The 'Experience' of People in Their 50s and 60s Can Save Local Regions. The Option of Business Succession
Kei Takahashi, Representative of Pro-Jinzai Kiko
The other day, I held a seminar on the theme of business succession. It was an evening that made me realize once again the high level of interest in the business succession industry, as over 50 people gathered to attend.
I will organize some of the content I spoke about there here.
The reason I started this job
As a headhunter, I have been involved in introducing management talent for about 20 years. In the beginning, it was mainly business revitalization, such as bus companies and textile manufacturers. It was a job of finding managers to take charge of turning around companies with poor performance.
The turning point came around 2015. Requests from tax accountants to 'find a successor' began to increase. Following the 2018 tax reform regarding business succession, 'business succession' has now become the core of my business.
And I have realized something. The market for business succession isvery compatible with the senior demographic.
Even without doing anything, I receive over 10 inquiries every month
Let me talk a little about the numbers.
There are 2.45 million small and medium-sized enterprise owners aged 70 or older. There are 1.27 million companies without a decided successor. I think you often hear these numbers. But what I am experiencing is a more realistic story.
Currently, my company receives about 150 inquiries a yearwithout cold calling or advertising. These are requests from tax accountants, local financial institutions, and investment funds—'Please find someone to take over our client's company.'
The number of successful deals nationwide at the Takeover Support Centers operated by the Small and Medium Enterprise Agency reached a record high of 2,132 (2024 actual figures). Third-party succession is increasing across Japan as well. However, cases via the Takeover Support Centers are often relatively small in scale.
The ones that come to me are mainly cases with a bit more scale.
The main players are in their 50s. But those in their 60s are starting to grow.
Looking at our company's closing data, about80% of those who take office as successors are in their 50s. And recently, closings for people in their 60s have increased. Some people might have the image that 'business succession is a job for young people.' But the reality is different. The job of taking over the management of a company without a successor is one wherethe more depth of experience you have, the stronger you are.
The story of the man who visited a snack bar in Choshi five times
Here, I would like to introduce a success story. A person living in Tokyo with a background in a foreign-affiliated company was assigned as the successor to an automobile maintenance factory (with about 10 employees) in a local region. It was a transfer away from his family, even with children. Why was he able to make the decision? He later told me it was because 'I came to love the town.'
However, there was preparation for that 'love.' Before taking the position, he actually visited the area 5 or 6 times. And he went to a local snack bar and talked to the regulars. He confirmed the temperament of the local people with his own body. This initiative is amazing, isn't it?
People who fail have common traits.
On the other hand, there are honestly cases that do not go well.
1. Logic-first type
2. Type that brings in metropolitan rules
3. Type that becomes isolated without breaking their own mold.
Among them, the most common is the language problem. People from large companies unconsciously use words like 'marketing' and 'PDCA.' But for employees who graduated from local schools and have worked at that company, katakana words from an outsider do not get through.
When words don't get through, conversations decrease. When conversations decrease, you become isolated. I have seen several people who were actually driven into a corner mentally.
Successful successors have three things in common.
Can talk about their own failures
Can translate into the other party's language
Integrating into the local community
It is simple, but I believe this is everything.
There are companies in regional areas that need your knowledge.
Finally, there is one thing I would like to tell you.
There are companies in regional areas that need your knowledge. They have wonderful technology, yet they are not well-recognized by the world. They could be more efficient. They could be doing more business with major companies. There are many such companies.
And that experience is not yours alone. It is something inherited from predecessors, time supported by family, and things built up through relationships with hundreds of customers and colleagues. It would be a waste to let it end with just your generation.
Nowadays, business succession work does not require full-time employment. Involvement on a weekly or bi-weekly basis is not uncommon. In a deal closed last month, a person from Tokyo realized a work style where they traveled to Fukushima for the first half of the week and worked in Tokyo for the second half.
One last thing I want to convey to everyone: third-party succession is a realistic path for those in their 50s and 60s to 'give back their experience to society'.
Please, take the initiative and challenge yourself.
Pro Human Resources Organization conducts headhunting specializing in senior and management-level personnel. Please feel free to consult us regarding business succession.
