Generational Change in the German Mittelstand: 186,000 Companies Facing Succession
29.05.2026 – Frankfurt/Main
The German Mittelstand is confronting one of the largest structural challenges in its recent history. According to current estimates from the Institut für Mittelstandsforschung Bonn (IfM Bonn), around 186,000 companies will require a successor over the coming five years, as their owners step down from management for reasons of age, health, or other personal circumstances. This figure describes a structural wave with concrete consequences for employment, market structures, and the economic substance of Germany as a business location.
More willingness to hand over, fewer completed transfers
A striking feature of the current IfM Bonn estimate is an apparent paradox. Although the number of owners willing to hand over is rising, the number of expected successions is around 800 companies lower each year than in the previous estimate period of 2022 to 2026. The explanation is economic. Many mid-sized companies are contending with weaker earnings, which makes a takeover appear less attractive from the perspective of potential successors. The companies most affected are those in business-related services with annual turnover below 500,000 euros. An owner handing over a company whose profitability has eroded in recent years finds it harder to identify a successor and, in case of doubt, achieves a lower sale price.
Family succession is losing its taken-for-granted status
The second, quieter shift is cultural in nature. While in 2018, 57 percent of entrepreneurs were aiming for an intra-family succession, by 2025 this share had fallen below 42 percent. The succeeding generation is smaller in number, more broadly educated, and more selective in its career decisions. Running the family Mittelstand business today stands in open competition with corporate careers, start-up ventures, and alternative life paths. Owners who assume the next generation will automatically take over lose valuable preparation time. External succession solutions, meaning classical M&A processes with professional support, are accordingly gaining in importance.
Why preparation matters now
The wave of 186,000 pending successions is not an abstract future scenario but a concrete market phenomenon that will intensify in the coming years. For business owners, this carries a twofold consequence. First, competition among sellers will rise. The more companies looking for a successor at the same time, the more selectively buyers and investors will act. Second, effective preparation time lengthens. A company intended for sale should ideally be prepared structurally, financially, and operationally two to three years before the planned handover. That window is lost when the process is only initiated once the owner’s exit is already imminent.
Edelweiss Corporate Finance accompanies mid-sized businesses from the first strategic assessment through valuation to a successful handover. Confidential, well-founded, and at your side.
