Struggling Companies Struggle to Find Suitable Heirs in 2024
In a concerning development, the President of the German Association of Chambers of Industry and Commerce (DIHK), Peter Adrian, has highlighted the need for urgent action to simplify succession processes for businesses. The call comes amidst a growing crisis in Germany, where the number of businesses crumbling is on the rise.
The latest DIHK report on business succession, sourced from the Rheinische Post's Monday edition, sheds light on this issue. The report indicates a significant shortage of potential successors in Germany, particularly in the hospitality, retail, services, and IT sectors.
In these sectors, the supply of businesses exceeds demand by more than three times in the hospitality and retail sectors, and twice as many businesses are offered as there are interested parties registering for succession consultations in the IT sector and services sector.
The situation is causing tension due to this significant imbalance between supply and demand. According to the report, more than half of succession searches may remain unsuccessful, due to a lack of interested parties.
Peter Adrian has expressed his concern about this situation, stating that more businesses are crumbling in Germany. He has emphasized the importance of simplifying regulations and administrative processes to facilitate business succession.
The DIHK President has also called for immediate simplification of business succession processes. He has highlighted the need for action to address the complexities in these processes, which are contributing to the crisis.
In 2024, the sectors with the greatest shortage of successors for business takeovers are mainly small and medium-sized enterprises (SMEs) across various industries. The situation is notably difficult in traditional SME fields, including manufacturing and crafts, due to factors such as skilled labor shortage and bureaucracy.
The increase in the number of entrepreneurs seeking to sell their businesses represents a 16% rise from the previous year's figures, according to the same report. However, the number of businesses offered for sale is not specified in the report. Around 4,000 interested parties were reported for business takeovers.
Peter Adrian has stressed the need to address this issue, stating that the gap between the supply and demand for businesses in succession is growing in Germany. He has urged for immediate action to prevent more businesses from crumbling and to ensure a smooth transition for those seeking to retire or move on from their businesses.
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