By Mira-Maria Kontkanen, Member of the EESC's Employers' Group

Compared to start-ups, businesses that are successfully transferred perform better in terms of survival, turnover, profit, innovation and employment. While there is good reason to support Europe's start-up entrepreneurs, business transfers need to be equally promoted on Europe's path to recovery and growth.

A change of ownership is a natural part of a company's lifecycle and becomes more and more relevant as European entrepreneurs age. Approximately 450 000 firms with 2 million employees are transferred in Europe each year. However, it is estimated that every year, around 150 000 businesses risk unsuccessful transfers, endangering around 600 000 jobs.
Increasing the number of successful business transfers has immediate benefits for the European economy. Well-functioning business transfer ecosystems and support mechanisms not only safeguard European jobs, but also promote economic and social cohesion in rural areas and ensure a variety of products and services, as well as livelihoods in these areas. Business transfers can also facilitate and boost the green and digital transition of European MSMEs, as a transfer of ownership is often a natural time to renew the company and adopt new ways of doing business.

Even though the final responsibility of the business transfer lies with the entrepreneur, there is more to be done at Member State and European level to increase the number of successful business transfers, including:

• awareness-raising activities, such a establishing a business transfer promotion week and national business transfer stakeholder forums;
• establishing an EU-wide business transfer barometer to support evidence-based policy-making, both at European and national level;
• embedding know-how on buying a firm and on succession into entrepreneurship education, and developing incentives for the transfer of small firms to young entrepreneurs;
• developing cross-border MSME transfers, for instance though interlinkages between business transfer marketplaces across the EU.

Europe should aim to reach a point whereby acquiring an existing business is an equally attractive and recognised opportunity as being a start-up entrepreneur. This can only be done if the EU and Member States put business transfer promotion at the heart of their recovery, growth and entrepreneurship policies.

Find the full article in the September edition of the Employers' Group Newsletter. The EESC opinion on Business transfers as promoters of sustainable recovery growth in the SME sector, for which Ms Kontkanen was rapporteur, can be found here.