In Hendricks County Indiana there are approximately 1,088 businesses with owners aged 55 or over.  These businesses employee over 13K residents, with a payroll over $400M, and $2B in revenue.  What will happen to these businesses when their owners decide to retire?

According to the Annual Survey of Entrepreneurs, a survey of over 100 thousand Indiana businesses (2016), identified the following exit strategies:

• 0.4% Transition via an IPO
• 4.1% Some other (non defined) exit strategy
• 8.6% Sell business to employees or managers
• 11.4% Sell or merge with another firm
• 11.8% Liquidate or sell off assets and repay businesses’ liabilities
• 12.1% Sell or transfer ownership to another owner of the same business
• 12.4% Sell or transfer ownership of the business to a family member(s) that is not a current owner
• 12.5% Walk away from the business
• 19.5% Sell business to another individual that is not a current owner
• 31.5% No exit strategy for any owner

While the above data is somewhat dated, it is consistent with more recent studies FISART Article  identified that 92% of small business will simply stop operating, and of these sold, 5% were sold to a third party, with 3% selling to a family member, employee, or partner.

Additionally, Gallup in 2025 identified that only 33% of small business owners have a succession plan, and a significant number of business owners had no formal exit strategy (48% Small Business Trends/ BizBuySell, 80% Exit planning institute).  Teamshares identified that 70% of small businesses fail to sell at time of retirement, and only 20-30% of business that go to market actually close a sale (BizBuySell/IBBA).

There is a better answer – why not sell your company to your employees? For more information See Non-ESOP Business Owner Information.