When Stephanie Oppitz opened her shop in Dresden, she believed that the differences between entrepreneurs in East and West Germany could not be so great. After all, everyone has their own happiness in their own hands. "Today I see it very differently," says Oppitz, who founded the Windelmanufaktur in 2011, a company that produces cloth diapers for babies and toddlers sustainably.
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She is not alone in her opinion. After reunification, there was a veritable start-up boom of online retailers in East Germany, according to a new study by the Ibi Research Institute at the University of Regensburg on behalf of the Federal Association of E-Commerce and Mail Order (BEVH), which was available to the F.A.Z. in advance. The researchers measure start-up activity on the basis of the proportion of one year in total start-ups between 1981 and 2021. In 1990 alone, for example, 4.7 percent of all start-ups in online trade took place in eastern Germany during the period under review. In the West, the figure was 1.1 percent.
In the years that followed, start-up activity in the East was also higher. "On the one hand, there was strong economic development in the East at the time, and on the other hand, there was a real spirit of optimism," says study author Georg Wittmann of Ibi Research. Especially since, unlike many other industries, the east of the republic did not have to catch up with a technological lead in the still young online trade. "Everyone had to familiarize themselves equally with the new subject matter," says Wittmann. Economically, this was a great opportunity for the new federal states. Intershop, a pioneer in German online retailing, was also based in Jena.
According to BEVH, online retail currently employs 1,260,000 people in Germany and contributes 2.9 percent to gross domestic product. But the proceeds of East German pioneering work are increasingly being collected in the West. Since 2015, start-up activity in the east has been falling continuously, while in the west it rose until the Corona dip in 2021.
This also has to do with the success of venture capital-financed industry giants such as Zalando, says Wittmann. The success has led to a lot of money flowing into start-ups in online retail, from venture capital investors, but also from established retail groups such as Otto, Rewe or Metro – but primarily in West Germany. "This is a big problem, especially for start-ups," says entrepreneur Oppitz. Without financial support, many people would lack the courage to start a business at all. However, corporations and other investors would only invest where they can find the necessary personnel and expertise, says Martin Groß-Albenhausen, deputy managing director of BEVH.
Both are scarce in the East. According to the study, more than half of East German online retailers are headquartered in regions with shrinking populations. This makes it more difficult to find suitable personnel. Especially since there are significantly fewer courses of study tailored to the industry in East Germany, Groß-Albenhausen complains. "In this way, fewer clusters form around the universities." Mecklenburg-Vorpommern, for example, does not have a single course of study that deals with online trading. In Bavaria, on the other hand, there is a "veritable boom" in courses of study related to online trading.