Business continuity outranks financial return as the top priority for owners planning to sell or transfer their companies, highlighting the importance of legacy, employees, and long-term success.
Western Canada is approaching one of the largest business ownership transitions in recent history.
New research from National Bank reveals that nearly half (47%) of Western Canadian mid-market business owners expect to retire within the next 10 years, while more than two-thirds (68%) plan to sell or transfer their business. Among those planning a sale or transfer, 60% expect it to happen within the next decade.
The findings point to a significant succession wave on the horizon as many business owners prepare to leave the companies they have spent years or decades building. The transition will have implications not only for owners themselves, but also for employment, local economies, and the long-term continuity of businesses across Alberta, British Columbia, Saskatchewan, and Manitoba.
"The results show us that Western Canada is entering a period of significant business transition," said Paul Gill, Senior Vice President & Co-Head, Commercial Banking and Private Banking, Western Canada, National Bank. "Many business owners are approaching retirement at the same time and will need to make decisions about the future ownership of their businesses – businesses that employ people, serve communities and drive the regional economy. The decisions these owners make over the next decade will likely have an impact well beyond their own retirement.”
For many business owners, legacy matters more than maximizing the sale price. The survey found that succession planning is about much more than a financial transaction.
Among Western Canadian business owners planning to sell or transfer their business, the most important priority is ensuring the continuation of the business (44%), which ranked ahead of maximizing financial return from the sale (39%). More than one-third (36%) say finding the right person or people to take over the company is a priority consideration.
The findings underscore the deep connection many owners have to the companies they have built and the people who rely on them. For many, preserving jobs, protecting company culture, and ensuring future success are just as important as achieving a favourable sale price.
A growing transition wave may also be met with a planning gap. While awareness of succession planning is high, many business owners have only consulted, on average, one of the various advisors required to support in selling their business.
Among those planning to sell or transfer their business, 98% say they know the advisors or professionals they would need to support the process. However, while 62% have sought professional advice, most have only engaged a single advisor on average, and more than one-third (36%) have not yet engaged any specific advisors to help guide a sale or transfer.
As retirement timelines accelerate, these findings suggest many business owners may need to move from planning to implementation sooner rather than later.
"One of the biggest risks is not that business owners don't understand the importance of succession planning. It's that they may not realize how much opportunity early planning can create,” said Gill. "The earlier owners begin the planning process, the more options they may have to protect the value of their business, support employees and achieve their personal goals."
Personal priorities are shaping succession decisions
The research also highlights the personal motivations behind many transition plans.
Among owners considering a sale or transfer, spending more time with family (37%) is the leading personal priority, followed by the ability to fully retire (36%) and the opportunity to pursue a new business venture (31%).
Together, the findings suggest that succession planning is increasingly becoming a balance of business, financial and personal objectives, with owners seeking outcomes that protect both their future and the future of the businesses they have built.