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CIBC Poll: Barely half of Canadian business owners have a transition plan

For those with a strategy, the vast majority rely on a "cocktail napkin" plan, putting their retirement at risk

TORONTO, March 27, 2015 /CNW/ -    A new CIBC (TSX: CM) (NYSE: CM) poll finds that just over half (57 per cent) of Canadian business owners who are within 10 years of retirement have business transition plans. But the vast majority of them admit their plans are informal, despite the fact that many of them are counting on selling their business and living off the proceeds to fund their retirement.

Key findings of the poll:

  • 57 per cent say they have a plan to transition their business -- however, within this group:
    • the vast majority (80 per cent) acknowledge their plans are informal
    • only 14 per cent created their plan in consultation with advisors, such as an accountant, lawyer or banker
    • another 6 per cent prepared a formal plan on their own
  • As many as 40 per cent of business owners have not identified a successor
  • Only 28 per cent have fully communicated their transition plans to stakeholders and just 14 per cent have fully prepared their successor

"Too many business owners are taking a false sense of security from having a transition plan that is informal, which means they are taking chances with their business and their retirement income," says Shelley Swanlund, head of Small Business, CIBC. "For many owners the value of their business is a key part of their retirement fund, we have heard stories from some business owners that they rely on a few ideas on a cocktail napkin."

Owners banking on selling their business to fund retirement

While many business owners have informal transition plans, they are placing a high importance on a potential transaction to fund their futures. When asked to assess their retirement income sources, proceeds from the sale of their business ranked number one at 28 per cent, followed by RRSPs, at 25 per cent.

"When you consider how important a successful transition is to your overall retirement planning, it speaks to the urgency for business owners nearing retirement to create a plan with the help of advisors that will allow them to maximize the value they receive for their business," says Ms. Swanlund.

"As you build a formal transition plan, you will also need to understand the financial situation of any potential new owners," she adds. "As a business owner looking to pass on or sell your business to fund your retirement, you need to ensure the buyer has the financing in place for a smooth transfer."


Percentage of Canadian business owners who have a transition plan for their business:


Yes 57%
Yes, but it is somewhat informal    45%
Yes, I have a formal detailed plan I created with my advisors 8%
Yes, I have a formal detailed plan I created on my own 3%
No 43%
No, but I plan to create one    33%
No, and I don't plan to create one 10%


Percentage of Canadian business owners who have adequately prepared their successor or people to whom they are transitioning their business:


Yes, fully    14%
Yes, somewhat 33%
No, not at all 13%
I haven't identified a successor    40%


Percentage of Canadian business owners who feel they have adequately communicated to their stakeholders about their plans for their business:


Yes, fully    28%
Yes, somewhat 36%
No, not at all 15%
My transition timeframe is too far away 22%


From January 26th to 29th 2015, an online survey was conducted among 803 randomly selected Canadian business owners who are Angus Reid Forum panelists. The margin of error—which measures sampling variability—is +/- 3.46%, 19 times out of 20. The results have been statistically weighted according to education, age, gender and region (and in Quebec language) Census data to ensure a sample representative of the entire adult population of Canada. Discrepancies in or between totals are due to rounding.

CIBC Small Business Services

For more than 140 years, CIBC has been providing small business owners with the advice, services, and support they need to thrive and grow. CIBC recognizes that the business and personal finances of small business owners are often intertwined, which can present both opportunities and challenges. We believe that the best advice comes from someone who understands your needs as a business owner and as an individual.

CIBC provide small business owners with the services of a dedicated CIBC Small Business Advisor, who acts as a single point of contact for all small business owner needs. This experienced professional is committed to understanding the business and the industry in which small business owners operate, as well as their personal financial goals. CIBC business advisors work with small business owners to find integrated solutions to help them achieve their vision for their business and their life.

About CIBC

CIBC is a leading Canadian-based global financial institution with 11 million personal banking and business clients. Through our three major business units - Retail and Business Banking, Wealth Management and Wholesale Banking - CIBC offers a full range of products and services through its comprehensive electronic banking network, branches and offices across Canada with offices in the United States and around the world. You can find other news releases and information about CIBC on our corporate website at


For further information:

Caroline Van Hasselt, Director, External Communications and Media Relations, 416-784-6699,