Throughout the majority of 2020, Canadian businesses faced unprecedented change. While much is still uncertain about what the the future will hold for businesses owners across the country, the International Business Brokers Association (IBBA) Market Pulse report for Q4 of 2020 indicates that construction, manufacturing, and business services businesses have continued to be in high demand throughout the COVID-19 pandemic. If you are a business owner in one of these industries, consider starting to plan now for your eventual exit.
Construction
After a setback following the recession, the construction sector made a comeback in more recent years. A recent study by Procore Technologies Inc., a leading provider of construction management software, revealed that more than 70% of Canadian construction companies had as many or more projects during the first six months of the COVID-19 pandemic compared to before, so it is no wonder why these businesses are in high demand. In Q4 of 2020, construction businesses made up 10% of main street businesses and 16% of lower middle market business sold. If you’re considering exiting this market, 2021 may be the year to list your construction company for sale.
Manufacturing
Manufacturing is a key industry in Canada, accounting for $174 billion of total GDP (10%). Since the COVID-19 pandemic began, most manufacturing businesses have been able to survive and are proving to be somewhat immune to the economic effects of the pandemic. Additionally, rebounding commodity prices are also expected to promote a surge in revenue growth in the industry. With these favorable anticipations, buyers are now on the lookout for profitable manufacturing opportunities. In Q4 of 2020, manufacturing businesses made up 6% of main street businesses and 17% of lower middle market business sold, indicating the demand for manufacturing businesses continues to be strong.
Business Services
Like the first two industries mentioned, business services have generally done well since the onset of COVID-19. Despite the pandemic, they’re still accounting for 11% of main street sales and 15% of middle market sales. Services like financial planning and law firms, in particular, are projected to rise in demand and see a growing customer base due to the ageing population and their increasing disposable incomes.
If you are a business owner and are thinking about selling your business, make sure you receive proper advice. Click here to contact a trusted business advisor today!