Sector
Succession in business services: buying and selling IT, property management and consultancies
In service firms, the value often sits in people's heads and relationships. The handover works when both are spread across more shoulders in good time.
As of October 2026 · An overview, not legal or tax advice.
In short
According to the DIHK's 2025 report, business services have about twice as many firms up for succession as there are interested buyers. IT businesses show a similar ratio.
The difficulty: services are often tailored to clients, and trust rests with the owner. A shared transition period and a price partly tied to results help both sides.
- 01
Where the value of a service firm lies
This covers engineering and planning offices, IT service providers, agencies, property managers and inspection or maintenance firms. The chambers describe know-how and trust that have grown over years and are hard to transfer.
Many service firms also depend on other sectors: they work for manufacturers and feel their situation directly. A buyer should know how broad the client base really is.
- 02
Three routes to succession
A business can stay in the family, pass to employees or be sold to an outsider.
Succession routes compared Route Strengths and hurdles Within the family Trust and continuity. Hurdles: family expectations, a fair deal for siblings, often limited funds. To employees (management buy-out) Knows the business, team and customers. Hurdles: little equity, the shift from colleague to boss. To an outsider (sale or management buy-in) Fresh ideas and usually a fair market price. Hurdles: the search takes time, team and customers need to build trust. According to KfW's succession monitor, most Mittelstand owners would prefer a family solution, followed by a sale to outsiders. Management buy-outs have recently been planned more often again.
KfW succession monitor 2025, PDF (in German) · Glossary: management buy-in
- 03
Buying a service business: how to go about it
A takeover has no fixed timetable, but these steps almost always come up:
- 01Decide which kind of service business (property management, IT, engineering, agency), region and size suit you
- 02Search: the nexxt-change marketplace, chamber of commerce succession advice, tax advisers, banks and personal contacts
- 03First meeting with the owner, then a confidentiality agreement and documents
- 04Due diligence: client base and contracts, dependence on the owner, key people in the team
- 05Negotiate value and price, arrange financing with your bank, KfW and a guarantee bank
- 06Purchase agreement, informing employees under § 613a of the Civil Code, a shared transition period
nexxt-change marketplace (in German) · § 613a BGB (in German)
- 04
Selling a service business: preparing the handover
Succession works when not only the successor is prepared, but the business too. These steps help:
- 01Set your goal and timeframe: when do you want to stop, and what matters to you besides the price?
- 02Make the business less dependent on you: second contacts, written processes
- 03Get clients used to second contacts and put framework agreements in place
- 04Put the figures in order and have the value assessed realistically
- 05Look for successors discreetly, with a short, anonymous business profile
- 06Involve your tax adviser early, for example on allowances and the timing of the sale
- 05
What is the business worth?
Small and mid-sized businesses are usually valued by capitalised earnings: what counts is the profit the business can generate over time. The starting point is the adjusted profit of recent years. An owner's salary is deducted, meaning what a hired managing director would cost. The rest is converted into a value with a rate that reflects the risk.
For service firms, recurring revenue counts most, such as management or maintenance contracts. The more clients depend on the owner, the higher the risk. That is why part of the price is often agreed as an earn-out.
According to KfW's 2025 succession monitor, expected sale prices in the Mittelstand have risen by around 34 per cent since 2019. According to the DIHK's 2025 report, 36 per cent of retiring owners expect too high a price. An independent valuation early on protects both sides.
- 06
Transferring clients and know-how
The handover is best started before the sale is settled. These steps make the firm less dependent on one person:
- Build second contacts for the most important clients
- Write down processes, quotes and pricing
- Framework agreements instead of verbal arrangements
- Agree a transition period in which the owner personally introduces clients
- 07
Price and earn-out
Because it is uncertain how many clients will stay after the change, part of the price for a service firm is often tied to future results. This is called an earn-out. Both sides share the risk.
Clear rules matter: which figure counts, over what period and who decides during that time. Have the agreement checked by a tax adviser and lawyers.
- 08
Financing
KfW's ERP loan for start-ups and succession (077) finances up to 500,000 euros and at most 35 per cent of eligible costs. You apply through your own bank. If collateral is missing, the guarantee banks of the German states can back loans.
Service firms rarely have machines or buildings that banks accept as collateral. Guarantees and a vendor loan are therefore especially common in the financing.
A vendor loan often completes the financing: the previous owner defers part of the price. According to KfW's 2025 succession monitor, expected sale prices in the Mittelstand have risen by around 34 per cent since 2019. A realistic valuation at the start saves both sides a lot of time.
KfW 077 (in German) · KfW succession monitor 2025, PDF (in German)
Further reading
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Frequently asked questions
Can you take over a service firm that depends heavily on its owner?
Yes, if the handover is well prepared. A shared transition period, second contacts and an earn-out make the change safer for clients and buyers.
What is an earn-out?
Part of the price is paid later and depends on how sales or profit develop after the takeover.
How many service firms are looking for a successor?
There is no exact figure. But according to the DIHK's 2025 report, the chambers see about two business service firms for every person who wants to take one over.
Do client contracts transfer to me automatically?
If you buy shares, the company remains the contracting party. If you buy individual assets, clients usually have to agree. Also check change-of-control clauses.
Where can I find property management, IT and consultancy firms to buy?
On the nexxt-change platform, through chamber of commerce succession advice, tax advisers, banks and personal contacts. Many businesses are never advertised publicly.
How do I sell my property management, IT or consultancy firm?
Start early: put the figures in order, make the business less dependent on you, have it valued and then look for successors discreetly. Your tax adviser belongs in it from the start.
How is the price determined?
Usually by capitalised earnings: starting from the adjusted profit of recent years, minus an owner's salary, converted with a rate that reflects the risk. The price finally paid is a matter of negotiation.