Research-based awareness raising for SME business transfers in Finland

Objectives. The main objective of this paper is to increase understanding about the role of a business transfer barometer, implemented by a university, as a significant awareness raising activity and hence an important part of a well-developed business transfer ecosystem. In addition, the objective is to introduce an example of business transfer barometer including the key results of it. Literature Review. The European Commission estimates that approximately 450 000 firms are being transferred each year in the EU27-countries. The annual number of business transfers is relatively small compared to the number of exits or start-ups. However, successfully transferred businesses outperform start-ups with respect to survival, turnover, profit, innovativeness and employment. Awareness raising usually refers mainly to activities related to sellers and buyers at the pre phase of a business transfer process. The aim of awareness raising is generally to promote earlier planning and thus increase preparedness for business transfer. The motivation for developing awareness raising has traditionally been related to the aging of entrepreneurs and the need to ensure the continuity of healthy firms. However, as researchers and policy makers increasingly view business transfers as a vital part of safeguarding healthy dynamics in the economy, awareness raising activities also seek to promote business transfers as a normal strategic action of firms and to strengthen the business transfer culture. Approach. The barometer data was collected in May 2015 by a web-based survey to the members of the Federation of Finnish Enterprises. The target group consisted of entrepreneurs in the age group of 55 years or more. Altogether 1 786 responses were received. Results. According to the barometer results, 39 % of the respondents are planning to sell the firm to an outside buyer at the time when they give up the main responsibility. 27 % are planning to close down the firm whereas 23 % believe they will find a successor within the family. The potential sellers considered finding a buyer or successor as the biggest challenge of business transfer. Valuation was considered the second greatest challenge. Numerous awareness raising activities were linked in some way to the barometer. The barometer has an impact within the Finnish business transfer ecosystem, both increasing awareness and improving the knowledge-base for policy. Implications. The barometer had three different types of awareness raising impacts: the implementation of the survey served as awareness raising, the results could be leveraged in further awareness raising activities and, on a system level, the barometer enables evidence based policy making. Multiplier effects cannot, however, be achieved without a long-term perspective and a systematic approach to business transfer awareness raising. In order to improve coordination and to facilitate the development of long term information gathering systems and effectiveness measures, national advisory boards on business transfers should be considered. Key organizations must be committed to the goal of developing and maintaining a dynamic business transfer ecosystem. Business transfers are a practical way to start, develop and grow businesses. Therefore, it is very important that a systematic and long term approach to implementing business transfer awareness raising activities should be adopted.