German Mittelstand Flags Bureaucracy, Energy Costs as Top Risks in 2026 Report
Main Findings of the 2026 Mittelstand Report
By Maria Martinez
Overview of the Report
BERLIN, June 8 (Reuters) - Germany's small and medium-sized companies consider bureaucracy, energy prices and regulatory demands to be their biggest risks, according to a 2026 report seen by Reuters on Monday.
The report, produced by the German Mittelstand Association (DMB) in cooperation with the EMF Institute at the Berlin School of Economics and Law, is based on a nationwide survey of 1,071 entrepreneurs and managing directors.
Key Risks Identified by SMEs
It found that 65.0% of respondents rated bureaucracy as a high risk, followed by energy prices at 62.9%, sustainability and regulatory requirements at 57.1%, skilled labour shortages at 56.3% and dependence on company owners at 54.7%.
Impact on Investment and Strategic Planning
The findings suggest that these small and medium-sized enterprises (SMEs) - some 99% of German firms, known collectively as the Mittelstand - are facing simultaneous pressures that make investment, planning and strategic development more difficult.
Financial Challenges and Investment Dilemma
The report also points to an investment dilemma: While companies need to spend more on digitalisation, innovation and energy efficiency, many lack the financial flexibility to do so.
A third of firms said they did not have sufficient liquidity reserves for a major crisis, while 50.9% expected earnings and financial risks to worsen over the next decade.
Long-term Competitiveness and Innovation Risks
Innovation risks were ranked lowest, suggesting long-term competitiveness may be overshadowed by more immediate concerns, the report said.
(Reporting by Maria Martinez, Editing by Miranda Murray)
