For many master craftsmen and business owners, the time will come sooner or later when they need to consider selling their company. Whether due to age, health reasons, or because their children choose different career paths—the sale of a craft business is a complex matter that requires careful planning.
Don’t Underestimate the Emotional Component
A craft business is often much more than just a company. It is a life’s work into which years or even decades of passion, time, and energy have been invested. Many owners strongly identify with their business and have built close personal relationships with employees and customers.
The thought of letting go of this legacy and handing it over to someone else is difficult for many. It is not uncommon for fears about the future and concerns about whether the successor will continue the business in the owner’s spirit to arise.
These emotional aspects of the sales process are often underestimated. Yet, they are a crucial factor for a successful handover. An early engagement with one’s own feelings and open communication with family and trusted confidants can help mentally navigate the process.
The Challenge of Business Valuation
A central and often contentious issue in the sale of a business is determining the right price. Especially in craft businesses, the true value often lies in intangible factors such as employee expertise, customer relationships, or a strong reputation.
Quantifying these factors is challenging. Traditional valuation methods like the multiplier method quickly reach their limits. Even discounted cash flow methods are often unsuitable due to the difficulty of forecasting.
All the more important is to include non-financial value drivers in the valuation. The age structure and qualifications of employees, the technical equipment of the business, the quality of customer relationships—all of these play a role.
However, it is also essential to critically question your own price expectations. An overly high valuation can quickly deter potential buyers. Here, the assessment of external M&A advisors can provide valuable guidance.
Read more about valuing craft businesses in our article Properly Valuing and Selling Craft Businesses.
Finding the Right Successor
Knowing that your life’s work will be in good hands is a top priority for most owners. However, the market for potential successors is often limited, especially in the craft sector.
An early and broad search increases the chances of finding the right buyer. In addition to strategic investors from the industry, own employees, competitors, or buyers from other industries may also be considered.
However, the search must be conducted discreetly and with sensitivity. A public listing can quickly cause unrest among employees, customers, and suppliers. Anonymous ads on online platforms or engaging an M&A advisor promise greater success here.
Above all, a thorough evaluation of candidates is crucial. Do company philosophy and values align? Does the successor have the necessary professional and personal qualifications? These questions must be answered honestly before formal negotiations begin.
Managing the Internal Handover
Once the right successor is found, the focus shifts to the concrete transfer of responsibility. In craft businesses, the training and integration of employees play a central role.
Many owners underestimate the uncertainty a leadership change can trigger. Here, early communication and involvement of the workforce are essential. The more transparently you communicate and the more employees can participate, the smoother the transition will be.
Technical and organizational processes also need to be well prepared. A complete documentation of workflows and processes greatly facilitates the successor’s onboarding. Neglecting this in the past can quickly become a problem.
Last but not least, it is important to keep an eye on the legal and tax aspects of the handover. Depending on the legal form and the structure of the sale, many details must be considered. Engaging a specialized tax advisor and attorney helps avoid unpleasant surprises.
Conclusion
Selling a craft business is an emotional and challenging task for many owners. This makes early and careful planning all the more important. Structured preparation, realistic valuation, and choosing the right successor are key success factors.
Do not hesitate to rely on the support of external experts. Experienced M&A advisors can provide valuable insights, streamline the process, and lead negotiations to success. Tax advisors, lawyers, and coaches also provide essential services during the sale.
With the right preparation and guidance, the handover of your craft business can succeed, ensuring your life’s work continues to thrive. Our experts are happy to advise you on all questions related to selling your business.