Company handover & succession planning: 5 decisive key facts

Every year, 30.000 people in Germany are looking for people who are doing well economically Companys a new Executive:in – trend increasing. How to easily overcome this challenge?

Company handover as an important challenge

There are a variety of challenges for companies looking for a new boss: The demographic development of a carefree company handover does not exactly play into the cards. Rather, it reduces the number of potential young entrepreneurs. Why independently ins Risks fall when a well-paid permanent position is waiting on the other side?

At the same time, early entrepreneurs are looking to make the transition to retirement and their children are more likely to go on their own waysinstead of taking over the family business. The topic of company handover is therefore not only a drastic event on an individual and emotional level, but also on a macro level for the larger economic one System significant.

When should the successor be arranged?

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In other words, it is important for every entrepreneur to actively address the issue of succession about three to five years before leaving the company. A company handover is not an easy undertaking. Only with clear formulated goals and a comprehensive project plan, the company succession should be "attacked".

In order to approach this mammoth task in a goal-oriented manner, Business-Coaches can be the decisive professional support - namely those who have specialized in the successful handling of company transfers in their consulting business. Entrepreneurs benefit from many years of experience and a valuable Network to customers who find their way from the Planning have already disputed up to the final handover.

5 key facts on the way to a successful company handover

Regardless of the size of the company, the following five key facts can help with the transfer of the company successfully to tackle.

1. Me first – know your own future

The German Chamber of Industry and Commerce (DIHK) recommends starting succession management three years before the planned handover. Some business coaches advise starting to think about it five years before the handover. So much for the theory. Practical reality shows that only 40 percent of companies use this Suggestions consequences. An early plan can be the decisive factor for a successful handover - both for the company and for the entrepreneurs personally.

You are an entrepreneur for life – even after handing over your company. "Entrepreneur: inner feelings" cannot be snapped out from one day to the next. That's not what handover is about. Ultimately, the decisive factor is: with yourself and the transfer to others hands to be clean. A lot has to do with the individual reasons for a planned company succession. These can be versatile: that Age, illness, new family circumstances, the desire to change jobs or generally want to downsize. The most common reason for an upcoming company handover is age. Building, managing and optimizing a company for years takes time, Energy and Endurance. The following thesis may seem simple, but is often underestimated: after years of exertion and responsibility, "suddenly" being without a company, the constant awareness and line needed, can fast end up in a personal crisis of meaning. In order to avoid this deep hole after the handover as an entrepreneur, one should first be aware of the scope of the step and think carefully about what comes next. Where is the journey going? What fulfills me in my life? What might I want to change? Important: In addition to individual-psychological considerations, there are also decisive practical-financial ones Ask from capital requirements to staffing. How much Capital is required for my project? And: What does this new section mean for the Future mine Employees:Inside?

2. The perfect match

The question of all questions: Who is the right successor for my company? In the search for the "perfect match", the targetStatus of the company as a starting point. Because: First of all, it should be clarified whether an internal or external successor is best for the company.

There are two important components to consider: the candidates’ professional and personal/entrepreneurial qualifications. The meaning of Personality of the successor should not be underestimated. The chemistry has to be right – professional Expertise paired with character Powerthat move the company forward. What is the resilience of the Candidates or the candidate? Does he or she have the necessary entrepreneurial mindset? Does he or she have assertiveness and natural authority? Is he or she clear about the social and societal aspects of his or her future role and the associated responsibilities? In addition, but closely linked to the personal succession, there are questions about the legal structure: Is it a sale, a handover or possibly the Foundation of a family foundation makes the most sense? This has to be weighed up. To deal with these numerous questions and subtleties in the Implementation An experienced business can keep an overview Coach:into be a great prop.

3. We are (not) family?!

The other important question is: Who should you ideally hand over your business to? The answer, as is so often the case, is: It depends. Many entrepreneurs want a successor from their own company for emotional reasons Family. According to studies, more than 50 percent of medium-sized entrepreneurs in Germany secretly have this wish. This is understandable from a purely logical point of view, because in fact a successor from your own ranks brings advantages. A lengthy search for suitable, trustworthy (young) entrepreneurs is unnecessary, as is a time-consuming familiarization with the peculiarities and customs that every company brings with it.

But: Often the most obvious and felt easiest way is not the best. One thing is certain: arranging company succession within the family can also be a tricky matter. The reason is obvious: business and privacy are inevitably mixed together. Not only is the professional future of everyone involved at stake, but also their private lives. This can quickly lead to tensions and power struggles, which inevitably affect both areas of life. Especially in such cases, advice from an independent third party can bring relief to the situation. A neutral and at the same time professional view from the outside does no harm in order to carry out the challenging balancing act of “family succession” without any problems for everyone involved and the company. A coach not only brings new objective perspectives to the “family group”, but also provides concrete assistance if necessary. Developing a family charter together can provide a long-term basis for business succession and prevent conflicts before they even arise.

4. Upside potential

In order to discover the full potential of a company, not only theoretical approaches are necessary, but above all a practice-oriented one Coaching including a basic company analysis useful. With this structured approach, the value of the company can be increased within two to five years at the desired selling price. Targeted planning with high implementation security is particularly important for an increase in value.

Caution: The regular day-to-day business must not be forgotten. Not infrequently verlieren Companies on the last few meters, shortly before an upcoming handover, increase in value enormously. Why? Because the necessary action plan is missing. Studies even show that a handover that is approaching but not complete reduces companies' willingness to invest by up to 40 percent. In order to counteract this dynamic, concrete decisions are made as part of professional follow-up coaching Measures developed and implemented that actively contribute to increasing the value of the company.

5. How much is my business worth?

The most crucial step in planning the company handover: the calculation of the sales price. The correct assessment of the actual company value is the basis for all others steps. But here too, it is better to be safe than sorry. The follow-up report by the DIHK shows that 39 percent of senior entrepreneurs demand an excessive purchase price. An inappropriate overvaluation of the company may seem flattering, but is of little help for the further steps. Disappointment and anger are often the consequences. The actual financial requirement should be understood as the lower limit. Objective is to determine the value of the company as precisely as possible.

In order to determine the "sweet spot" between the current potential sale proceeds and the ultimate desired price, tools such as earnings and asset value methods, discounted cash flow or multiple methods can be used. A team of experts - consisting of company specialists and coaches - who have the necessary market knowledge, tackle this "sweet spot analysis" together. It is precisely at this point that savings should not be made. It is particularly advisable to make use of the services of a tax advisor and an M&A advisor.

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