company Proprietors and Investors in the State of Brandenburg“ To be ordered from: Ministry of Economic Affairs Land Brandenburg Heinrich-Mann-Allee 107 Public Relations 14473 Potsdam or as download under: - www.agil-brandenburg.de - Founder gateway of Federal Ministry of Economics and Labour (BMWA) www.existenzgruender.de Considerations for starting a business 23 2 Personal and commercial insurance Personal insurance These include medical care and disability care (Kranken- und Pflegeversicherung), accident insurance (Unfallversicherung) and measures for old age care (Altersvorsorge). Commercial insurance This includes commercial third party insurance (Haftpflichtversicherung), burglary/theft insurance (Einbruch-Diebstahl-Versicherung) and further insurances according to branch and extent of the business, e.g. building, glass. transport insurance (Gebäude-, Glas-, Transportversicherung). Further information Personal Insurance: Stiftung Warentest www.finanztest.de - Versicherung und Vorsorge Commercial Insurance: Chamber of Industry and Commerce (Industrie- und Handelskammer), Chamber of Trade (Handwerkskammer) or the professional organisation for your profession. 3 Self-employment in a trade or a profession? Whoever becomes self-employed in Germany either practices a trade (Gewerbe) or belongs to professionals in private business (Freie Berufe). What is the difference? Trade A trade is a freelance occupation with which money is earned through making a profit. Whoever for example opens a grocery store, a restaurant, a transport business, an auto workshop or a software company is performing a trade. It is not surprising that the majority of company founders register trades. To start a trade company you must, among other things, register with the local trade registry (Gewerbeamt). They then inform the Inland Revenue (Finanzamt), the appropriate professional organisation (Berufsgenossenschaft), the appropriate chamber of commerce etc. Do not rely on this, however. It is better to check the registrations. You can find out the address of your trade registry from your municipal or local council office. Freelance professions A professional in private business (Freiberufler), of course, also earns his money from his self-employed activities. However, the personal education/training is tied much more closely to his chosen profession. Typical professions are, for example, doctors and physiotherapists, lawyers and tax consultants, engineers and architects or artists, journalists and translators. Freiberufler do not register with the Gewerbeamt, but only at the Finanzamt. You can find out the address from the municipal or local council office. Further Information Whether you belong to the Gewerbetreibenden or to the Freiberufler, there are tax and legal implications. It is also important for your insurance. You must therefore make sure you know which group of self-employed you belong to, if you are uncertain. It could be that you require additional official permits according to which business you intend to start. Information is obtainable from - Chamber of Commerce and Industry - Chamber of Trade - Inland Revenue - The Federal Association for self-employed professions in particular will give you information: www.freie-berufe.de. 24 Personal and commercial insurance · Self-employment in a trade or a profession? Finding a suitable legal form 4 You probably have often seen the abbreviations GmbH, AG or GbR in connection with company names. These indicate the legal forms. There is a difference between two groups: business partnerships (Personengesellschaften) and capital companies (Kapitalgesellschaften). The most important difference is the liability (Haftung). Haften or Haftung means: When you or your company cause damage, you must pay for it. Capital companies (Kapitalgesellschaften) are liable for business activities only to the extent of their company assets. In the case of business partnerships (Personengesellschaften), the proprietor or proprietors are liable with their personal assets. The legal form also regulates other important things: for example which taxes the company must pay or who in the company makes the decisions. For small companies, whether it is a trade or a profession, three legal forms could be possible: Individual enterprise The individual enterprise (Einzelunternehmen) is the best form to start with. This form is automatic when you start a company by yourself. You are liable with all your personal assets. Civil law association (GbR) If you wish to form an association with business partners the civil law association (Gesellschaft des bürgerlichen Rechts (GbR)) is the simplest legal form. Complicated formalities and high costs are not involved. An oral agreement is sufficient for a company contract (Gesellschaftervertrag), though it is advisable to draw up a written document. All the partners are liable with their entire private assets, as the GbR is a business partnership (Personengesellschaft). Limited liability company (GmbH) If you decide to go into partnership, you can choose the form of a GmbH. With this form you can restrict your liability, as this is a joint stock company (Kapitalgesellschaft). Your business activities are liable - with certain exceptions - only to the extent of your share capital (Stammkapital), which you are required to prove when founding your company. The total amount of capital investment is 25,000 Euro. However: If you require credit for your company from a bank, the bank will often require your personal assets as collateral. Then you are liable with your personal assets. For a GmbH you must have a written contract, which is approved by a notary (Notar). Finally you must register a GmbH with the register of companies (Handelsregister) at the local court (Amtsgericht) normally the notary (Notar) does this for you. The GmbH is also possible for individual enterprises: as individual person GmbH (Ein-Personen-GmbH). Seek advice There are other legal forms (Rechtsformen) apart from those three already mentioned. The advisory body of the state of Brandenburg will help you with the decision of which is the most suitable legal form for you. Look around to see which is the usual legal form in your branch (Branche) of business. A translator, for example, is more likely to choose an individual enterprise than an individual person GmbH. If a restaurant is run by more than one person, it is likely to be a GbR. A large import-export trading firm is likely to be a GmbH. Further information - Chamber of Trade (addresses s. p. 16-17) - Chamber of Industry and Commerce (Adresses s. p. 16-17) - Lawyers www.anwaltauskunft.de - Tax consultants www.stbk-brandenburg.de Finding a suitable legal form 25 5 Financing the founding of your company Financing is a particularly important part of your business plan. You should therefore certainly seek advice. Prepare for your discussion well, so your discussion partner is really in the picture of what you intend to do. The documents you need to have with you can be found in Chapter 1 (page 22) in the summary of the business plan. your own bank (Hausbank) before beginning the investment. Note also The majority of those starting up a company finance their founding from their own funds, without loans. Further Information If and which financial support programmes are suitable for you should be decided together with a consultant. - You can find out details of the particular support programmed from: · ILB (address s. page 17) · LASA (address s. page 17) · KfW Infocenter: 0180 1 241124 and KfW counselling centre in Berlin (address s. page 17) - You can also receive advice from the guidance services (Lotsendienste), the chambers of industry and commerce (Industrie- und Handelskammer), the chambers of trade (Handwerkskammer) and the Future Agency Brandenburg (ZukunftsAgentur Brandenburg) (addresses s. page 16) - Summary of financial support programmes: www.agil-brandenburg.de (s. founding your company) Bank or savings bank Your own bank (Hausbank), i.e. your bank or savings bank (Sparkasse) is your most important business partner. This is where you open your business account (Geschäftskonto) and process payments with you suppliers and customers. Your bank (Hausbank) also gives you credit (Kredite) (also called loans (Darlehen)). This is also where you apply for support loans from public funds. The Hausbanken of small and medium-sized companies are mainly community banks (Volksund Raiffeisenbanken) or savings banks (Sparkassen). If you wish to apply for a loan, you need a convincing business plan and you need to make it clear to the lender that you are capable of running a company. The most important support loans from public funds (öffentliche Förderdarlehen) are: - Mikro-Darlehen (max. Euro 25,000) of the KfW Mittelstandsbank - StartGeld (max. Euro 50,000) of the KfW Mittelstandsbank - Unternehmerkredit of the KfW Mittelstandsbank - Unternehmerkapital of the KfW Mittelstandsbank - Gründungs- und Wachstumsfinanzierung (GuW) of the state of Brandenburg and of the KfW Mittelstandsbank Please note that you need to apply for publicly funded support loans always at 26 Financing the founding of your company Documents for your meeting 6 with the bank If you wish to apply for a loan from the bank, you need to explain your business concept and show your supporting documents. Even if you prepared the documents together with your consultant, you must accept responsibility and be able to give information. Documents - CV with history of your work - Work and qualification certificates - Business plan (Unternehmenskonzept/Businessplan) with capital requirement plan (Kapitalbedarfsplan), profit forecast (Rentabilitätsvorschau) and liquidity plan (Liquiditätsplan) (s. page 22-23). - Proof of counselling on company founding from a consultant / where applicable estimation of business concept from your chamber of commerce. No more unemployment 7 – start your own company If you are unemployed, have a claim for unemployment benefit or unemployment benefit II (ALG II) and you wish to start your own company, there are various forms of support. Please note that from 2005, there could be changes in the incentive payments. Make sure you are informed, therefore, regarding updating of the support offers. Bridging money (Überbrückungsgeld) If you are receiving unemployment benefit, you can apply for bridging money (Überbrückungsgeld) to pay for your living costs for the first six months. It is the same amount as your present unemployment benefit. Business start-up subsidy (Existenzgründungszuschuss (Ich-AG)) An alternative for those receiving unemployment benefit is the business start-up subsidy (Existenzgründungszuschuss EXGZ bzw. Ich-AG), which is payable for a period of three years. It does not serve, however, to finance your living costs but rather to pay for your liability for health care and invalidity insurance and pension contributions (Kranken-, Pflege-, Rentenversicherung). Start-up money (Einstiegsgeld) The unemployed who receive unemployment benefit II (Arbeitslosengeld II, ALG II) from the year 2005 cannot claim bridging money (Überbrückungsgeld) or business start-up subsidy (Existenzgründungszuschuss EXGZ bzw. Ich-AG). They can, however, claim start-up money (Einstiegsgeld) in addition to ALG II, in order to become selfemployed. Further Information You can receive updated information, for example from Your job agency (Agentur für Arbeit) and under www.arbeitsagentur.de - BMWA-Infotelefon: 01805 615-002 - Lotsendienste Documents for your meeting with the bank · No more unemployment – start your own company 27 8 Self-employed or apparently self-employed? Small company proprietors who have only one customer are often only apparently selfemploymed (scheinselbstständig). The result is that not only they themselves but also the customer must pay contributions for legal social insurance care (gesetzliche Sozialversicherung) i.e. contributions for pension fund, sickness care, invalidity care and unemployment benefit. Customers want to make sure that they are dealing with really involved selfemployment or only seems to be selfemployed status. The border between each individual case regarding the difference between dependent occupation and selfemployment is judged individually. The best thing is to enquire at the BfA (Federal Insurance Institut for Staff). Further Information Federal Insurance Institute for Staff (Bundesversicherungsanstalt für Angestellte BfA) Service telephone 0800 3331919 Free phone for the whole of Germany Mondays to Thursdays: 9.00 a.m. - 7.30 p.m., Fridays: 9.00 a.m. - 1.00 p.m. www.bfa.de - Statusfeststellungsverfahren 9 Nothing to fear from the Authorities Before you start running your own business, you must attend to the necessary formalities and, for example, register your business. This is important, because if you regularly receive money for carrying out work, without being registered, you count as an illegal worker and are liable to prosecution. For certain types of business you need a special permit or special proofs. Trade registry (Gewerbeamt) If you wish to perform a trade (Gewerbe), i.e. not a self-employed business involving a profession (Freie Berufe), you must first register with the trade registry of the municipal or district office. For this you require: - A residence permit if you are not of German nationality - A valid ID or passport - A permit or license according to your activity (e.g. for gastronomy) - 10 to 40 Euro registration fee - Registering your trade (Gewerbeanmeldung) also means normally registration with the Inland Revenue (Finanzamt), the appropriate professional organisation (Berufsgenossenschaft), the appropriate chamber etc. will follow automatically. Do not rely on this, however. Check that these registrations have taken place. Inland Revenue (Finanzamt) The job of the Inland Revenue is to collect taxes. As a self-employed person, you must pay your taxes to the appropriate Inland Revenue office. The Inland Revenue plays an important part when starting a business, especially for professional people: You need only to register with your Inland Revenue office and apply for a tax number (Steuernummer). This counts as registration for your company. You must state your tax number on all your invoices. 28 Self-employed or apparently self-employed? · Nothing to fear from the Authorities Professional organisation (Berufsgenossenschaft) The professional organisation (Berufsgenossenschaft) is the legal accident insurance body. If you employ anyone, you must insure them in any case with the Berufsgenossenschaft for the appropriate trade. Depending on your trade/profession you may need to become insured with the Berufsgenossenschaft. You can find out which professional organisation is responsible for you either from the Chamber of Industry and Commerce (Industrie- und Handelskammer IHK) or from the Principle Association of Professional Organisations (Hauptverband der Berufsgenossenschaften HVBG). Information: www.hvbg.de Register of companies (Handelsregister) The register of companies (Handelsregister) at the Local Court (Amtsgericht) informs the public about the businesses that are registered there, for instance who the legal representatives of the company are. Those who must register with the register of companies are businessmen/women (Kaufleute) and managing directors of capital companies, e.g limited liability companies (GmbH). Businessmen/women are those engaged in trading. Exception: small business people, who have a simple, easily assessable business, for instance a tobacco shop or a fast-food outlet. Chamber (Kammer) Some businesses must be registered with a chamber and pay the dues. The chamber is a professional organisation, which represents its members, for example in commercial political decisions and also supports the management through advising, organising campaigns and up to date information. Among the chambers we have, for example the Chamber of Trades (Handwerkskammer), Chamber of Industry and Commerce (Industrie- und Handelskammer), the Cham- ber of Architects (Architektenkammer), the Chamber of Tax Consultants (Steuerberaterkammer) or the Chamber of Doctors (Ärztekammer). Regarding the Chamber of Trades (Handwerkskammer) In Germany there is a requirement for a master tradesman's indenture (Meisterpflicht) for some trades. This means that only someone who has passed the examination as a master tradesman can start a self-employed business. There are also 53 tradesman branches without compulsory master certificate (Meisterpflicht). For those from a foreign country there are various possibilities according to country of origin to start your own business in Germany without a master's certificate. In the main it depends on recognition of your qualifications and experience in your trade. Your Chamber of Trade will advise you in this respect. Health Authority, Vehicle Registration Office, Police (Gesundheitsamt, Kraftfahrzeugamt, Polizei) These and other Authorities are responsible when you require a permit or a license to perform your business (Erlaubnis, Zulassung). Your appropriate chamber or the Guidance Service Brandenburg (Lotsendienst Brandenburg) will inform you whether you require a permit or a licence (Erlaubnis oder Zulassung). If for instance you wish to open a pub, restaurant, discotheque or other gastronomy business or a security service, you need to take part in a course of instruction (Unterrichtung) with the Chamber of Industry and Commerce, in order to acquire the necessary knowledge. Further information - www.agil-brandenburg.de - www.existenzgruender.de Nothing to fear from the Authorities 29 10 Getting to know the taxes and paying them If you have your own business you have to pay taxes, so, of course, it is necessary to know the most important kind of taxes. Turnover tax (Umsatzsteuer) Applies to: tradesmen and professional self-employed When you sell goods or services (e.g. consultancy), you generate turnover (Umsatz), i.e. you are receiving money from your customers. In addition to the price or fee, your customers must pay you turnover tax (Umsatzsteuer) (or value added tax - VAT) (Mehrwertsteuer). You must therefore add VAT to the net amount of each invoice you issue. This becomes then the gross price or gross fee. The turnover tax (Umsatzsteuer) is normally 16% of the net amount. For certain trade or professional groups the reduced rate of 7% applies, e.g. for printing works, art and media professions. And: business people who apply the small business principle (Kleinunternehmerregelung) (s. page 31), need not pay any turnover tax (Umsatzsteuer); they cannot, however make any deductions for VAT they have paid. Input tax/Pre-tax (Vorsteuer) Applies to: tradesmen and professional self-employed If you buy office materials, goods and consultancy, the tax you have paid is called input tax or pre-tax. You can deduct this pretax (Vorsteuer) from the turnover tax (Umsatzsteuer), which you make with your VAT return (Umsatzsteuervoranmeldung) and payment to the tax office which as a rule you make monthly or, in the case of small turnover every quarter. Trade tax (Gewerbesteuer) Applies to: Commercial business operators All operators of a commercial business (Gewerbetreibende) must pay trade tax (Gewerbesteuer), i.e. proprietors in trading, trades, service and industry. The rate of trade tax (Gewerbesteuer) depends on the company's profit and from the local government where the company is located. Trade tax must be paid each quarter to the Inland Revenue in advance. Corporation tax (Körperschaftsteuer) Applies to: Capital companies Only capital companies (Kapitalgesellschaften (GmbH, AG)) or co-operatives (Genossenschaften) pay corporation tax (Körperschaftsteuer). All profits are taxed at 26.5%. Income tax (Einkommensteuer) Applies to: All taxpayers Every citizen, i.e. every businessman who generates or is paid an income must pay income tax (Einkommensteuer) (in the case of employees this is called Lohnsteuer). The rate of income tax varies according to your income. You must pay your income tax every quarter in advance to the tax office. However only insofar as you have earned enough to pay 200 Euro tax in the quarter. Further information Free advice on the subject „taxes“ is given in the Service and Information office (Serviceund Informationsstellen (SIS) in (almost) all Inland Revenue offices in the state of Brandenburg. 30 Getting to know the taxes and paying them Relief for small businesses 11 No turnover tax You are considered to have a small company when your turnover in the previous calendar year was no more than 17,500 Euro and in the present calendar year is not expected to be more than 50,000 Euro. You can then be made not liable for turnover tax (Umsatzsteuer) by the tax office. In this case you can not add VAT to your invoices. You can also not claim for the so-called (Vorsteuer) (reclaiming VAT that you yourself have paid on invoices). Simple accounts If you have a business you are required to keep accounts. Simple accounting is permitted when - your annual turnover is no higher than 350,000 Euro; - your profit is no higher than 30,000 Euro; - the value of your land or forest area is no higher than 25,000 Euro. If these values are exceeded you are liable to keep extensive commercial accounts. Further information - Chamber of Industry and Commerce courses in basic accounts - www.agil-brandenburg.de Existenzgründung - Formalitäten - Kleinunternehmerförderungsgesetz We will help you 12 The guidance services (Lotsendienste) will give you free and competent support. Here you will find advice before founding your company. After founding, company proprietors can receive further support from counsellors, so-called Coaching. Guidance service for immigrants (Lotsendienst) This guidance service has been specially set up for company founders from abroad. They receive all the important information, such as a review of all steps, which you must take in preparing for founding your company. Please make use of this offer and consult the guidance service (s. page 16). agil – Aufbruch Gründen im Land For your first steps, make use also of the Internet offer for business founders and new emtrepremeurs in the state of Brandenburg under www.agil-brandenburg.de Founder gateway of the Federal Ministry of Economics and Labour Here you will find an extensive amount of information, all concerned with the subject of founding your company. www.existenzgruender.de Relief for small businesses · We will help you 31 „A lot of support“ Romana Litkova, Konstantin Shpunt 5pro Software GbR Frankfurt (Oder) Country of origin: Ukraine Ms. Litkova, you have founded a company together with your business partner Konstantin Shpunt. Why? Litkova: After finishing my studies I came to Germany to do a postgraduate course here in Frankfurt at the University of Viadrina. The main subjects were international commerce and marketing. I wanted to work in an innovative branch such as IT. After speaking to some Ukrainian companies, I discovered that there was great interest to have someone here in Germany who would find clients for these companies throughout Europe. We developed our business from this idea. Today we buy software from Ukrainian companies and sell them on with our own name. We do not trade only in software, however, we also take part in the development process. My business partner Konstantin Shpunt is a graduate of information technology and takes part in the development on the spot in the Ukraine. After you decided to start your own business, who helped you with the preparation? Litkova: First of all I had already collected information on starting a business from my studies and in addition from research in the Internet. We also approached the Chamber of Industry and Commerce in Frankfurt (Oder), in order to clarify all the legal, marketing and official questions. The Chamber helped us a great deal. The second organisation that helped us a lot is the BIC, the Business- and Innovations Centre here in Frankfurt (Oder), where we also have our offices. The BIC provides as well as reasonably priced business premises also company consultation and secretarial services. They also help solve difficulties with the Authorities. You operate throughout Europe. How do you find your customers? Litkova: We communicate largely via e-mail and Internet. I am, for example, in an Open Business Club, an organisation of company directors in Germany. Here there are more than 1.000 people online every day. They can chat and explain their ideas. A very useful organisation here in Frankfurt is the ZukunftsAgentur Brandenburg (Future Agency Brandenburg), which introduces us to ever more potential customers for projects and queries for projects. Up until now there is a very positive development. We have customers in Germany, Austria, Italy, Belgium and France. We even sell one of our products in the USA, a mobile telephone game. 32 „Happy Kebab“ Mehmet Canli, Ahmet Canli Malta-Grill Nauen Country of origin: Turkey Interview with Mehmet Canli. You run a fast-food outlet for Turkish food. How was the start? Canli: We took over this restaurant here in Nauen six months ago and sell here doner kebabs, Turkish pizzas and other Turkish food. Although we got a lot of warnings about the restaurant, we decided to take it on - the place was rather run-down and had a bad reputation. But we thought if we renovate, keep everything clean and make a real effort, it will work. The beginning was slow, however, we hardly had any customers. But the few who came at that time liked it. The reason was simple: we talk to our customers a lot and actually always are in a good mood. The people like that and because we got talked about, we had a lot of customers within a few weeks. How did you prepare? Canli: Since we both worked in this branch before we started up ourselves, we actually knew all about it, so we had no big problems. We asked others in the business, though, what Authorities are important, what we must be careful about etc. We had to be careful, though, as some people try to „put soap under our feet“. The company we buy the meat from for the doner kebebs also gave us good tips and helped us financially. They are, of course interested that the business succeeds and help you. Then we gave a tax consultant the job for us and my sister-in-law helps us with all the bureaucratic work. What would you recommend other business starters to do? Canli: You should first have practical experience from the branch in which you are going to do business. That is very important. Also you should be financially independent. If you borrow money, you should be sure that you can pay it back. I already said that the beginning was difficult for us, because we did not have many customers at first. For this reason I reconmend advertising to start off and, for example, placing adverts in local sections of newspapers or to contact local newspapers. They usually like to report on new pubs and restaurants nearby. How important is the German language in your opinion? Canli: That is absolutely important. We speak German, of course, with our customers and we are still working on our knowledge of German. But as soon as we have more time, we will start a German course in any case. What are your plans for the future? Canli: We are going to move from here and open up a bigger restaurant. In a new location we will have more passers-by. This means our business will grow. 33 „Other countries, other values“ My experience in starting my own company shows time and again that the aliens legal position as well as the language difficulties make me the most problems. But also visits to the trade registry, tax office, professional organisation and the chamber of industry and commerce. This is usually not so easy even for Germans, but for Chinese we have additional cultural value attitudes and behaviour, which are different from those of Germans. We try to intervene in these cases. This is difficult and can often lead to misunderstandings. Attitudes towards the Authorities in China are quite different. They are marked by duties and obedience and are not so trustful and legally established as here. A gift counts as an expression of joy about successful cooperation - not as a bribe. The business relationships are based mainly on personal contacts, which build confidence; whereas in Germany the contacts are mainly founded on competency and are restricted to the official departments. The hierarchy of superiors towards subordinates is much more emphasised than here. What are your business plans for the future? Wang: We are considering setting up a possible further location We are also working on acquiring larger companies as customers and moving to Brandenburg. Shi Wang German-Asiatic Cooperation Centre GmbH Berlin-Brandenburg Borkheide Country of origin: China How did it come about that you started your own business in Germany? Wang: I have lived in Germany since 1992 and after my studies in Peking I studied communications science in Berlin. I received many enquiries at that time whether I would take on translations or research for Chinese companies. That is how the idea came about, to start a company, which would operate on these lines. So you founded your first company in 1999? Wang: Yes, we - I had a business partner organised visits to Europe for Chinese business people, academics or high ranking persons. We also exported German products to China. Then at the end of 2002 I founded together with my partner Ernst-Friedrich Siebert the German-Asiatic Co-operation Centre (DAZ). We advise and care for Chinese company executives and college leavers who have studied in Germany and now wish to start up a company here. What caused you particular difficulties when starting your business? Wang: Actually I didn't have any difficulties. We have had very good experience with the Authorities here in the state of Brandenburg. The Chamber of Industry and Commerce in Potsdam has given us very good advice. That applies also to the trade registry here in Brück. With the Aliens Office it was not so easy at first. But after a meeting with the department head and the district manager in Teltow we received good support. 34 „Technical college helps to start up“ Piotr Borowiec Borodesign Potsdam Contry of origin: Poland When did you decide to start your own business? Borowiec: After studying industrial design at the Berlin Art College I worked for three years half days in an office. That was a good start. But after a while I had the feeling I could not advance any further with my profession. And I saw self-employment in my profession as a way to build up something reasonable. You worked for three years half days and thought time and again about your business idea. What kind of an idea was this? Borowiec: For me design is CAD - Computer Aided Design. This means I want to supply my customers with a design that they can immediately make use of. The designs I give my customers can be applied immediately to the production process, because the data are identical to those of the customer. That can be a washing machine, a telephone, a bicycle, a piece of furniture, a toothbrush, a pair of spectacles. Who helped you particularly with the preparation for founding your company? Borowiec: That was mainly the business start-up advice centre of the Potsdam technical college, BEGIN (Brandenburg Business Start in the Network). I had here a contact, who helped me with, for example, the subject of registrations or legal matters. My three years of preparation and discussions with other designers were the reason I already knew what it entailed. Were there any particular problems in preparing the founding of your company? Borowiec: Yes, although that had more to do with my private life. I have been living in Germany for a long time and took my university entrance examination here in 1994. For this reason I have a permanent residence permit. But my girlfriend is Polish and has not been in Germany so long. Although Poland is now a member of the EU, she cannot get a residence permit due to the bridging period of seven years. This means I must guarantee her living costs and when one has just stated up in business, this is, of course, a big burden. What is the situation regarding finding your customers? Borowiec: I telephone, write letters, send flyers. I am also going to try for customers abroad. In my work I produce mainly data, which I can also send by e-mail. This means I can also work with customers abroad. How do your business plans look for the future? Borowiec: My aim is, of course to obtain a growing circle of customers. I have great hopes for the Volkswagen company among others and they are building a new design centre in Potsdam. But I think that is a vision for the future. 35