Handing over the baton as part of the corporate strategy
Organising company succession is a unique challenge in the life of an entrepreneur. For him, it means finding a viable solution that transfers his life's work, with all the ties and connections attached to it, into a new future. Securing company succession is therefore one of the most important strategic tasks of responsible company management.
The particular challenges lie in comprehensive succession planning and, in particular, in finding a suitable successor.
The implementation of the ‘right’ succession solution requires sufficient lead time. The earlier an entrepreneur deals with succession planning, the more room for manoeuvre he has for planning and implementation.
Gunter Fauth, Managing Director of Valegra GmbH, has practical tips for handing over your company in stages. In order to prepare a family-internal or external handover process or, if applicable, an M&A process in a long-term and professional manner, you should consider the following points, among others:
- A succession process usually takes 3-5 years.
- Establish a management and organisational structure at an early stage.
- Strengthen the financial and earning power of your company in good time.
- Look for one or more suitable successor candidates yourself (in the family, in management, etc.), because the ‘chemistry’ must be right for the succession.
- A fair price is the basis for a successful sale.
- Gradual transfer of the company shares makes it easier for the successor to manage the financing.
- It is important to withdraw from the operational role after the handover (advisory role or formation of an advisory board).
In the many cases in which a handover within the family is not possible or sensible and a succession by sale is envisaged, supportive external advice is also helpful for smaller family businesses and SMEs. There are many additional points to consider, which you will find outlined in the typical phases of the process and a roadmap in the PDF file available for download here (sorry, available here in German only).
Please feel free to contact the author and/or the AAA Advisor you know personally to discuss your requirements!