Germany's famous Mittelstand (small to mid-sized companies) are praised for providing the backbone for the world's fourth largest economy. They certainly create an impressive export engine. There are 300,000 exporters in Germany, and only 125,000 in France.

Yet, in terms of profit margins, France's small and medium enterprises (SMEs) outperform those in Germany. In France, the profit margin is 3.1 percent; in Germany, it is only 2 percent. French SMEs come out better on other counts too. For example: in France, the return on capital employed is 22.4 percent and in Germany, it is only 15.3 percent, while the cash position is 4.9 percent versus 4.1 percent.

To be fair, the differences could be because of the definition of SMEs in the two countries and because of data availability. Financial information is available for 100 percent of German SMEs but only 47 percent of French SMEs. This can lead to data distortion.

Allianz SE published this content on 04 January 2018 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 04 January 2018 10:19:08 UTC.

Original documenthttps://www.allianz.com/en/press/news/studies/180104_allianz-germany-france-economic-myths/

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