Brad Ruth, founder of Great Lakes Business Advisors
Brad Ruth, founder of Great Lakes Business Advisors Great Lakes Business Advisors

Roughly 12 million businesses owned by baby boomers are expected to change hands over the next decade, representing nearly $10 trillion in assets, according to JPMorgan Chase's 2026 report, as covered by Yahoo Finance. Yet only 8% of owners say they have reached an advanced stage of planning, while 70% remain in the early stages. For the trades, the exposure is sharper. Approximately one-fifth of all electricians are over 55, according to Associated Builders and Contractors' 2026 workforce analysis as reported by Construction Executive. The largest transfer of wealth in American history is arriving, and the businesses most exposed to it are the ones that keep the country running.

The problem is not that these businesses are failing. It is that most of them were never built to be sold. According to FMI's 2026 update on ownership transitions, 58% of engineering and construction firm owners still do not have a formal ownership transfer plan, unchanged from the 2024 study that first identified the gap. Among owners planning to exit within five years, 51% have no defined strategy at all. A business without a plan is not a business.

The reason is structural, not personal. The trades attract people with extraordinary technical skill. A plumber spends fifteen years mastering the craft, sees an opportunity, and starts a company. The same instinct that made them excellent at the work makes them indispensable to the business. They are the one who answers the emergency call, who knows the customer, who can diagnose the problem in five minutes. That is a strength, until it becomes the only thing the business has.

A buyer does not purchase a person. A buyer purchases a system. Documented processes, a team that can operate without the founder, a customer base that is diversified rather than concentrated around three relationships. When a trades owner sells without those in place, the buyer walks into a brand and a list of customers who expect business as usual. That is not an acquisition. That is a gamble.

Brad Ruth, founder of Great Lakes Business Advisors, and associate member of both Plumbing-Heating-Cooling Contractors Association (PHCC) and Air Conditioning Contractors of America (ACCA), has spent more than three decades building and selling. He has watched this pattern repeat from the other side of the table, and his assessment of the gap is blunt. "The biggest challenge we face in this industry is owners not understanding that they have to prepare the business for sale," he says. "It is not something you just call about and go to market. Sometimes it can, if you have been running it with the end in mind. But most of the time, adjustments have to be made."

Those adjustments take predictable forms. An owner who is the bottleneck has to decentralize. A business with one customer representing a quarter of sales has to diversify. A company whose profits swing from $1.5 million one year to a $750,000 loss the next must stabilize its operations before any buyer will consider it. Ruth describes a power-washing owner who was proud of doing every job himself. "That is not a business," Ruth observes. "That is a job."

The gap between what owners believe their business is worth and what the market will pay is the hardest conversation in the industry. When a business is valued at $750,000, and the owner needs $1.5 million to fund retirement, the result is a gap no sale price can close. "I have to tell business owners their baby is ugly quite often," he says. "It is the hardest part of the work."

Even owners who never intend to sell are not exempt. Ruth points to what the industry calls the five Ds: death, divorce, disagreement, distress, and declining health. Half of all business transfers happen for one of those reasons, he estimates. An owner who has not planned for a sale may still be forced into one, and a forced sale is the worst possible time to discover the business is not ready. When the trigger is a death or a health crisis, the timeline belongs to the buyer, not the seller. There is no runway to build the team, document the processes, or stabilize the numbers. The owner negotiates from urgency, and the price reflects it.

That is why Ruth treats planning as a form of insurance against the events no one schedules. The fix is not complicated, but it takes time. A business valuation establishes where the company stands today. A longer runway allows the owner to build the team, document the processes, and reduce dependence on a single person. Ruth works with a network of operations, sales, and finance consultants who take on the pieces he does not handle himself. The goal is not to lower expectations. It is to build a business that a buyer will pay for, and that the owner might not want to sell once it runs without them. Ruth asks his clients, "If we make the business easier to run, would you still want to sell it?" The answer is often no, and that is a success.

The next decade will define what a successful handoff looks like in the trades, or it will serve as a warning to the generation that follows. The clock is already running. Owners who act now can shape the outcome. Owners who wait will be shaped by it.