Staff turnover

Every business loses some staff — turnover on its own is not a red flag. What matters is the pattern: is it stable and expected for the industry, or is it accelerating, and is it hitting the experienced employees who actually carry the business? A restaurant losing junior line cooks regularly is normal; a service business losing its senior technicians every few months is not.

What high turnover usually signals

• Management or scheduling problems the owner has not been dealing with
• Below-market wages that a buyer will likely need to correct after closing
• A workplace culture issue that will not disappear with new ownership
• Rising training and recruiting costs that are not always broken out as a separate line item

What to check in diligence

Employment standards on notice, severance and continuity of service vary by province, so how a sale is structured can itself affect what a buyer owes departing or continuing staff. Reviewing recent departures, exit reasons where they were recorded, and current wage levels against the local market gives a much clearer read than the turnover number by itself.