Succession planning statistics: 10 facts Canadian business owners need to know in 2026

The latest succession planning statistics for Canada tell a simple story: a large share of owners intend to sell, few are ready, and the rules that decide what they keep have just been settled. We gathered the most current figures available in October 2026, checked each one against its original source, and in several places ran our own numbers. Where a figure is our own calculation, we say so and show the math. Where the best available data is American, we say that too. Reporters and researchers are welcome to quote these figures; please credit Legacy Matters and link to this page.

1. One in five Canadian businesses plans to sell or transfer within 10 years

In its summer 2026 survey, Statistics Canada found that 20.3% of Canadian businesses intend to sell or transfer ownership within the next 10 years. Nearly a third of them (31.3%) expect to do it within two years. The share climbs to 32.0% where the majority owner is 65 or older, to 27.7% in manufacturing, 27.3% in wholesale trade, and 26.5% among businesses with 5 to 19 employees.

Applied to the 1,099,521 employer businesses counted by Innovation, Science and Economic Development Canada, that is roughly 223,000 businesses planning to change hands within a decade, and about 70,000 within two years. That works out to roughly 140 Canadian businesses every working day. In Ontario, where 18.9% plan to sell or transfer, it is about 79,000 businesses over 10 years and 26,600 within two. (These are Legacy Matters estimates. The method is at the end.)

2. Most owners selling soon don’t expect a fair price

Statistics Canada asked owners planning to sell within two years what they expect. Only 34.6% expect to receive a fair market price. Only 24.4% say they have enough time and resources for the transition, and 38.4% plan to use professional advisors. Half (50.1%) expect to find qualified buyers.

Ontario owners are more pessimistic about price, time and advice: 26.5% expect a fair price, 17.4% say they have enough time and resources, and only 25.4% plan to bring in advisors. Put another way, roughly three in four Ontario owners selling soon do not expect to be paid what their business is worth.

A note for researchers: Statistics Canada’s summary article describes these questions as covering everyone planning to sell within 10 years. The official data table says only businesses planning to sell within two years were asked. We follow the table.

3. Without a buyer, about 21,000 businesses would likely scale down or close

When owners planning to sell within two years were asked what happens if no suitable buyer or successor appears, 30.0% said they are very likely to scale down or close. Another 16.2% said they are very likely to sell at a reduced value or on worse terms, and 33.7% would very likely carry on under the current owner (Statistics Canada table).

By our estimate, that 30% is about 21,000 Canadian employer businesses, including roughly 7,000 in Ontario. These are stated likelihoods, not forecasts. But they describe real companies, with real employees and customers, whose future depends on whether a buyer can be found in time.

4. Owners care more about the right buyer than the highest price

Asked what matters most in a sale, 59.1% of owners selling within two years said finding a buyer in Canada is very important. Preserving the company’s culture and values (55.9%), keeping a local presence (55.7%) and protecting employees (51.7%) all ranked high. Getting the highest price was rated very important by only 29.7% (Statistics Canada table).

This is one of the least reported findings in the survey, and it matches what we hear from owners. The good news is that the goals do not compete. A well-prepared business attracts more buyers, and more buyers give an owner the room to choose the right one without giving up price.

Owners want the right buyer more than the highest price. Preparation is how you get both.

5. Fewer than one in four owners exiting soon have a formal plan

Among owners likely to exit within five years, only 24% have a formal succession plan or exit strategy, according to BDC’s September 2025 Business Transition Survey of 684 owners. Across small businesses generally, the Canadian Federation of Independent Business found that just 9% have a formal plan and 46% have none at all. CFIB’s survey of 2,479 owners also named the biggest obstacles: finding a buyer or successor (54%), valuing the business (43%) and the business relying too heavily on the owner (39%).

Mid-sized companies are not far ahead. In a National Bank and Angus Reid survey of 504 owners with revenue of $3 million to $100 million, 36% of those planning a sale or transfer had not engaged any advisor. If you are in that group, our case for preparing even if you never sell is a good place to start.

6. Buyers outnumber sellers, and money is cheaper

BDC reports that for every 10 Canadian businesses looking to buy, only seven are looking to sell. Financing has also eased. The Bank of Canada’s policy rate stood at 2.25% as of October 20, 2026, down from a peak of 5.00% that held from July 2023 to June 2024, and the prime rate is 4.45%, down from 7.20%.

More buyers and cheaper money do not guarantee a good price. They reward businesses a buyer can understand quickly and trust. If an approach has already arrived, read what to do before you answer an unsolicited offer.

7. The 2026 tax rules are finally settled

• The lifetime capital gains exemption on qualifying small business shares is $1,275,000 for 2026, indexed to inflation. The increase from about $1 million became law when Bill C-15 received Royal Assent on March 26, 2026. The exemption has grown 59% since 2014, when it was $800,000.
• Only half of a capital gain is taxed. The proposed increase to two-thirds was cancelled in March 2025.
• By our estimate, the exemption is worth up to about $341,000 in tax for one shareholder in Ontario’s top bracket ($1,275,000 x one-half x 53.53%). The alternative minimum tax still counts 30% of an exempt gain, so the real figure depends on your situation.
• The $10 million capital gains exemption for selling to an employee ownership trust became permanent when Bill C-30 received Royal Assent on June 18, 2026. Yet only about five Canadian companies have publicly announced an employee ownership trust.

Whether your shares qualify for the exemption depends on tests that look back 24 months, which is one reason structure matters. We cover it in share sale vs asset sale in Canada. Confirm your own position with your accountant.

8. Earn-outs pay about 21 cents on the dollar (US data)

An earn-out is the part of the price paid later, only if the business hits agreed targets. SRS Acquiom, which tracks private deals in the United States, found earn-outs in 24% of 2025 deals. Across 1,174 deals from 2009 to 2026, about 21 cents of every earn-out dollar was actually paid, excluding life sciences.

Canada has no equivalent public dataset, so we use the US figure with that caveat. The lesson travels well: money promised after closing is worth far less than money paid at closing.

9. Nearly half of broken deals die in due diligence (US data)

Axial, a US deal platform for companies worth $2.5 million to $250 million, studied 75 signed letters of intent that fell apart in 2025. About 47% broke because of what diligence found: 25.3% from general diligence findings and 21.3% from quality of earnings reviews that did not support the seller’s numbers. The quality of earnings share doubled from 10.6% in 2023.

Note what this does and does not say. It is the share of broken deals, not of all deals. Most of these problems are visible years earlier to anyone who looks at the business the way a buyer does.

10. Larger, cleaner businesses sell for more (US data)

In the BizBuySell Q3 2026 report, US businesses that sold for over $1 million averaged 3.73 times cash flow, against 2.30 times for smaller ones: a 62% higher multiple. They also sold for 100.8% of asking price, against 93.6%. Among larger private equity deals, GF Data figures reported by Mercer Capital show about 7.6 times EBITDA for $50 million to $250 million transactions, against about 6.8 times for $10 million to $50 million.

Deals also take time. The IBBA and M&A Source report that US lower middle market deals took 11 to 12 months to close in mid-2026, and that retirement was the leading reason owners sold in every size range. Add the months needed to prepare, and the 1 to 3 year window starts to look short.

Four popular statistics that don’t hold up

Some figures appear in almost every article on this subject. We tried to trace each to its source.

• “Only 20% to 30% of businesses listed for sale ever sell.” We found no study behind it. The most-cited version gives its source only as “reliable data sources”.
• “75% of owners regret selling within a year.” The Exit Planning Institute’s 2023 report attributes it to “PwC research” without a reference, and we could not find the PwC publication.
• “70% of family businesses fail by the second generation.” It traces to a 1987 study of 200 Illinois manufacturers between 1924 and 1984. It measured survival, not failure, and many of those firms were sold.
• “80% to 90% of an owner’s net worth is in the business.” Widely repeated as an assertion, but we found no survey that measured it.

None of this means owners are in good shape. The real numbers above are sobering enough.

Where these succession planning statistics come from

Our estimates multiply the 1,099,521 employer businesses counted by ISED (December 2024) by the shares in Statistics Canada’s summer 2026 survey, then round the result. Figures marked US data come from US sources because no Canadian equivalent is published, and every figure was checked against its source on October 20, 2026.