The Trillion $ Challenge …
Coming (Very) Soon to a Business Dear To You
The
demographics of the Baby Boom have ruled the economy for the last 50
years. The next ten years will be no different. As of January 1,
2006 the first baby boomer turned 60 years old. Retirement, of some
description, is the ‘next stage of life’.[1]
For
the legions of baby boomer entrepreneurs who own and operate their
own businesses that means selling their company to management or
outsiders. Alternatively, they will transfer management and/or
ownership to the next generation of their family.
Given
the potential number of companies for sale, the impact of this wave
of business transfers will be profound. According to a 2005 survey
by the Canadian Federation of Business (CFIB), 71% of entrepreneurs
intended to sell their businesses over the next five to ten years.
By 2008 this means that those entrepreneurs will be
selling within two to seven years!
With
440,000 companies in Canada who employ between 5 and 199 employees,
that statistic translates into more than 300,000 businesses being
listed for sale. According to the author of the article
The Trillion Dollar Trap
more than $1 trillion will be needed to finance this transition,
pushing Canada’s capital markets to the limit – if not beyond[2].
This wave of business transfers will mean competition for capital,
for buyers, for talent, even for advisors! What will it cost you
and your business if you’re not ready for the challenge? A lower
price for your business? Your competitor being in a stronger
position than you? Your family getting less? Less money for your
retirement … your ‘next stage’?
The
CFIB survey referred to above was conducted
almost
three years ago.
Time marches on.
When the Trillion Dollar Challenge comes to
Your
business …
will
You
be ready?
We can
help you …
