The Trillion $ Challenge

For A Business Dear To You

 

 

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 …

[1] In a study conducted by BMO 63% of Canadians over the age of 45 picked the phrase ‘the next stage of my life’ to describe potential retirement. Vancouver Sun, December 8, 2005.

[2] The Trillion Dollar Trap, Rick Spence, Profit Magazine, September, 2005.