What Advantages Does the Schleswig-Holstein Business Location Offer to Business Sellers?
Schleswig-Holstein, the land between the seas, as Germany’s northernmost federal state, offers unique location advantages for business sellers. With a gross domestic product of €106.7 billion (2023) and solid growth of 2.6% compared to the previous year, the state demonstrates stable economic development. This positive momentum creates a favorable environment for business sales and increases attractiveness for potential buyers.
The strategic position between the North and Baltic Seas, with direct access to Scandinavian markets, makes Schleswig-Holstein an important trade and logistics hub. The state capital Kiel, the port city of Lübeck, and proximity to the Hamburg metropolitan region provide excellent infrastructure for regional and international business relationships. These geographic advantages positively influence company valuations and enhance their appeal to prospective buyers.
A particular plus is the high quality of life Schleswig-Holstein offers with its coastal regions, natural landscapes, and cultural amenities. This so-called “soft location factor” is gaining importance in business acquisitions, as successors often link personal lifestyle decisions with the purchase of a company. The region’s attractiveness can therefore be a key argument in sales discussions and broaden the pool of potential interested parties.
What Is the Succession Situation in Schleswig-Holstein’s SME Sector?
The SME sector in Schleswig-Holstein comprises around 125,000 small and medium-sized enterprises, securing approximately 70% of all jobs in the state. According to surveys by the Chamber of Industry and Commerce (IHK) Schleswig-Holstein, about 7,500 of these companies face succession challenges within the next five years. This figure highlights the significant demand for suitable successors and the importance of early sales process planning.
Demographic trends further exacerbate the succession issue. With an average owner age over 50 and a simultaneous decline in potential successors within family circles, a growing market for external buyers is emerging. This opens opportunities for regional and international investors interested in taking over and developing existing business models.
The average equity ratio of companies in Schleswig-Holstein is 29.7%, providing a solid foundation for prospective buyers. However, succession searches in rural areas can be challenging. Here, supraregional marketing strategies are advisable to expand the pool of potential buyers.
Which Industries in Schleswig-Holstein Are Particularly Sought After for Business Acquisitions?
Schleswig-Holstein is characterized by a diverse economic structure, with certain industries attracting especially strong buyer interest:
The maritime economy, including shipyards, port operations, ship suppliers, and maritime tourism, forms a traditional focus. Companies in this sector benefit from the unique location between the North and Baltic Seas and established networks. Sales often achieve above-average valuations, especially when specialized expertise or long-term customer relationships are present.
Tourism, with its attractive coastal landscape and recreational areas, represents an important economic sector. Hotels, gastronomy, and leisure businesses, particularly in popular vacation regions along the North and Baltic Seas, attract keen interest from buyers looking to capitalize on the ongoing trend toward domestic tourism.
The food industry holds significant importance due to its proximity to high-quality agricultural products. Food producers and processors, especially those with regional specialties or organic orientation, are popular acquisition targets.
The renewable energy sector, particularly wind power, plays a pioneering role in Schleswig-Holstein. Favorable site conditions and political support for the energy transition ensure stable future prospects, making these companies especially attractive to buyers.
The healthcare sector, including medical facilities, clinics, and nursing homes, is gaining importance amid demographic changes. Companies in this area often achieve above-average valuations during sales.
How Is the Value of a Company Determined in Schleswig-Holstein?
The valuation of a company in Schleswig-Holstein follows established methods but also takes regional specifics into account:
The income approach forecasts the company’s future earnings and discounts them to present value. In Schleswig-Holstein, regional economic trends must be considered: companies in growth sectors such as tourism or renewable energies can benefit from positive future prospects.
The multiplier method uses industry-specific factors multiplied by key figures like EBIT or EBITDA. In Schleswig-Holstein, these multipliers vary significantly by sector: while companies in tourism and leisure are often valued with EBITDA multiples between 4.5 and 7, manufacturing companies typically range between 4 and 6.
The asset-based approach considers the tangible value of all assets minus liabilities. This method is particularly important for asset-intensive companies, such as accommodation businesses with owned real estate or those in the maritime economy.
For a sound valuation, consulting an experienced business appraiser familiar with regional market conditions is recommended. A professional valuation forms the basis for realistic price expectations and increases the likelihood of a successful sale.
What Support Can Sellers in Schleswig-Holstein Utilize?
Schleswig-Holstein offers an extensive network of support services for entrepreneurs looking to sell their business:
The Chambers of Industry and Commerce in Kiel, Lübeck, and Flensburg have dedicated succession advisors who assist in preparing the sale. The “Succession Center Schleswig-Holstein” consolidates these services and provides a central contact point for all succession-related questions.
The Chamber of Crafts Schleswig-Holstein has its own business consultants focused on business succession. They support company valuations and can connect sellers with suitable interested parties from their network.
The Investment Bank Schleswig-Holstein (IB.SH) offers special financing programs for business succession. These can benefit both sellers and buyers, for example, in structuring transition arrangements or financing the purchase price.
The Mittelständische Beteiligungsgesellschaft Schleswig-Holstein provides equity capital for succession financing, facilitating the sales process.
Specialized M&A advisors focusing on the northern German economic region possess valuable market knowledge and buyer networks. They can professionally manage the entire sales process and achieve an optimal sale price.
Online platforms like viaductus complement traditional buyer search methods and increase the chances of finding the right successor for your business in Schleswig-Holstein.
How to Optimize the Sales Process in Schleswig-Holstein?
Selling a business in Schleswig-Holstein follows a structured process that, with good preparation, leads to success:
The preparation phase should ideally begin 1-2 years before the planned sale. During this time, you can focus on optimizing your business: cleaning up the balance sheet, increasing profitability, clarifying legal issues, and documenting key processes and customer relationships.
Professionalism is essential when preparing the sales documents. A compelling sales prospectus presents your company optimally and contains all relevant information for potential buyers. An anonymized short profile (teaser) serves as the initial point of contact.
The buyer search is conducted discreetly and purposefully. In Schleswig-Holstein, besides traditional approaches like direct contact with strategic investors, regional networks and events such as the “Succession Day Schleswig-Holstein” are effective. Due to proximity to Hamburg and Scandinavia, supraregional and international buyers should also be considered.
After initial talks with interested buyers and signing a confidentiality agreement, the due diligence phase follows, during which the potential buyer thoroughly examines your company.
In the negotiation phase, purchase price, payment terms, and transition arrangements are determined. Special attention should be paid to the tax aspects of the transaction and the structuring of the purchase agreement.
A realistic timeframe for the entire sales process is generally 6 to 12 months. Professional support from M&A advisors, tax consultants, and lawyers can significantly facilitate this process.
What Tax Particularities Should Be Considered When Selling a Business in Schleswig-Holstein?
Selling a business has significant tax implications that can be optimized through early planning:
In an asset deal, i.e., the sale of individual company assets, profits are generally subject to income tax. Under certain conditions, however, exemptions under § 16 EStG can be utilized, especially if the seller is over 55 years old.
In a share deal, i.e., the sale of company shares, tax treatment depends on the legal form. For corporations, the partial income procedure applies, allowing 40% of capital gains to remain tax-free.
Schleswig-Holstein levies one of the highest real estate transfer tax rates in Germany at 6.5%. This is particularly relevant in real estate transactions within business sales, such as tourism and accommodation businesses owning property.
Establishing a holding structure before the sale can offer tax advantages and should be examined in advance. Utilizing reinvestment options under § 6b EStG can also reduce tax burdens.
For intrafamily transfers, special reliefs regarding inheritance and gift tax may apply. The transfer of business assets within the family can, under certain conditions, be largely tax-free.
Early consultation with specialized tax experts is essential to minimize tax liabilities when selling a business.
How to Leverage Proximity to Scandinavia and Hamburg for Business Sales?
Schleswig-Holstein’s geographic location between the Hamburg metropolitan region and Scandinavia offers special opportunities for business sellers that should be strategically utilized:
Scandinavian investors show increasing interest in acquisitions in Schleswig-Holstein, especially in sectors such as renewable energy, tourism, maritime economy, and healthcare. Cultural proximity and similar business mentalities facilitate cross-border transactions. Specialized M&A advisors with Scandinavian networks can specifically target this buyer group.
The immediate proximity to the economic hub of Hamburg provides access to a large pool of potential buyers. Many Hamburg-based companies actively seek expansion opportunities into the northernmost federal state to benefit from lower location costs while maintaining good accessibility.
When preparing for international buyers, sales documents should be multilingual (at least German and English, possibly also Danish or Swedish). Presenting financial figures in an internationally understandable format can also be helpful.
Regional cooperation networks such as the “Enterprise Europe Network Schleswig-Holstein” or the “Fehmarnbelt Business Council” offer platforms to establish cross-border contacts with potential buyers. These networks can be strategically used to find suitable successors.
Effectively leveraging the international dimension of Schleswig-Holstein’s business location can broaden the buyer base and thus increase the chances of achieving an optimal sale price.