Central Minimum Wage Council (Deliberative Council on the Future of the Guideline System)

News Highlights

The Central Minimum Wage Council held a deliberative council on the future of the guideline system. This deliberation will allow medical institution managers, successors, and stakeholders to reconfirm the value of third-party succession as an option for successor issues, the importance of early preparation from around age 60, and the significance of utilizing specialized advisors for the medical industry.

M&A Medical Editorial Department’s Perspective

The discussions at the Central Minimum Wage Council regarding the guideline system are not directly focused on M&A or business succession for medical institutions. However, the perspectives of “structural changes in society as a whole” and “pursuit of sustainability” that underlie these discussions are extremely insightful for medical institution management. In particular, the pressure of rising labor costs can directly impact the revenue structure of medical institutions and become a factor in squeezing management. Under these circumstances, medical institutions facing the structural issue of lack of successors are compelled to reconsider third-party succession, namely business transfer through M&A or share transfer, as a more realistic and strategic option, rather than just closure or going out of business. Early consideration from around age 60 and the utilization of specialized advisors focusing on medical M&A are not merely “preparation” but essential elements of management decisions for maintaining a sustainable medical care system.

Points Raised by This News

• The pressure for minimum wage increases may further squeeze the management of medical institutions with tight revenue structures.
• For medical institutions lacking successors, third-party succession through M&A is re-emerging as a sustainable option other than closure or going out of business.
• Formulating a business succession plan from around age 60 should be positioned as part of management strategy, taking into account the trends in minimum wage guideline revisions.
• The importance of M&A as a redistribution of management resources (people, assets, capital) to maintain the profitability and business continuity of medical institutions is increasing.

Practical Questions Arising from This News

• If the minimum wage increases, how much will the salary burden specifically increase for a clinic like ours?
• When considering third-party succession, how can successor candidates realistically be found?
• To what extent do discussions on minimum wage guidelines influence the timing of consulting with an M&A intermediary?

If You Feel “Should I Consult Too?”

If the rise in the minimum wage may squeeze your management and you are facing the issue of a lack of successors, we recommend consulting with an expert early on regarding the future sustainability of your institution. As an alternative to closure or going out of business, third-party succession (M&A) can be a realistic path to connect your institution’s philosophy, employees, and patients. Let’s start by sharing your institution’s current situation and future vision to explore concrete options and their feasibility.

M&A Medical (CentralMedience Inc.) supports business succession for medical corporations, hospitals, and clinics on a full success fee basis as an M&A support institution certified by the Small and Medium Enterprise Agency. Consultations are accepted with strict confidentiality. Free consultation here