Most companies in Switzerland are small or medium-sized enterprises (SMEs), and many of them face an existential challenge: structuring their business succession.

Smaller businesses, in particular, are heavily affected. According to a survey by Dun & Bradstreet, nearly 101,427 companies were searching for a suitable successor in 2024. Around 17 percent of smaller businesses with 10 to 49 employees have unresolved succession issues. In contrast, this issue is significantly less common among larger SMEs with 50 to 249 employees, where only 8.1 percent are affected.

«Never before have so many entrepreneurs considered shutting down their businesses»

In Switzerland, business ownership is predominantly transferred within families: 42 percent of companies are passed down directly within the family, while 11 percent go to other relatives. 23 perecent of businesses are transferred to employees or members of the management team who are not family members.

These figures highlight the importance of strategic succession planning for ensuring long-term business success – especially in an economic environment marked by increasing uncertainty and a severe shortage of skilled workers.

If no family successor is available, the most common options are a management buyout (MBO), a sale to competitors, or, in the worst case, closing the business.

Looking at neighboring Germany, the situation is similarly concerning. According to the state-owned bank KfW, around 231,000 medium-sized companies are at risk of closure this year due to the lack of a succession plan. KfW reports that never before have so many entrepreneurs seriously considered shutting down their businesses while preparing for their exit.

«This underscores how crucial early and structured succession planning is»

The bank, which has been collecting data on small and medium-sized businesses for over 20 years, also points to an alarming trend: compared to the previous year, the number of affected companies has increased by 67,500. This underscores how crucial early and structured succession planning is.

Regardless of which of the three exit options is chosen, well-planned exit communication is essential. A professional exit requires clear communication from the leadership team with employees, buyers, advisors, customers, and the public.

Not only the content of the message matters but also how it is conveyed. The communication method must be tailored to the expectations of each target group to ensure the message is understood and achieves the desired impact.

This also takes into account the emotional and practical needs of all stakeholders and ensures clarity, empathy, and alignment with their expectations. The responsibility for this strategic communication lies entirely with management and should not be delegated.

«The goal must be to maintain employee morale»

Emotions such as pride, loss, uncertainty, nostalgia, and responsibility shape this process. Saying goodbye to a lifelong project is often accompanied by sentimental feelings, especially when the business has played a defining role in the entrepreneur's identity. There is pride in what has been achieved over decades, but also a sense of loss when handing over the business to a competitor.

The fear that «outsiders» may not fully appreciate the company's value is common. Concerns about the future of employees and the continuity of the corporate culture also play a role. Will the competitor truly continue the business in the spirit of its founder, or simply use it as an opportunity for market consolidation?

For employees, a clear message provides closure, guidance for the next steps, and support. The goal must be to maintain morale, preserve trust, and protect the company’s reputation. Therefore, it is crucial to listen with empathy, maintain transparency, and communicate clear, comprehensible messages. Understanding employees’ emotions while focusing on solutions and future perspectives is key.

«A fascinating comparison: exit strategies of startups»

Investors and customers also require tailored assurances to maintain stable relationships. A well-planned exit communication strategy that carefully addresses the needs of different target groups can smooth the transition and minimize disruptions.

An interesting comparison can be made with startup founders: While baby boomers are often emotionally and traditionally tied to their businesses, younger founders see an exit as a planned goal and a logical step in the business life cycle. Many of them incorporate exit planning from the very beginning of their company. What used to be the signing of a life insurance policy is now the strategic planning of an exit. Various startup platforms now offer standard consulting services to integrate exit strategies into business plans from day one.

«New buzzwords define the entrepreneurship of the future»

Baby boomers can learn from the pragmatic approach of younger founders – practicing early detachment, developing clear exit strategies, and focusing more on the positive aspects of selling a business, such as financial freedom and new opportunities.

It’s true: concepts like «nostalgia and tradition» may become rarer in future business narratives. Perhaps new buzzwords will define the entrepreneurship of tomorrow.

Whether baby boomers or startup founders, the future belongs to those who view succession planning not just as a necessity but as an opportunity—for themselves, their employees, and the long-term vision of their company.

Brigitte Kaps, founder and CEO of KAPS Advisory, advises CEOs and management teams on change and transformation. She holds a Master of Advanced Studies in Business Communications (HWZ, MAZ & LSE) and a degree in communication sciences from Frankfurt University of Applied Sciences. She brings 25 years of international leadership experience from foreign banks (ABN Amro, GE, RBS), including 10 years in corporate finance and investment banking. Before founding her own company in 2015, she was a member of the executive board and led corporate communications at Cembra Money Bank (formerly GE Money Bank).

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