A new study from the Business Development Bank of Canada landed this week. The numbers should get every franchise owner’s attention.
Sixty-one percent of Canadian SMEs are now led by owners aged 50 or older. Nearly one in five plan to exit within the next five years. Add it up and you’re looking at a $300 billion wave of business acquisitions about to reshape the Canadian economy.
For franchisees, this isn’t abstract. It’s the multi-unit operator down the street who’s been talking about slowing down. It’s your franchisor fielding more resale inquiries than new build applications. And maybe, if you’re being honest with yourself, it’s you.
The makeshift exit isn’t a plan
Few franchise owners I talk to have thought seriously about their exit. Almost none have actually planned for one.
They assume the franchisor will find a buyer. They figure the kids might take over. They tell themselves they’ll deal with it “in a couple years.” But a couple years passes quickly. And suddenly you’re negotiating from exhaustion, not strength.
The BDC study found something worth noting: businesses acquired by prepared buyers outperform significantly. Acquirers earn four times the profits of non-acquirers within five years. That’s not luck. That’s what happens when both sides of a transaction know what they’re doing.
What a smooth handoff actually looks like
We recently worked with a client acquiring a franchise from an owner ready to retire. The seller isn’t disappearing. He’s staying on for six months to manage day-to-day operations while the new owner gets up to speed.
That’s what good looks like. The buyer gets institutional knowledge and customer relationships intact. The seller gets a clean exit without watching their legacy unravel. The franchisor keeps a performing location. Everyone wins.
But here’s the thing. It only worked because the seller started planning two years ago. He knew his numbers. He had clean financials. He understood what his franchise was actually worth, not what he hoped it was worth.
The window is open. It won’t stay open forever.
Here’s the reality of 2026: economic growth is modest, costs keep climbing, and trade uncertainty makes everyone cautious. The CFIB’s latest data shows small business confidence recovering but still fragile heading into the year.
That sounds like bad news for sellers. It’s actually the opposite.
Buyers are hungry. With so many owners approaching retirement, serious acquirers are actively looking for well-run franchises with strong unit economics. If your books are clean and your operations are tight, you have leverage.
But if thousands of franchises hit the market at once, all from owners who waited too long? Buyers will have options. Valuations compress. The sellers who prepared get premium offers. The rest take what they can get.
You don’t need to sell tomorrow. You need to be ready.
Thinking about your exit doesn’t mean listing your franchise next week. It means knowing the answer to a few basic questions.
What is your business actually worth today? Not the number in your head. The number a buyer would pay based on your financials.
What would a transition look like? Could you stay on for a few months to help? Would you want to?
Is your franchise in a condition you’d be proud to hand over? If a buyer did due diligence tomorrow, what would they find?
These aren’t questions for “someday.” The owners who answer them now will have options in two years. The ones who don’t will be reacting instead of deciding.
My take?
The succession wave is coming whether any of us are ready or not. $300 billion in business value is about to change hands across Canada, and franchises will be a significant part of that.
You’ve spent years building something real. The exit is the final chapter of that story. It should be one you write yourself.
