German SME owners see rising expectations for business succession prices

Data from KfW Research indicates a significant rise in the expected sale prices for medium-sized businesses in Germany. Entrepreneurs planning a succession within the next five years are now expecting an average sale price of 499,000 euros, up from 372,000 euros in 2019.

The median expected price has seen an even sharper increase, rising from 175,000 euros to 375,000 euros over the same period. Furthermore, more than one in four entrepreneurs now anticipates a purchase price exceeding one million euros.

Wichard von Alvensleben, Managing Director of WIRTSCHAFTSWUNDER Consulting GmbH & Co. KG, notes that owners often view their life's work through a personal lens that differs from a buyer's perspective. He emphasizes the necessity of establishing an economically sound valuation early in the process to ensure the price is manageable for buyers and sustainable for the company's future development.