Latest news with #businesssuccession
Zawya
27-06-2025
- Business
- Zawya
Passing the Torch to a Trillion-Dollar Future: The 4th China Next-Gen Entrepreneurs Forum Redefines Private Enterprise Succession
HONG KONG SAR - Media OutReach Newswire - 27 June 2025 - Amid an era of unprecedented generational transformation, The 4th Forum of the New Generation of Entrepreneurs kicked off on June 17 in Beijing, sparking a groundbreaking dialogue on the future of private enterprise succession in China. Jerry Lu, Chairman of Jinshang Technology Group, set the stage with a powerful and inspiring keynote titled " Carry on the Second Half, Writing a New Chapter" captivating the audience and setting the tone for this pivotal event. The event brought together over 1,000 participants, including distinguished experts such as Ji Weimin, Deputy Director of the Institute of Industrial Economics at the Chinese Academy of Social Sciences and President of China Business Journal, Prof. Peng Qian, Director of Roger King Center for Asian Family Business and Family Office at the Hong Kong University of Science and Technology, along with representatives from the new generation and private enterprises. Bridging Generations: From Conflict to Understanding Jerry Lu's keynote began with a personal story of accompanying his father on a business trip at age 12, planting the seed of his desire to one day stand shoulder-to-shoulder and lead alongside him. Jerry Lu reflected on the complexities of generational succession, sharing his personal journey of transformation—from feelings of frustration to a deep sense of understanding, and from reluctantly inheriting a legacy to actively embracing it. He likened the first generation's contributions to a powerful "threefold fuel"—resources, experience, and spirit—that not only provide a foundation for the next generation but also serve as a launchpad for bold innovation and future growth. Turning Challenges into Opportunities: 68% Attrition vs. 71.2% Survival Jerry Lu highlighted critical insights into the generational succession crisis, revealing that 68% of successors forced into leadership roles leave within three years, and only 3% of such businesses survive beyond five generations. In contrast, businesses led by proactive successors boast a remarkable 71.2% survival rate over three generations, underscoring the importance of intentional, forward-thinking leadership transitions. To address these challenges, Lu outlined five strategic pathways for successful succession: cultural governance, technology-driven transformation, digitalization, industry upgrades, and cross-sector integration. As a testament to these principles, Lu shared his own approach—leveraging the TOJOY's Platform to build a comprehensive health and legacy service platform tailored for high-net-worth clients. This integrated innovation model not only harnesses the resources and networks of previous generations but also positions businesses for sustainable growth in a rapidly changing landscape. Academic and Media Perspectives on Family Business Succession Ji, a seasoned media expert, shared insights from a decade of research on over 2,000 family businesses across China, identifying three pivotal shifts essential for successful succession. The first shift urges the next generation to move beyond the passive role of "inheritors" and embrace the proactive role of "co-creators," taking responsibility for driving innovation and growth. The second shift emphasizes the importance of utilizing professional tools, such as insurance and trusts, to effectively protect and transfer family wealth. The third shift highlights the need to establish a sustainable ecosystem by integrating financial tools, family culture, and legal frameworks. Building on this perspective, Prof. Peng Qian shed light on the growing trend of family businesses transitioning into family offices. She emphasized that the longevity and success of family enterprises rely on shared values, a long-term vision, and strategies focused on creating impact. As family businesses confront challenges like a shortage of successors and intergenerational conflicts, family offices are emerging as a vital solution. These offices not only manage wealth but also foster family unity and uphold values through philanthropy, education, and social impact investments. Peng stressed that this transition is essential for preserving family legacies while ensuring their growth and relevance in an ever-evolving business landscape. An 84 Trillion Yuan Shift: From Family Mission to National Legacy Over the next 30 years, approximately 84 trillion yuan in private wealth will transition to the next generation, shaping the backbone of China's economy. This forum, blending academic research, media insights, and practical case studies, presented a bold new blueprint for succession. With private enterprises contributing over 50% of tax revenue, 60% of GDP, 70% of technological advancements, 80% of employment, and more than 90% of all businesses, the next generation's responsibility extends far beyond their families—it is deeply tied to the nation's future. As Jerry remarked,"We inherit a legacy forged by our predecessors' perseverance, and we write a new chapter under the banner of national rejuvenation." A new era of collaboration, innovation, and shared responsibility has begun, paving the way for the future of China's private economy Hashtag: #TOJOY The issuer is solely responsible for the content of this announcement. TOJOY Shared Smart Enterprise Services
Reuters
10-06-2025
- Business
- Reuters
In Germany, retiring company owners struggle to find successors
BERLIN, June 10 (Reuters) - Rudolf Kiessling would like to retire after years spent building his heating, ventilation, and air conditioning business. But he faces a challenge common to many German company bosses: finding someone to take over. The 62-year-old is among thousands of owners of small and medium-sized enterprises (SMEs) - some 99% of German firms, known collectively as the Mittelstand - who may have to wind up their businesses if they cannot find a successor. The issue is a growing risk to Europe's largest economy, already suffering its longest downturn since World War Two. "I have no one. I have a son, but he can't do it because he has done something completely different professionally," Kiessling told Reuters. "Some employees may have interest, but they are a bit afraid of the responsibility." A survey by state-run development bank KfW showed around 231,000 SME owners planning to close their companies by the end of this year - 67,500 more than a year ago. Age is a major factor: demographic data show more than half of Mittelstand owners are over 55 years old, up from 20% 10 years ago. And they are ageing faster than the population as a whole - 39% of them are 60 or older, compared with 30% of Germans overall. "Never since we began to monitor business successions have so many small and medium-sized enterprises considered giving up their operations," said KfW's Mittelstand expert Michael Schwartz. SMEs account for more than half of Germany's economic output and almost 60% of jobs, and are an engine of private investment. The succession problem "not only threatens jobs but also weakens Germany's economic position overall," Marc S. Tenbieg, head of the DMB Mittelstand association, told Reuters. Although the new government wants to boost investment with an infrastructure fund, corporate tax cuts and advantageous depreciation options, businesses may be reluctant to commit without clarity about their future leadership. Carsten Brzeski, global head of macro at ING, cited studies showing under-investment of 400 to 600 million euros ($457-686 million) in Germany over the last decade. "Investments are held back as business owners cannot find adequate succession planning," Brzeski said. Before February's election, the Commission for Business Succession of another Mittelstand association, BVMW, made recommendations to address the problem, including tax incentives for business transfers and ways to improve financing conditions. "The new government plans very little on this issue according to the coalition agreement, where the term 'business succession' does not appear at all," said Benno Packi, chairman of the commission. A economy ministry spokesperson said the government has been supporting business successions with numerous measures, such as a free website to match owners with potential buyers, and loan offers with reduced interest rates. A smaller pool of internal candidates can make it hard to find talent, especially if larger companies offer more competitive packages, said Oliver Stettes, head of labour economics at the IW economic institute. Germany already has an acute shortage of skilled workers. But the succession squeeze also has an impact on bigger firms, nearly all of which have small companies as suppliers that would be hard to replace. Candidate scarcity can make what is often an emotional transition more challenging, said Holger Wassermann, an expert in company successions. "Psychology makes up at least two-thirds of the considerations in Mittelstand business sales," Wassermann said. "For many entrepreneurs, their company feels like a body part - selling it can feel like losing an arm." The average age of those handing over increased to 63 years from 61.5 years last year, while the age of those taking charge was static at 38 years, according to a Successions Monitor in which Wassermann participates. Marcel Krieb is an outlier. At just 25, he became managing director of pretium associates, a financial consultancy for SMEs established in 2003, after working on a project with its founder. "He asked me at the right time if I could somehow succeed him in his company," Krieb told Reuters. "Many young people prefer the security of a steady paycheck and predictable future, rather than the uncertainty that comes with being self-employed." Many Mittelstand companies are family-owned but nowadays fewer sons and daughters are prepared to take over. A survey by the Ifo Institute found 42% do not have a family member lined up to succeed. Jacob von der Decken was 30 and his father 68 when Jacob took over the family's agricultural business in northern Germany last year, having discussed it periodically since he was 14. "It's a lot of responsibility going on your shoulders," said von der Decken, who studied agricultural economics and had been working on renewable energy projects at a fintech company. "In agriculture, your family lends you the farm for one generation, and then you pass it on to the next generation. You have like 30 years of bringing it forward and making sure that it also lasts the next decades." While his father's generation prioritised efficiency, he is focusing on diversification and leveraging AI for data collection through a startup, Tunen Agronomy. Private equity takeovers, often mooted as a solution, are really only an option for larger Mittelstand firms, said Michael Wolff, an M&A expert at investment bank Stifel who specializes in transactions for companies valued at 100-500 million euros. "For the craftsman with 10 people or 20 workers ... So far there hasn't been a solution that systematically helps these people," Wolff said. And the Mittelstand's problems ripple widely. "With each small piece that breaks away, the foundation of the German economy becomes a bit more fragile," said pretium's Krieb. ($1 = 0.8877 euros)
Japan Times
02-06-2025
- Business
- Japan Times
Profitable Fukushima companies closing due to lack of successors
Many companies are shutting down in Fukushima Prefecture even though they are making a profit, due to the aging of managers who run the businesses and their failure to find successors. Data from Teikoku Databank's Fukushima branch shows that out of the 871 firms in the prefecture which discontinued, suspended or dissolved their business last year, 34.9% were in the black. They had to close down because they could not find a way to proceed with business succession smoothly. Experts warn that such business closures are likely to increase in the future amid labor shortage caused by the aging of society and a declining birth rate. They call for more effective measures to tackle the situation, as it could lead to a decline of the regional economy. Reflecting companies' struggles to find successors, the number of inquiries made to a business succession support center, set up in the prefecture by the central government, has been rising every year, reaching 1,156 in fiscal 2023, the latest available data. However, it has not always been easy for people looking for successors and those wishing to take over their businesses to reach agreement, because of mismatches in conditions or career interests. Meanwhile, there have been cases across the country in which companies in metropolitan areas purchase firms in regional areas, then abandon the management at the regional firm and become unreachable, indicating uncertainties in business successions involving wider areas. 'It is important for proprietors themselves to look for potential successors from their immediate surroundings, including their clients,' said an official from Teikoku Databank. The aging of business owners in Fukushima Prefecture is also becoming a bigger problem. According to a 2023 Teikoku Databank survey, the average age of company presidents in the prefecture was 61.3 years old, hitting a record high and topping the nationwide average of 60.7 years old. More than 80% of business owners in Fukushima Prefecture were 50 years old or older, and 4.8% were 80 or older. A nationwide survey conducted last year found that 316 firms in Japan went bankrupt because their owners fell ill or died. A Teikoku Databank official pointed to the need to take prompt action to prepare for unforeseen circumstances. Kimihiro Matsuzaki, 79, the owner of Yanagi, a Japanese restaurant located in front of Iwaki Station in Iwaki, Fukushima Prefecture, is one such person looking for someone to take over their business. The restaurant has been in the black, attracting a lot of customers, but Matsuzaki decided to retire this summer due to his advanced age. He is looking for a person who will take over the business, which he has run for half a century since 1974. 'I desperately want someone to continue what I have achieved,' he said. His specialty dishes using fish caught off the coast of Fukushima Prefecture, including bonito sashimi and anglerfish hot pot, are listed on the restaurant's menu. 'My happiest moment is when I see my customers leave with smiles,' Matsuzaki said. He looks serious when he cooks food, but seeing people cheerfully enjoying his dishes makes him smile at times. Matsuzaki opened his restaurant in Iwaki at the age of 29 after five years of training as a chef. His eatery and his friendliness have been appreciated by many people. 'There were tough days, especially at the time of the Great East Japan Earthquake, tsunami and the Fukushima No. 1 nuclear power plant accident, but I didn't want to quit as customers continued to come," he said. As he is nearly 80, however, he feels that his physical strength is nearing its limit. If he can find a successor, he is willing to sell his restaurant at an affordable price. He hopes the successor will also inherit the name of the restaurant, meaning "willow" in Japanese, as he took the name after willow branches that can weather storms, being able to bend instead of break. "People visit Iwaki and enjoy the food. I don't want such places to disappear." This section features topics and issues covered by the Fukushima Minpo, the prefecture's largest newspaper. The original article was published May 9.
