Switzerland’s economic fabric rests on its small and medium-sized enterprises. They are its backbone: more than 99% of the country’s businesses are SMEs, and they generate two-thirds of jobs, or around three million people, according to the Federal Statistical Office. Yet behind this success lies a structural challenge of unprecedented scale. In the years ahead, tens of thousands of business leaders will reach retirement age. According to a 2024 Dun & Bradstreet study, more than 101,000 companies are currently looking for a successor; a trend directly tied to the ageing of business owners and the retirement of the baby-boom generation. Passing on an SME is not just about a change at the top: it affects the future of dozens of jobs, sometimes a regional skill base and, in some cases, a family legacy built over several generations.

Historically, the handover of Swiss SMEs took place mainly within the family. That model remains significant, but it is evolving: according to data from the Confederation’s official SME portal, around 42% of businesses are still transferred to a direct descendant, while 23% go to internal managers or partners. This shift is driven by several converging factors: younger generations do not always want to take over the family business, management requirements have changed significantly, and running an SME now means mastering complex issues such as digitalisation, the energy transition, international expansion and talent management. Internal succession by senior managers, or a management buyout, is therefore gaining ground, allowing the outgoing founder to gradually hand over responsibilities while ensuring strategic continuity, even if the required financing can prove a hurdle. Beyond these two traditional routes, new profiles are emerging: entrepreneurs who prefer to acquire an existing business rather than launch a start-up, investors or industrial groups seeking to consolidate a sector, and funds specialising in SME acquisitions. The succession market has become more professional, supported by a powerful argument: according to the Confederation’s official SME portal, the five-year survival rate of an acquired business reaches 95%, versus 50% for a company created from scratch. Despite this widening range of solutions, the risk of disappearance remains real: one SME in three closes for lack of a buyer when its leader retires, a phenomenon that affects above all smaller businesses heavily dependent on their founder, where skills, commercial relationships and reputation often rest on a single person.

Beyond the figures and legal structures, the transfer of an SME is прежде всего a human test. For an entrepreneur who has spent twenty or thirty years building a company, handing over the reins touches on something far deeper than a simple management decision: it is often a challenge to identity, the grieving of a social role, and sometimes the end of a life project. Advisers involved in succession planning report that it is precisely these psychological barriers, rather than technical or financial obstacles, that most often explain delays and deadlock. In family businesses, the emotional dimension is even more intense: to pass on the company is to hand over a name, a history, sometimes the work of several generations. Yet this emotional burden has a direct economic cost. Most business owners tend to overestimate the value of their company: the gap between the value perceived by the seller and that retained by an independent expert can reach 30% to 50% in some cases. SME valuation relies on tried-and-tested methods: net asset value, EBITDA multiples, generally between three and six times operating profit depending on the sector, or discounted cash flows. But beyond the tools, it is often the company’s ability to operate without its founder that determines its true value in the eyes of a buyer. A structure that is too dependent on a single personality is mechanically valued lower, because the risk of client loss after the sale is real and quantifiable. That is why succession advisers recommend starting, several years before the transfer, a thorough process of delegation, documentation of procedures and retention of key teams, all measures that translate directly into value at the time of sale.

The stakes go far beyond the individual interests of business owners. With more than 600,000 SMEs employing around three million people, the future of these companies underpins the country’s economic stability. A successful transfer preserves jobs and maintains a diverse, innovative business base; poorly prepared succession, by contrast, can weaken entire regions, especially in industrial or craft-based sectors. Yet according to a PwC study, 47% of family businesses have not yet taken any concrete steps in this direction, even though a succession process takes an average of five to seven years to prepare. Identifying a successor, organising the transfer of know-how, structuring financing and clarifying legal issues: all these steps require time and cannot be improvised. This wave of business transfers nevertheless presents an opportunity. A new generation of entrepreneurs could bring fresh ideas, accelerate digitalisation and open up new international markets. Family heirs will continue to play a role, internal managers will take on greater responsibilities, and new buyers will seize opportunities others pass on. The way this transition is managed will largely determine the country’s economic future. Because behind every SME lies far more than a business: a story, expertise and often a community that depends on its continuity.

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