(28.09.2022) Every entrepreneur should include succession planning as part of their business strategy. However, a study conducted by the University of St. Gallen (HSG) and Credit Suisse shows that in almost 80% of cases, the motivation for a handover is still health or age.
According to the survey, only a minority of entrepreneurs cite "opportunity to sell the business at a good price" (9%) or "desire to have more free time" (4%) as reasons for selling their business. In 79% of the cases, entrepreneurs delay their departure as much as possible. Moreover, almost half of all former managers still regularly return to the company two years after succession.
Intra-family succession, where the keys of the company are handed over to a family member, is still preferred in 53% of cases. However, this figure can be explained by the proportion of family businesses in Switzerland (75% of all companies in 2016). In the case of a handover to outsiders (over a third of all transfers), the employees and managing partners are often chosen by the transferring party.
Of the entrepreneurs surveyed, only 7% believe that they do not need any external assistance to successfully complete their handover. Nearly 40% of the executives would like to be assisted when dealing with strategic and financial matters. However, tax questions remain the most daunting: around 75% of business leaders are likely to call on external assistance to deal with them.
The survey identifies two ways of transferring ownership. The first involves the successor assuming both management and ownership of the firm at the same time, and the process takes an average of six years. The second is that the predecessor hands over both offices gradually, over a period of about 14 years.
Last modification 28.09.2022
