Entrepreneurship may be viewed as the province of the young, but new business owners are just as likely to be in their silver years. That’s a compelling statistic from a study sponsored by the Kauffman Foundation and LegalZoom. In fact, 35% of new business owners in the U.S. are over the age of 50. At FranNet DFW, we’ve certainly found that mature professionals make excellent franchise owners. Here’s a look at some of the reasons our older clients are looking for new opportunities and some of the special considerations for this age group.
Why Franchise Now?
Previous generations may have been looking forward to retirement at the end of a long career at this stage in life. But today’s professionals over 50 are simply looking for their next big career change. They tend to be tired of the rat race of the corporate world, but they still have plenty of energy to devote to a business they really care about. Here are the top three reasons our older clients tell us they want to own a business:
- They are tired of someone else controlling their future
- They want more flexibility and autonomy in determining their schedule
- They are sick of traveling for work
What Do These Prospective Business Owners Bring to the Table?
Fortunately, having more life and work experience puts mid-life professionals in an ideal position to become business owners. They often have insight into sales, management, finance, and many other areas of business that they can put to good use in running their own company. Today’s options for franchising include many business categories outside the food service industry that may be a good fit for professionals with primarily white collar experience. They can translate existing skills into a new environment.
People who have already enjoyed a long and successful career may also be in a strong position to fund their own franchise purchase. According to the Kauffman study, the use of personal savings is becoming much more popular as a means of buying a business. In 2012, savings accounted for 66 percent of funding. That percentage jumped all the way to 86 percent in 2013. Older franchisees are more likely to have a nest egg that they can use to invest in a business that helps create the retirement they really want.
Finally, finding the right franchise opportunity takes effort, and mature professionals are likely to seek out and listen to expert advice so they make a smart decision. They know they can’t afford to get it wrong so close to retirement.
Special Considerations for Older Franchisees
At this age, franchisees may have different concerns than younger professionals. Physical limitations may determine how active a business owner wants to be. Some may not want to spend a huge amount of time driving to appointments or working in an industry with a lot of physical activity. Others may be tired of managing people all day and enjoy running a one-person franchise until they are ready to scale out.
From a financial perspective, older franchisees are looking at a shorter time from acquisition until they will need to implement an exit strategy. These end-stage options might include selling the franchise, passing it on to the next generation, taking a back seat and letting someone else manage the business, etc. They may be looking at a franchise that can offer a faster ROI rather than one that is slower to start showing a profit.
At FranNet Dallas/Fort Worth, we counsel each client based on their skills, goals, resources, and career stage. We have excellent success identifying franchise models that are attractive for professionals in mid-life and beyond. Contact us to learn more. We can show you that there is life after 50—and good business opportunity as well!