| Community Futures
Sagehill
Sagehill CF Promotes Business Succession Planning
A recent survey by the Canadian Federation of
Independent Business into business succession planning by small
business owners has uncovered some disturbing numbers. The survey
– which covered both family-owned and non-family-owned businesses
– found that only a third of businesses have a succession
plan. Even worse, the majority of those are informal.
These numbers fly in the face of the fact that
41 per cent of owners of small and medium size businesses want
to leave within the next five years and an additional 32 per cent
intend to leave the business in the next decade.
Other worrisome information emerged from the
survey. More than a third of those surveyed, 37 per cent, indicated
they planned to sell the business to non-family members.
Only a quarter said they would sell to
a family member. All of this prompts the question: Who is going
to be minding the store ten years from now?
"We need to pay attention to these stats,
given the large presence of family businesses in our local economy,"
says Diane Olchowski, the CEO for the Sagehill Community Futures
Development Corporation CFDC). "Small businesses account
for one-quarter of all employment in our province, and 42 per
cent of all Saskatchewan businesses are located in rural areas.
On average, each one has six employees."
Olchowski notes that Sagehill CFDC is ready
to help business owners through the transition process. While
there may be many barriers, she adds, almost half of business
owners transitioning their business encounter financing problems.
Finding a suitable buyer comes a close second. The third major
obstacle is dependence on the former owner's active involvement
during and immediately after the change in ownership.
"Even if the number of business owners
planning to exit their businesses in the next decade is less than
73 per cent, it's still likely incredibly high," Olchowski
observes. "We've developed a Business Succession Guide to
help owners address the issues and prepare a plan. Sagehill will
also be holding an event (time/place?) on Business Succession
to let people know that help is available."
Do you have a question about business succession,
or any other aspect of business? Call Sagehill CFDC at 369-2610
or toll-free 1-888-732-8999.
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