Family-owned industrial companies are often described as if the German business environment were uniform. It is not. Corporate tax multipliers, labour supply, transport, digital infrastructure, universities, energy systems and state administration vary substantially across the Länder.
The 2026 Bundesländerindex Familienunternehmen, produced by ZEW for the Foundation for Family Businesses, provides one of the more structured attempts to compare those conditions.
Saxony and Bavaria lead for different reasons
ZEW says Saxony moved ahead of Bavaria in the latest edition. The result is not a claim that Saxony is best on every measure. ZEW notes that Saxony is only average on taxes and institutions, while Bavaria is comparatively weaker on infrastructure.
That decomposition matters for companies. A precision manufacturer, software business and energy-intensive industrial group will assign different weights to skills, taxes, finance, power and transport.
Why the state level matters for the Mittelstand
Many German family companies are tied closely to the regions where they were founded. Supplier networks, vocational training, universities and local labour markets can become part of the competitive advantage.
Relocation is therefore much harder than comparing tax rates on a spreadsheet. The better use of a state index is to identify the constraints a company may face as it expands.
How GBR will use the index
GBR will connect state-level indicators with its city guides and company research. The goal is to explain why clusters persist in places such as Saxony's semiconductor corridor, Bavaria's technology and machinery economy, or Baden-Württemberg's automotive and engineering base.
Over time, the index can also provide a framework for tracking whether infrastructure and skills investment are improving the operating environment in lagging regions.