Middle market businesses are at the heart of the German economy. Ninety-nine percent of all German businesses account, in fact, for 70 percent of all jobs and, with a 49 per cent share of gross value creation, they also make a crucial contribution to Germany's economic development. Yet the challenges facing middle market businesses have become more complex and differentiated. "Middle market businesses have changed. With a strong consultancy firm by their side, they have enormous potential," says Peter Bartels, expert on middle market businesses and member of PwC's Board.
Peter Bartels, most people still associate PwC with advisory services for large conglomerates. Does PwC also see itself as a partner for middle market businesses?
Bartels: It's true that PwC comes from a background of working with large clients such as major industrial enterprises, banks and insurance companies. But it's not just the large corporations that can benefit from our expertise. For some years now, we have been providing an increasing number of midsized businesses with our knowledge and services. At a time when middle market businesses are globalising en masse, in a rather similar fashion to the way conglomerates have been doing so over the past few years, there is a huge demand for global advisory services, specialist knowledge and industry expertise.
What specific changes have there been in the level of demand for advisory services as a result of globalisation?
Bartels: These days, any business that goes beyond producing things by hand has to think beyond borders. Middle market businesses are being forced to think globally as well. Added to this, the internet has removed the limits imposed by time and space. Middle market businesses are having to face up to the fact that their products are being offered all the time and all round the world via the internet, exposing them to very broad-based competition. To respond to this challenge, they need the support of a global network. With 161,000 employees in 154 countries around the globe, we can offer our services anywhere in the world and develop a solution to any problem from within a close-knit network.
Global advisory services do not cater exclusively to middle market businesses. So do you offer advisory services specially tailored to middle market businesses?
Bartels: Obviously, we offer our middle market business clients advice that is specifically matched to the challenges of the middle market. We have the right specialist for every issue facing the middle market business – be it alternative financing for middle market businesses, advice on succession issues for family-run businesses, or advice and assistance given to private clients.
Question: What makes you so sure, given your size, that you are the right partner for middle market businesses?
Bartels: For a start, we have a set-up similar to many middle market business offices these days. Across Germany, PwC has 27 locations where middle market business experts provide localised, personal assistance to midsized businesses with a high degree of personal contact. We are just an hour's drive away from every middle market business in Germany. This means that middle market businesses have access to both a network of national and international specialists, and to an advisor in a nearby office. So we are able to combine the strengths of a large advisory and auditing firm with the advantages of a local middle market business office.