Should I sell my business now or keep holding it?

This page does not recommend selling or holding. That depends on your goals, your finances and your business. What published guidance does offer is a way to frame the choice. BDC says selling is often not an easy decision for an owner, and that planning well in advance makes a big difference whatever your goal is.

Start with your reason

BDC lists common reasons for selling, including retirement, moving on to another project, medical issues, financial difficulties and market conditions. The goals it lists include maximizing the price, keeping the business going so long-time employees keep their jobs, or staying involved after the sale. Being clear on your goals, BDC says, helps you structure and prepare for a deal that meets your needs. Write yours down, then ask whether holding or selling serves them better.

Check what a sale would involve

BDC says a lot of people underestimate how long it takes to prepare a business for sale, especially if the company has issues to fix. BDC says buyers will ask to see historic and interim financial statements, projections and tax returns, so ask your accountant whether yours are ready. Then list what you would need to change, and how long that would take.

Get a realistic view of value

BDC notes that owners sometimes have a mistaken perception of their company’s value, partly because of an emotional connection to it. It recommends engaging a Chartered Business Valuator (CBV) for a realistic market-perceived price. If the number falls below your expectations, BDC calls that an opportunity to look at ways to improve the business before selling.

Avoid a forced timetable

BDC says it sees entrepreneurs near retirement who have not thought about selling, then sell at a time that is not ideal, for example because of health issues, and do not get the best outcome compared with having planned. CFIB says maximizing succession planning involves the safe and orderly transfer of assets and is critical for the wellbeing of the owner, the business itself and Canada’s economy. If you decide to hold, ask your advisors what plan you would need if health or another event forced a transfer earlier than you chose. Read what your options for exiting are before deciding.