“Forum Mittelstand” Business Get-together
Retiring from active working life and the changes that this involves bring a range of challenges to those taking leave as well as to the companies affected. Organizing the succession of senior managers effectively requires patience and careful planning. And if succession involves a small or medium-sized business, taking leave of an executive position is also very often an emotional farewell. Anyone selling their own business or passing it on to new blood will automatically look back on their own life’s work.
Since the process of securing a lifetime’s achievements and succession planning inside and outside of entrepreneurial families is undergoing change, and as new rules for inheritance tax are currently being introduced, the second “Forum Mittelstand” (“SME Forum”) held on November 10, 2016, addressed a red-hot topic: “Securing a Lifetime’s Achievement. The Current Need for Action in Terms of Finance, Law and Tax”. The large number of attendees once again indicated the great practical relevance of the chosen topic.
Following an opening address from organizers Professor Dr. Christina Günther, holder of the IHK Chair for Small and Medium-sized Enterprises at WHU, and Ralf Lawaczek, Managing Director of the Koblenz Chamber of Commerce and Industry (IHK), Dr. Andreas Fromm, an attorney and tax adviser specializing in tax law, gave a fascinating presentation about the key points for drawing up strategic plans for family and non-family succession in the areas of finance, law and tax. Fromm succeeded in bringing to life a complex subject embracing various fields of activity in a vivid and understandable manner. Making reference to sometimes amusing and sometimes surprising real-life cases, he pointed out potential pitfalls and provided concrete tips and tricks on how to steer clear of frequent and avoidable, and in some cases catastrophic, planning mistakes. He said there was too often a “veneer of precision” in succession planning. The impression that everything was well taken care of often arose from planning that is too detailed where the overall picture was lost from view. Fromm used a succession matrix that he had developed himself to illustrate succession planning systematically with regard to all the relevant issues, including obvious areas like business analysis and inheritance law as well as other factors that need to be taken into consideration like emotion and psychology.
Thomas Paul from asset managers Böcker & Paul AG warned of excessive carelessness in planning succession. The widespread assumption among businesspeople that “my business is retirement provision” was often not thought through to the end. Taking the example of an average entrepreneurial family, he showed impressively how existing assets can develop in various scenarios following retirement. In these scenarios he considered family and non-family handover as well as selling the business. He advised the businesspeople present to keep a cool head and to gain an overall picture of the situation of their own companies at an early stage. He listed the most frequent mistakes made by German businesspeople with regard to succession and retirement planning as too little formation of personal wealth, inadequate contractual arrangements, and incorrect preparation for the actual handover.
In the traditional agenda item that then followed, “Businesspeople in Dialog”, Hans-Jörg Platz, Managing Director of Hunsrück Sondertransport GmbH, and Dr. Antje Eckel, Managing Director of Dr. Eckel Animal Nutrition GmbH & Co. KG, discussed their thoughts about succession in their own companies with the audience.
The goal of Forum Mittelstand is to provide practical and specialist information on the latest academic insights to small and medium-sized enterprises in the region on a regular basis, and in this way to make a real contribution towards increasing the economic and innovative clout of local businesses. The next Forum Mittelstand will take place in spring 2017.