Ruck/Bernkopf: Succession planning ensures the future of businesses

The Vienna Economic Chamber, Bank Austria, the Federal Ministry of Science, Research and Economy, and the Austrian Institute for Economic Promotion have developed an SME business value calculator. Business owners can calculate the value of their company free of charge, better preparing for sale or transfer.

According to a study by the Austrian Institute for SME Research, some 10,000 small and medium-sized enterprises (SMEs) in Vienna with close to 100,000 employees will be transferred to new owners by 2021. But it is often especially difficult for owners of SMEs to determine a realistic value for their business for the purposes of sale or transfer.

To assist companies that are to be transferred or sold, the Vienna Economic Chamber, Bank Austria, the Federal Ministry of Science, Research and Economy, and the Austrian Institute for Economic Promotion (WIFI) have created a business value calculator for SMEs. This tool provides a guideline for the market value of a business and shows how this value can be increased before sale or transfer. The program can be accessed on the Internet at  http://wko.at/wien/kmu-unternehmenswert or  http://www.servicetools.bankaustria.at/ free of charge.

"Tens of thousands of business owners will be selling or transferring their companies in the next few years. Their negotiating position is much better if they know what their company is really worth. Early planning and transparent management and business practices are also key factors in successfully transferring a company. The business value calculator will help to make sometimes complicated business transfers considerably easier," said Walter Ruck, president of the Vienna Economic Chamber.

"One of our most important activities is the continuous development of innovative services for small and medium-sized enterprises," stressed Helmut Bernkopf, Bank Austria's Management Board member for private and corporate customers. "The SME business value calculator extends our broad range of innovative service tools that also includes the BusinessPlanner, the RatingBeratung rating advisory service, and the BranchenCheck industry benchmarking tool. Owners of SMEs often find it difficult to complete the necessary planning, and we can help with this. The SME business value calculator provides business owners with an important basis for succession planning or the planned sale of their company."

The calculator is very user friendly and simple to use. It applies a practical system to calculate a plausible market value using key information from the balance sheet and income statement. It accounts for important aspects such as the sustainability of the sector and products, the scope and quality of the customer base, and future profit potential. The calculator can be used by business applying single-entry or double-entry accounting.

The SME business value calculator offers

• An estimate of the current market value of a company
• Help deciding how and when a company transfer or sale would be sensible
• Inputs for creating a long-term business plan
• The possibility to identify weaknesses and potential in the business
• The opportunity to improve business planning in good time to increase the value of the company
• A simple and user friendly interface

Helmut Bernkopf added, "For most business owners, their company is their life's work. This is reason enough to plan any transfer or sale carefully. Our calculator is a professional tool that provides an overview of the value of a business. We can naturally also offer specialised succession planning advice on the basis of the calculator's results."

For Ruck, the business value calculator makes a key contribution to helping small and medium-sized enterprises: "More businesses are transferred in Vienna than anywhere else in Austria. A successful transfer preserves know-how and jobs, and that is good for the city as a business location." The business value calculator also expands the services offered by the Vienna Economic Chamber, which set up an ombudsman's office for business financing in November 2008. The goal of this office is to offer Viennese businesses assistance with finding solutions for all matters of financing (balance sheet and credit rating analyses, debt restructuring, government funding, loans, and more). The ombudsman's office has received close to 6,000 enquiries since it opened.

Martin Sattler
Press and Media Management
Vienna Economic Chamber
Stubenring 8–10  I A- 1010 Vienna
Tel: +43 (0)1 51450 - 1585 
Fax +43 (0)1 51450 - 1470
e-mail:  martin.sattler@wkw.at

Matthias Raftl
Press Office Austria
UniCredit Bank Austria
Schottengasse 6–8   I  A-1010 Wien
Tel.: +43 (0) 50505 - 52809
Fax +43 (0) 50505 - 8952809 
e-mail matthias.raftl@unicreditgroup.at