The conditions for a successful transfer

There are only four of them, but if they are all met, your project has a strong chance of being successful.

1/ Building trust with your employees (and vice versa)

  • Is the relationship between you and your employees conflictual?
  • Does the idea of employees being part of the decision-making process and sharing in the business profits seem strange to you?
  • Do you consider that the employees will never have all the skills and energy to continue the work that you have accomplished?

Then, it is best to forget about transferring your business into a worker cooperative. In fact, transferring your business into a worker cooperative rests on a very basic idea: the best persons to take over from you are, logically, those who have helped you accumulate your assets.

You both know each other very well; over time, trust has developed between you and you believe that they have also contributed to your success. This will never be the case with a third party.

2/ Identifying the man or woman who could succeed you

In a worker cooperative, it does not mean that because the worker-members will become the owners of the business, that it does not need a leader.

Like all businesses, someone has to make the decisions and bear responsibility for them.

However, do not look for someone who resembles you, who would have all the qualities that have made you the entrepreneur that you have become.

All you need is an employee, undoubtedly, one who is already a senior-level manager and has demonstrated to you, as well as the other employees that they possess great listening and teaching skills and a certain authority, for the principles behind the worker cooperative to do the rest.

For the chosen man or woman who will accept to take up the gauntlet, wherever they fall short, the participative management of the worker cooperative and the collective desire to succeed will compensate for this. And do not forget the training (management, finance, cooperative management, etc.) that can be provided, if necessary.

3/ Not being solely satisfied with just a financial operation

Are you only interested in the value of your business? In this case, perhaps transferring the business into a worker cooperative is not fully meant for you. Not because you would not obtain a fair selling price. But, by limiting the transfer to a mere financial transaction, you miss other difficult-to-quantify advantages that will bring you security and satisfaction, which should be taken into account. (See “Why transfer your business to your employees”)

4/ Being prepared to dedicate the time to make the operation a success

  • It takes six months to transfer ownership of a business and convert it into a worker cooperative in four stages (Link to “The four steps in transferring your business”).
  • This time is dedicated to developing all the managerial, legal, financial and human conditions to ensure the success of the converted business.
  • This is about the time that you would need to seek and find a third-party buyer that, perhaps, will offer you the right price, but that you do not know.

It is up to you to compare these two investments in terms of time.

  • Moreover, in the case of transferring the business into a worker cooperative, you can decide, with the new employees managing the business, on a transition period (Link to “Why transfer your business to your employees”; reason § 6) during which you will be able to support the business on the next leg of its adventure.