“The challenge is to reach out to young people!”

By 2022, nearly 6% of Quebec businesses, or 15,000 of them, intend to transfer in the very short term, according to 2020 data from Statistics Canada. The pandemic has accelerated this phenomenon, which has doubled. Louise Cadieux, full professor in the management department of the UQTR School of Management, explains: "The current challenge is to attract young people who are not sufficiently familiar with this option."

According to the assessment by the Centre de transfert d'entreprise du Québec (CTEQ), the number would rather climb to 37,000 if we take into account the famous baby boom. The demographic wave is catching up with the founding owners who are aging. Louise Cadieux clarifies: "Companies looking for successors are not necessarily those that are out of breath. An owner in their sixties who saw their turnover increase tenfold during the pandemic is also ready to sell." Among the sectors of activity currently experiencing the most renewal are agriculture, restaurants, accommodation, tourism, retail and manufacturing.

Sometimes it's better to start again!

Entrepreneurial spirit, a taste for risk, creativity and commitment are among the skills required for entrepreneurship in all its forms. The acquisition of a company is no exception. The takeover of an existing company is a guarantee of success in itself: the survival rate is higher than for business creations.

"Taking over a business is also about entrepreneurship!", emphasizes Ms. Cadieux. There are fewer risks than starting with a simple idea without knowing whether it is feasible or how the market will react. The buyer buys a name and a reputation. He acquires an established company, he does not need to go looking for customers, to develop his market. For financial institutions, there is also generally a good guarantee of assets, in particular with the premises and equipment." The quality of the entrepreneurial project is today what is most important for access to financing: the price of the transaction and how it was modulated, but also qualitative considerations such as the clarity of the vision and the future prospects of the buyer(s), their relationships, the human capital within the company, the differentiation strategy and market opportunities.

The stakes are above all human

In addition to the legal, accounting and tax issues, the challenges of the takeover are above all human, according to the expert. "Upstream, beyond the negotiations, there is an immense challenge of letting go for the transferor," she explains. "Even if he is ready to leave, the emotional burden of passing on what he has built over the years and leaving the employees who have supported him remains significant." He must accept that the buyer is not his exact copy and will not necessarily do things the same way he does.

"It's probably a good idea for the founder not to set a departure date, the concept of time is elastic and different for everyone," smiles Mrs. Cadieux. In the context of a family handover, let's add particular personal dynamics and know that the transfer will be longer, perhaps 5 to 10 years.

The researcher believes that the key to success lies in the quality of the relationship between the transferor and the transferee throughout the process. "The famous good fit takes on its full meaning here," she says. "You have to want to work together for a long time and put in place a clear transfer plan. Sustaining your business is not a straight line, it is very complex, but it is worth it."

This is a real change management that must take place at several levels. As such, the CTEQ establishes a diagnosis and redirects to other specialized stakeholders. "Trust and transparency are essential for the successful transmission of knowledge, as well as the success of the post-recovery," she assures. This final phase is often neglected in support while it remains fragile and everything remains to be done.

*Training:

– CTEQ Success-Success

– HEC and Universities (notably Trois-Rivières and Sherbrooke)

– Business Support Services (SAE) of School Boards

– Beauce School of Entrepreneurship

– Quebec School of Entrepreneurship

– Oria Agency

*Where to find businesses for sale?

– CTEQ Index

– Business brokers dedicated to the sale of businesses

– Financial institutions

– Business networks