There is a genre of Canadian business writing that has run essentially unchanged for a decade: a large number of owners intend to retire, very few have a succession plan, therefore owners should make a succession plan. Every element of that is factually correct. The conclusion is also close to a non-sequitur, because when the same surveys ask owners what is actually stopping them, the answer they give most often is not something a plan addresses.
Key Takeaway
CFIB research finds 76% of Canadian small business owners intend to exit within a decade, representing over $2 trillion in business assets, while only 9% have a formal succession plan. But the single most common obstacle owners identify is finding a suitable buyer or successor, cited by 54%, ahead of difficulty valuing the business at 43% and excessive dependence on the owner for daily operations at 39%. That first obstacle is a demand-side problem, and CFIB's more recent work on stalled entrepreneurship reports that business exits have outpaced business starts. The implication is uncomfortable and largely absent from succession coverage: the seller pool is growing while the buyer pool is not, which means competent preparation does not guarantee a sale, it determines who transacts when a buyer does appear. Preparation therefore matters more in a buyer-scarce market than in a liquid one, not less, but for a different reason than usually given.
The Inversion At The Heart Of The Coverage
Consider the two most-cited statistics in this field side by side. Only 9% of owners have a formal business succession plan[1]. And for half of small business owners, at 54%, the most common obstacle to succession planning is finding a suitable buyer or a successor[1].
The standard framing treats the first as the problem and planning as the solution. But the second statistic is owners telling researchers, in their own words, that the binding constraint is on the other side of the transaction. An owner without a buyer is not helped by a better-documented intention to sell. That is not an argument against planning, which this article ultimately endorses for reasons set out below, but it is an argument that the conventional framing misidentifies what is scarce.
The distinction matters because the two diagnoses imply different behaviour. If the problem is preparation, the answer is a project with a completion date. If the problem is buyer availability, the answer is optionality: being ready across a window rather than ready on a date, and holding more than one exit route open. Those are genuinely different strategies, and most owners are being sold the first.
The Headline Numbers
Establishing the scale first, with a note on vintage that matters.
CFIB reports that more than three-quarters of small business owners, 76%, plan to exit their businesses within the next ten years, with more than $2 trillion in business assets potentially in play over the decade[2]. Retirement is the top reason cited at 75%, while 22% report burnout and 21% want to step back from their responsibilities as owners[1].
These figures have been widely re-cited across 2025 and 2026, including by CIBC Thought Leadership and the Globe and Mail, which frame the transfer as a pivotal moment for the nation's economic resilience, innovation and growth[3][4]. Readers should note, however, that the underlying CFIB survey release dates to early 2023[1], and that comparable findings appeared in a CFIB survey as far back as 2018, which showed almost 75% of owners planning to exit within ten years and fewer than 10% having developed a succession plan[5]. The consistency across nearly a decade is itself informative: this is a persistent structural condition rather than a developing news event, and the "next ten years" has been rolling forward for some time.
The Obstacle Owners Actually Name
The obstacle data is the most useful and least discussed part of the CFIB work.
For 54% of small business owners, the biggest challenge to succession planning is finding a qualified buyer or successor. Just over two-fifths, 43%, find it difficult to gauge the worth of their company, and 39% feel they are overly dependent on the business for day-to-day operations[6].
Three obstacles, and they are not the same kind of thing. Valuation difficulty is an information problem, solvable by engaging a valuator. Owner dependence is an operational problem, solvable over years by the process documentation and relationship transfer work examined elsewhere in this publication. Both are within the owner's control.
Buyer scarcity is neither. An individual owner cannot create a buyer. They can make themselves more attractive to whatever buyers exist, which is a competitive strategy rather than a solution, and the distinction becomes important when 76% of owners are pursuing it simultaneously.
Exits Are Outpacing Starts
The most consequential recent data point, and the one that turns a static observation into a trend.
Reporting on CFIB's work in April 2026 notes that CFIB's first report on stalled entrepreneurship highlighted that business exits have outpaced business starts[7]. The same report frames the organization's broader concern in terms that connect the two ends: reinvigorating entrepreneurship is not only about supporting today's small businesses, it is also about ensuring Canada remains a country where individuals are willing and able to start, grow and pass on businesses[7].
That sentence is doing something important. It identifies business formation and business succession as a single system rather than two files. The buyer of a Canadian small business is very often an individual entrepreneur, sometimes an employee, sometimes a family member, sometimes a first-time acquirer. If entrepreneurship formation is stalling, the population from which those buyers are drawn is shrinking at precisely the moment the seller population peaks.
This is the demand-side mechanism that the preparation-focused framing does not capture. A market can be simultaneously full of well-prepared sellers and short of buyers, and in that market preparation redistributes outcomes among sellers rather than creating transactions.
The Arithmetic Nobody Runs
It is worth being explicit about what a concentrated exit wave implies, while being equally explicit that this is inference rather than a measured finding.
If roughly three-quarters of owners intend to exit within a common ten-year window, then the annual volume of businesses seeking transfer is elevated for a sustained period rather than smoothed across a normal distribution of retirements. Demand for those businesses comes from strategic acquirers, private equity, employees and management, family members, and individual entrepreneurs. Only some of those categories scale with supply. A strategic acquirer's appetite is limited by integration capacity, not by the number of available targets. Private equity focuses above a size threshold that excludes most Canadian small businesses. And individual entrepreneur formation, per the finding above, is not keeping pace with exits.
The predictable consequences of a supply-heavy market are longer time to transaction, more failed processes, downward pressure on price, and an increased share of transfers occurring through routes other than sale to an unrelated buyer, including closure. CFIB has warned in comparable terms, noting that not having a formalized succession plan could result in lost jobs, bankruptcies or loss of stability for the business[1].
We flag clearly that we have not located research quantifying this imbalance, and an owner should treat the direction as well-supported and the magnitude as unknown. The reason to state the mechanism anyway is that it changes what an individual owner should optimize for, which is the subject of the final sections.
Who Owners Plan To Sell To
Exit route intentions sharpen the picture considerably. When it comes to how owners intend to exit, the most common approach is to sell to an unrelated buyer, at 49%[2].
Roughly half of exiting owners are therefore planning to use the route most exposed to buyer scarcity. Selling to a family member depends on family circumstances rather than market conditions. Selling to employees or management depends on the team's capacity and financing, which is precisely what the Employee Ownership Trust regime examined elsewhere in this publication was designed to address, and which the CFIB itself has identified as a policy priority. Selling to an unrelated third party depends entirely on a buyer existing, being financeable, and choosing your business over the alternatives.
For an owner reading this, the practical question is whether their assumed exit route is the one most subject to a constraint they do not control, and whether a second route has been genuinely evaluated rather than dismissed. The EOT path, with its permanent $10 million capital gains exemption, is a materially more serious option in a buyer-scarce market than it appears in a liquid one, precisely because the buyer, an employee trust, is constructed rather than found.
The Other Two Obstacles Are Self-Inflicted
Having argued that the largest obstacle is outside owners' control, intellectual honesty requires noting that the second and third are squarely inside it.
That 43% find it difficult to gauge the worth of their company[6] is a solvable information deficit. A valuation is a purchasable service, and while a formal valuation is not always necessary years ahead of a transaction, an owner who cannot approximate their business's worth cannot evaluate an offer, cannot plan personally around expected proceeds, and cannot tell whether preparation is worth its cost.
That 39% feel overly dependent on the business for day-to-day operations[6] is the owner-dependence problem examined at length elsewhere in this publication, and it is both the most damaging to price and the slowest to remediate.
The uncomfortable reading of these three obstacles together is that a substantial share of owners face all of them at once: no identified buyer, no clear sense of value, and a business that does not run without them. In a buyer-scarce market, a business with the latter two problems is exactly the one a scarce buyer skips.
What Owners Say They Actually Want
The stated priorities complicate the picture in a way worth taking seriously, because they suggest price is not the objective function most advisory content assumes.
The most important factor for a strong majority of owners looking to sell, 90%, is ensuring their current employees are protected. Getting the highest possible price matters to 84%, and selecting the right buyer who will carry forward their way of doing business also matters to 84%[1].
Employee protection outranking price is a striking result and it should reframe the advice. An owner whose top priority is their staff has a materially different decision problem than one maximizing proceeds: they may rationally accept a lower price from a buyer who will retain the team, and they should be evaluating buyers on criteria that a broker optimizing for price will not surface.
It also strengthens the case for the employee ownership route considerably. A transfer to an employee trust addresses the 90% priority directly and by construction rather than by promise, and does so through a mechanism that does not require finding an external buyer at all. For an owner whose stated priorities are employee protection and continuity of approach, the fact that CFIB's respondents rank those above maximum price suggests that route is underweighted relative to how well it matches what owners say they want.
The 9% Figure, Handled Carefully
Different sources report the planning deficit differently, and the discrepancy is worth surfacing rather than smoothing.
CFIB reports that only one in ten business owners, 9%, have a formal business succession plan in place[1]. A 2025 MNP report is described as confirming that nearly two-thirds of Canadian business owners have considered their exit objectives but have not formalized a plan[8]. Reporting on CFIB's 2026 work states that nearly half of business owners have no succession plan[7]. And the 2018 CFIB survey found less than 10% had developed a succession plan while 51% said they did not have any plan at all[5].
These are not contradictions; they measure different things. "No plan at all" and "no formal plan" are distinct categories, and the gap between them, roughly 9% with a formal plan versus around half with nothing at all, implies a large middle group with informal intentions. That middle group is arguably the most interesting and least served: owners who have thought about it, have a rough idea, and have documented nothing. They will not be reached by messaging that assumes they have not considered the question.
On the advisory relationships behind those plans: 43% of owners use accountants to develop a succession plan, 24% work with lawyers, and about 39% develop a plan on their own[6]. That accountants are the most-used professional in this process is worth noting plainly, including by us, as a statement about where owners actually turn rather than where advisory marketing suggests they should.
The Timing Distortion Still Working Through
One historical factor continues to shape the current wave and is rarely mentioned.
CFIB found that nearly four in ten owners changed their business exit dates as a result of the pandemic: 17% accelerated their timeline, often as a result of the stress they were under, while 22% delayed it by at least one year, often because they had incurred too much debt or the value of their business had gone down too much during the pandemic[1].
Two implications. The delayed cohort, larger than the accelerated one, pushed supply forward into the period we are now in, which compounds rather than relieves the concentration described above. And the reason for delay, debt incurred and value impaired, means a portion of the businesses now coming to market carry balance sheets weakened by that period, which affects both their attractiveness and their owners' need to transact.
An owner who delayed for those reasons should be candid with themselves about whether the underlying condition has actually been remediated, because arriving at a buyer-scarce market with a pandemic-era debt load is a materially worse position than arriving with a clean one.
What CFIB Is Asking Government For
Because part of the constraint is structural, the policy dimension is worth knowing, both for context and because some of it may materialize.
CFIB has called on government to honour the spirit of Bill C-208 in any amendments it proposes, so that family members inheriting small enterprises are treated similarly to those acquiring them through a third party, and to simplify the Lifetime Capital Gains Exemption and increase it[2][6]. In a more recent letter to the finance minister, CFIB specified measures including an expansion of existing rollover provisions when selling a business and the introduction of a lower capital gains inclusion rate on a second tranche of gains above the LCGE[7].
For reference, the LCGE on the sale of small business corporation shares and farming and fishing property on or after June 25, 2024 is $1.25 million, with indexation resuming for 2026[7].
Note what these asks have in common: they reduce the tax cost of transferring, which improves seller economics. They do not create buyers. The one significant recent Canadian measure that does address the buyer-formation problem directly is the Employee Ownership Trust regime, which manufactures a buyer out of the existing workforce, and which as noted elsewhere in this publication became permanent in June 2026.
The Strategic Implication For An Individual Owner
Here is the argument this article exists to make, and it is not the one the data superficially suggests.
If buyers are scarce relative to sellers, an owner might conclude that preparation is futile, since preparation cannot create demand. That conclusion is wrong, and the reason is competitive rather than absolute. In a market with more sellers than buyers, a buyer chooses among available businesses. Preparation does not determine whether a transaction market exists; it determines whether you are the business selected when a buyer with financing appears.
This inverts the usual urgency argument in a useful way. Preparation is typically sold on the basis that it raises price. In a buyer-scarce market its more important function is raising the probability of transacting at all, and the sellers who lose are not those who got a lower multiple but those who never found a counterparty and eventually wound down.
It also changes what readiness means. In a liquid market, an owner can decide to sell and then prepare. In a buyer-scarce market, opportunities arrive unpredictably, and the relevant state is being continuously ready across a multi-year window rather than ready on a chosen date. That argues for maintaining clean reviewed financials, current documentation and an assembled data room as an ongoing condition rather than a pre-sale project, which is a meaningfully different operating posture.
A Worked Case: Ready When It Arrived
Two Canadian owners in the same trade sector, similar revenue, both intending to retire within roughly the same window. The comparison is constructed to illustrate the dynamic rather than reported from specific engagements.
Owner A planned to begin preparing once they had decided on a date. When a regional consolidator approached the sector and acquired three businesses over eighteen months, Owner A was contacted, could not produce reviewed financials or documented processes within the consolidator's timeline, and was passed over in favour of two competitors who could. By the time the business was prepared, the consolidator had completed its regional programme and moved on. No comparable buyer emerged in the following three years.
Owner B maintained reviewed financials and a current data room from roughly five years out, not because a sale was imminent but as a standing condition. When the same consolidator approached, Owner B responded within the window and transacted.
The multiple Owner B achieved was probably not remarkable. What mattered was that Owner B transacted and Owner A did not, and the difference was readiness at an unpredictable moment rather than any negotiating skill or value-driver improvement. In a market where buyers arrive in waves and the seller pool is deep, that is the variable that dominates, and it is the one least emphasized in conventional succession advice.
What To Do About A Demand Problem
Treat readiness as a standing state, not a project. Reviewed financials, current documentation and an assembled data room maintained continuously, because the buyer's timeline will not accommodate your preparation timeline.
Hold at least two exit routes open. Roughly half of owners plan to sell to an unrelated buyer, the route most exposed to buyer scarcity. Evaluate the employee ownership and management buyout paths seriously rather than as fallbacks, particularly given that the buyer is constructed rather than found.
Fix the obstacles you actually control. Valuation uncertainty and owner dependence are cited by 43% and 39% of owners respectively and are both addressable. In a buyer-scarce market these are exactly what a selective buyer screens on.
Be honest about your real objective function. If employee protection genuinely outranks price for you, as it does for 90% of surveyed owners, say so early and evaluate buyers accordingly, because a process optimized for price will not surface what you actually want.
Do not wait for a policy fix. The measures under discussion improve seller tax economics rather than creating buyers, so they change your after-tax proceeds if you transact and do nothing about whether you transact.
Consider the timing of your own cohort. If you are in the delayed-by-COVID group, you are arriving alongside a compressed cohort with a balance sheet that may still reflect that period. Remediating the balance sheet may matter more than any other single preparation step.
The Limits Of This Analysis
Several caveats matter. The core CFIB statistics, the 76%, the $2 trillion, the 54% buyer obstacle and the 9% planning figure, derive from a survey release dating to early 2023 that has been widely re-cited since, and readers should treat them as a persistent structural picture rather than current-year measurements; comparable findings from 2018 suggest the condition is long-standing. The observation that exits have outpaced starts comes from secondary reporting on a CFIB report we did not obtain directly. The supply-demand imbalance argument in this article, including its predicted consequences, is our own inference from the cited data rather than a measured finding, and we have not located research quantifying the imbalance. Reported planning-deficit figures differ across sources because they measure different categories, as discussed. The worked case is constructed. Finally, this is general analysis rather than succession or tax advice; exit route selection has significant tax consequences that should be evaluated with qualified Canadian professionals.
Frequently Asked Questions
How many Canadian owners are planning to exit?
What is the biggest obstacle owners report?
Is the buyer pool actually shrinking?
If buyers are scarce, is preparation pointless?
What do owners say matters most in a sale?
Will tax changes fix this?
References
- Canadian Federation of Independent Business. (2023, January). Over $2 Trillion In Business Assets Are At Stake As Majority Of Small Business Owners Plan To Exit Their Business Over The Next Decade, including the 54% buyer obstacle, exit reasons, stated priorities and pandemic timeline changes. cfib-fcei.ca/en/media/over-2-trillion-in-business-assets-are-at-stake
- Investment Executive. Canada Faces Mass Exodus Of Small Business Owners, on the 76% figure, the 49% unrelated-buyer intention and CFIB's Bill C-208 and LCGE asks. investmentexecutive.com/news/markets/canada-faces-mass-exodus-of-small-business-owners
- CIBC Thought Leadership. The Economic Case For Getting Business Succession Right. thoughtleadership.cibc.com/article/the-economic-case-for-getting-business-succession-right
- The Globe and Mail. (2025, February 21). The Economic Case For Getting Business Succession Right. theglobeandmail.com/business/adv/article-the-economic-case-for-getting-business-succession-right
- TD. Creating A Succession Plan, citing the 2018 CFIB survey showing almost 75% planning to exit within ten years, less than 10% with a developed succession plan and 51% with no plan at all. td.com/ca/en/business-banking/small-business/succession-planning/creating-a-succession-plan
- Wealth Professional. (2023, January 11). Trillions In Play As Small Business Owners Seek To Exit In The Next Decade, on the three obstacles and advisor usage. wealthprofessional.ca/news/industry-news/trillions-in-play
- Investment Executive. (2026, April). CFIB Urges Feds To Support Succession Planning For Small Biz, on stalled entrepreneurship, exits outpacing starts, the letter to the finance minister and the current LCGE amount. investmentexecutive.com/news/cfib-urges-feds-to-support-succession-planning-for-small-biz
- Globe Newswire / The Globe and Mail. (2026, January 30). New Book Offers Canadian Business Owners Step-By-Step Roadmap To Maximize Value And Secure Their Legacy, citing CFIB figures and a 2025 MNP LLP report. theglobeandmail.com/investing/markets/markets-news/GlobeNewswire/36476741
This article discusses survey data and industry reporting and is provided for general informational purposes. It is not succession, tax or transaction advice. Core statistics derive from a survey release dating to early 2023 and are treated as structural rather than current-year measurements. Exit route selection carries significant tax consequences; consult qualified Canadian professionals.