Lack of entrepreneurs also affects Hessian economy
Skyline of a big city in the purple sunset

Lack of entrepreneurs also affects Hessian economy

Company Succession Hessen: The Hessian economy faces a major challenge in the coming years. Like many economic regions characterised by family businesses, the Rhine-Main region in particular is facing a large-scale generation change. In addition to the already existing shortage of skilled workers, there is also the threat of a shortage of entrepreneurs.

In the Darmstadt administrative district in southern Hesse, more than 5,000 owner-managed SMEs will be facing a company succession in the next five years. In the central Hessian administrative district of Gießen, more than 1,000 companies are affected by the challenge of finding a successor.

Company succession in Hesse: Challenge for company owners

According to an analysis by K.E.R.N - Die Nachfolgespezialisten (Succession Specialists), between 5,000 and 7,000 company owners in southern Hesse - the heart of the Hessian economy - are looking for a suitable successor. That corresponds to about 20 percent of all companies included in the analysis," says K.E.R.N partner Thomas Dörr. Overall, the number is probably even higher, since our analysis only refers to company owners over 60 years of age and only to companies with at least five employees that are ready to be handed over? In just under a third of these companies, the owner is already over 65. Although many owners strive for a generation change within the family, statistically there is no suitable successor in the family in almost half of the cases.

Lack of entrepreneurs threatens Hessian economy

Company succession outside the family is not a foregone conclusion either. According to a recent Study by the DIHK According to everyday practice, there is an average of five former owners for every potential takeover bidder nationwide. The Hessian economy as well as economic development agencies, chambers and banks are therefore alarmed and forced to deal intensively with this issue. Because company successions that are too late reduce the innovative power and delay the modernisation of the SMEs concerned. The resulting reduced competitiveness of the companies not only endangers jobs, but also threatens the future viability of the Hessian economy.

Problem solving as simple as it is complex

The key to successful company succession in Hesse lies in good and early preparation. This is because the planning of a company succession and the structured search for a successor as well as an orderly handover process can take years. The first step must be taken by the entrepreneur himself, although experienced succession advisors can help him. By the end of his or her 50s at the latest, a company owner should begin to deal with his or her own succession.

Tips for further reading:

5 criteria for choosing the right company for a business succession

The costs of a business succession or an M&A project

Which company exchanges are suitable for the search?

Targeted balance sheet adjustment can increase enterprise value

Comment: Unresolved company successions endanger our prosperity

Interview: Preparing the succession within the family well

Earn-out clauses in the sale of a company

 

© Photo: PIA City of Frankfurt am Main, Photo: Karola Neder