Unsuccessful SME Business Transfers

Business transfers are linked to both the beginning and the end of entrepreneurial processes. A person can become an entrepreneur by acquiring an existing business instead of starting one, and exit from entrepreneurship can occur through selling the business. Business transfers are gradually becoming more common among small businesses, largely due to entrepreneurs' aging, and thus deserve attention from entrepreneurship scholars. In particular, the issue of why and how business transfer negotiations fail without achieving a transfer has received little research attention. The purpose of this paper is to explore this phenomenon from potential buyers' and sellers' perspectives. The findings are based on a sample of 156 responses. The results suggest that the problems occurring in unfinished business transfers are quite numerous and the gaps between the views of the two negotiating parties are wider than in cases where business transfer negotiations are concluded successfully, indicating that the initial negotiation positions can be crucial. This research proposes some key elements to consider when planning an exit by business transfer and highlight the importance of unfinished small business transfers as an essential element of a dynamic business transfer market; a substantial proportion of the potential buyers and sellers are satisfied with the outcome even though the transfer did not occur.