From Hessians: Mercenaries, Rebels, and the War for British North America, by Brady J. Crytzer (Westholme, 2015), Kindle Loc. 280-95:
The close of the Seven Years’ War saw a great reshuffling of Europe’s imperial hierarchy, and with each great power attempting to reestablish itself within the new geopolitical order. The 1763 Peace of Paris established the northern kingdom of Prussia as the supreme German state in the region and its ruler Frederick the Great proved to be a magnetic and respected enlightened politician. To the south Prussia was challenged for regional superiority only by the long-standing European power broker of Austria.
As Prussia and Austria gained prominence in central Europe in the wake of the postwar reorganization, the smaller polities began to do whatever was necessary to maintain relevance in an ever changing world. For those left out of the Austro-Prussian sphere of influence, there were few ways to remain competitive in the international arena. There were few natural resources to sell on the open market and because of their tiny territorial possessions, few found realistic opportunities to expand their wealth. While they lacked the commodities typically associated with increased revenue through wider economic pursuits, it seemed the only true domestic product that many of the smaller states of the Holy Roman Empire had to offer were the people themselves. With a large population held in subjugation due to an adherence to a dying feudal system, many regional German rulers began exploring new ways to turn their otherwise shrinking revenue streams into hefty channels of profit. Their means of doing so became known as Soldatenhandel, or the soldier trade. Typically speaking, the small states of the German empire, like Hesse-Cassel, bolstered their army’s numbers through either conscription or hiring mercenaries themselves, but few ever considered actually renting their armies to outside powers. When it was discovered that there was a market for such an unusual practice as Soldatenhandel, the kings and lords of the German countryside began to dramatically increase their draft totals. By 1776 in the simplest terms the otherwise insignificant German states made themselves relevant to the great powers of Europe by offering their own citizens to the highest bidder.