More than 60% of small business owners to exit in next decade, putting $2 trillion at risk

We independently select everything we recommend. Buying through us may earn us a commission, which supports our work.

Over 60 per cent of small business owners plan to leave their business in the next decade, leaving over $2 trillion in business assets at risk, said the Canadian Federation of Independent Business (CFIB) Thursday.

Only six per cent of those businesses have a formal succession plan in place, according to the CFIB survey. The majority cite retirement as the primary reason for exiting, but burnout or stress and high operating costs are also pushing business owners out the door.

Thirteen per cent of owners expect to close their doors altogether.

CFIB said these latest survey results come after business exits have outpaced new entries in Canada since early 2024.

“Canada is in an entrepreneurial drought,” said CFIB’s executive vice-president of advocacy, Corinne Pohlmann.

“With a wave of owners preparing to exit, we can’t afford to lose viable businesses because of the difficulty in navigating ownership transitions or finding someone to take over the business. That’s a huge blow to the economy, and it puts jobs and local services at risk.”

Nearly half the owners in the survey said finding buyer or suitable successor is the biggest obstacle. For the rest, the common barriers are being too busy to plan and struggling to determine the value of the business.

For those with succession plans, 54 per cent plan to sell to an unrelated buyer, while 28 per cent plan to sell to employees. Furthermore, 21 per cent of owners plan to sell to a family member, while 19 per cent plan to transfer the business to a family member.

CFIB’s senior director of research, Marvin Cruz, said most business owners count on selling their business to fund their retirement. If they can’t find a buyer, they may have to delay retiring or close the business altogether.

Seven in 10 owners surveyed say keeping their business Canadian-owned is important, even for the 68 per cent who plan to sell to outside the family. These owners also put a high priority on protecting their employees and making sure the business keeps supporting its community, said CFIB.