Baby Boomers own 40% of all small businesses and franchises in the US. Over a third have operated for 10+ years, and 3 in 4 are profitable. They’re an important part of the nation’s economy, but what happens to these businesses as their owners age? The youngest Baby Boomer is 58 this year. Thousands of Boomers are retiring every day.
Some Boomer-owned businesses may go to the owner’s children, but that outcome isn’t guaranteed. 58% of small business owners have no succession plan. With rising costs for health services and long term care, some Boomers may sell their business to pay for retirement. Such a sale can be difficult.
Most small businesses aren’t on private equity’s radar. Despite this, they can still be a good investment for a Millennial looking to become his or her own boss. As mentioned, many are already established and profitable. They have a distinct brand with loyal customers. Buying an existing business from a retiring owner may be easier than starting one. Exiting business owners want to leave their labor of love in good hands. They want to know the new owner will have the experience necessary and will keep their business’s current workers employed.
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