According to the Business Development Bank of Canada (BDC), 43% of entrepreneurs in BC are planning to leave their business in the next five years, without acquiring another one.
BDC economist Pierre Cleroux says it’s mostly due to an aging population.
“The numbers are really related to the fact that entrepreneurs are getting older, they are getting closer to retirement – so the fact that the numbers are a bit higher in British Columbia is probably the fact entrepreneurs are a bit older.”
The percentage is not the highest in Canada as Alberta and Atlantic Canada business owners are showing greater intentions at 45% and 46% respectively.
“The demography is a bit different in Atlantic Canada – entrepreneurs and the population, in general, are older in Atlantic Canada so that would explain the difference. In the prairies, I think it’s probably related to the economic situation, maybe some people will retire a bit earlier since the economy has been difficult over the last few years because of lower oil prices,” said Cleroux.
He adds it’s very important to keep operating as normal, even if you’re looking to get out.
“So you have to keep Investing because potential buyers are looking for growing, profitable and stable business. You also have to have sound financial reporting because again, potential buyers that’s the first thing they are going to look at.”
However, 10% of BC small business owners plan to exit their business and acquire another one.
Thanks to the province’s strong economy, Cleroux believes a small section of entrepreneurs are looking to expand.
“People who are looking to buy another business are the most dynamic entrepreneurs so they are interpreters who have a business but they’re looking for another opportunity. I think British Columbia had to have very strong economic growth over the last few years so I’m not surprised to see that more entrepreneurs in BC are looking for business opportunity because there’s a lot of opportunities in a growing economy.”
About 60% of Canada’s small and mid-sized business owners are 50 years old and up.
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