If succession planning for your small business is still something you're putting off, here's a number worth sitting with: $5 trillion. That's the enterprise value McKinsey projects will change hands as Baby Boomer owners exit their businesses between now and 2035, across roughly 6 million companies (McKinsey Institute for Economic Mobility, 2026). More than half of small-business owners today are 55 or older. One in four is 65 or older. This isn't a distant trend. It's already underway, and it's becoming the difference between the two outcomes below.

Now the uncomfortable footnote. Of those 6 million businesses expected to transition, McKinsey estimates only about 1 million will actually sell. The rest are on track to close rather than transfer to a new owner. Annual small-business exits are projected to climb to roughly 665,000 a year by 2035, a 42% increase over 2011 levels, and the historical pattern behind those numbers is stark: most exits end in closure, not a transaction.

That headline statistic covers every kind of small business, including solo operators with no staff and no real transferable business to speak of. If you own a company with employees, the picture looks meaningfully different.

A survey fielded by Gallup, funded by JPMorganChase and the Ewing Marion Kauffman Foundation, found that 74% of employer-business owners (the kind with actual staff, not solo operators) report having some plan to sell or transfer ownership. Among nonemployer owners, that figure drops to 35% (Gallup, 2026). If you've built a real company with a team behind you, you're already ahead of the closure-heavy headlines that dominate coverage of this trend.

Worth flagging plainly: neither of these sources is government data. McKinsey's figures come from interpretive research, not the Census Bureau or BLS, and the Gallup survey is foundation-funded, not a federal statistic. No source currently ties owner age directly to whether a business sells or closes at the national level. Treat these as the best available evidence, not certainty.

The gap between employer and nonemployer owners makes sense once you think about what a "business" actually is in each case. A solo operator's business is often inseparable from the person running it, there's no team, no transferable operation, nothing for a buyer to acquire once the owner steps away. A company with 15 employees is a different kind of asset. It has systems, relationships, and revenue that don't automatically disappear if the owner leaves. That's exactly the kind of business a buyer, a family member, or a management team can actually take over. If that's your business, the odds are already tilted in your favor. What you do with that advantage is the rest of this article.

Here's where the good news gets complicated. Having "a plan to sell or transfer" is a low bar. The survey doesn't distinguish between an owner who has genuinely worked through his options and one who has simply told himself, "I'll sell it to my son someday," without ever testing whether that's realistic.

That distinction matters more than the headline number. A plan that hasn't been pressure-tested against reality isn't a plan. It's a hope with a timeline attached.

Start with the exit route itself. Family transfer, management buyout, and third-party sale each require different preparation, different financing, and different timelines, and most owners default to whichever one feels most familiar rather than the one that actually fits their situation (see What's the Right Business Exit Strategy for You? for how to work through that decision). If your plan assumes your daughter will take over the business, has she actually agreed to that? Does she want it? Can she afford to buy you out, or are you expecting to just hand it over?

Then there's the business itself. A transfer plan doesn't mean much if the business can't function without you in it. If you stepped away for 90 days, would it keep running the way it does today, or would things start to slip? That single test, owner dependency, is one of the most common reasons a "plan" never turns into a completed transaction (see Why Owner-Dependent Businesses Are Harder to Sell).

There's a timing argument here too, separate from readiness. As more Baby Boomer owners reach the point of transitioning their businesses over the next decade, the pool of sellers is set to keep growing. A business that's genuinely prepared, clean financials, real management depth, a tested succession path, stands out more in a crowded field of sellers than it does today. An unprepared business doesn't just fail to stand out. It gets overlooked entirely, or it becomes one of the closures instead of one of the sales.

That's the real cost of treating "I'll deal with it eventually" as a strategy. It's not that you'll miss a single narrow window. It's that every year you wait, you're competing against a larger number of other owners making the same decision at the same time, some of whom started preparing years earlier than you did.

None of this requires a decision today about when you'll actually sell. Learning how to exit a business well starts with an honest look at whether your intention to sell or transfer the business is backed by anything real.

Pick the exit route you've been assuming, family transfer, management buyout, or third-party sale, and ask whether you've actually tested it. Talk to the people you're assuming will be involved. Find out whether they want what you're planning to hand them, and whether they can afford it if the plan requires a buyout.

Then take an honest look at whether the business could run without you for a real stretch of time. If the answer is no, that's not a reason to panic. It's a reason to start working on it now, while you still have years to fix it instead of weeks.

Finally, put something in writing, even a page. Not a formal exit plan with an advisor, just a clear statement of which route you're aiming for, who's involved, and what would need to be true for it to work. Revisit it once a year. An intention that lives only in your head is easy to keep vague. One written down gets tested against reality a lot faster.

The owners who end up in the 1 million that actually sell, rather than the millions that close, won't be the ones who happened to get lucky. They'll be the ones who stopped mistaking intention for preparation while there was still time to close the gap.