The Boomer New Biz Boom: Finance Tips for the Latest Wave of Small Business Owners
In the small business report released in May 2024, the U.S. Chamber of Commerce noted a significant trend is emerging in the business landscape; more than half (51%) of individuals venturing into entrepreneurship are aged 55 and above.
Moreover, World Health Organization (WHO) projections indicate that by 2050, the population of individuals over 60 is set to nearly double. With Baby Boomers gradually exiting or facing challenges in employment settings, experts anticipate an increase in this percentage.
Despite these developments, there are challenges on the horizon. Recent data showed a concerning 53% surge in business bankruptcies compared to the same time last year. This striking statistic underscores the importance for Boomers to grasp the significance of establishing sound financial practices and positioning their ventures for sustainable growth and credibility when seeking loans.
Richard Gusmano, who serves as both founder and CEO, at BCCUSA, has dedicated close to twenty years assisting entrepreneurs in navigating their landscapes and meeting bank requirements effectively. Richard gives his perspective on the increase of entrepreneurs and provides advice on how to make your company more appealing for loan approval.
The Emergence of Boomer Entrepreneurs
The growing number of entrepreneurs can be explained by various reasons. Many individuals in this age group have amassed experience and expertise throughout their careers, making them well suited to venture into entrepreneurship. With a focus on healthy living, people are living longer, and older individuals are choosing not to retire conventionally.
The current economic situation also has an impact. With companies undergoing restructuring or downsizing, many Boomers find themselves excluded from the workforce. Rather than pursuing job opportunities, they opt to utilize their skills and embark on their own business endeavors. This transition is not only altering the landscape of business ownership, but it is also contributing to economic advancement and creativity. Instead, they are seeking challenges and new opportunities to explore income, often opting for entrepreneurship to remain active and involved.
Guidelines for Enhancing Your Company’s Appeal for Loan Approval
Establishing a business is one aspect; however, obtaining funding as you expand is another challenge altogether. Here are some crucial recommendations to enhance your company’s appeal for loan approval.
Get to Know Your Financials
The first step in enhancing your company’s appeal for loan approval involves understanding your status.
Make sure you keep your records, like balance sheets, income statements and cash flow statements, updated. These papers show how your business is doing financially and are essential when you want a loan.
Craft a business plan that covers your business goals, strategies, market analysis and financial forecasts. Also, explain clearly how you’ll use the loan money and how you plan to pay it back. A thorough plan shows lenders that you have a vision and strategy for your business.
Maintain business credit scores as they influence lending decisions greatly. Check that your credit reports are correct and fix any errors and pay your bills on time to lower debt levels. A strong credit history boosts your credibility with lenders and enhances your chances of getting a loan.
Establish Relationships with Lenders or Credit Consultants
Develop connections with lenders to help with securing financing. You can start by opening a business account with a bank and staying in touch with your banker regularly. Attend networking events and join business groups to meet potential lenders.
Or if you’re a more established business with at least two years in business you could look to working with a business credit consultant, like BCCUSA. They leverage an extensive list of banking partners and relationships nationwide and can oftentimes help connect you with the right lender for your needs and industry, furthering your chances for lending approval. Working with a business consultant such as this can streamline the process of applying for a loan and improve your chances of getting approved.
Highlight Your Experience and Skills
It’s important for lenders to see that you have the experience and skills to effectively manage a business. Showcase your background, expertise and achievements in your loan application. If you have a management team, underscore their qualifications too. Demonstrating that you have a team in place can instill confidence in lenders regarding your business’s potential for success.
Take Your Time on Loan Applications
The loan application process can be intricate and time consuming. Make sure you are ready to furnish in depth information about your business, including statements, tax returns and legal paperwork.
Be open and truthful in your application and be prepared to address any queries the lender might pose. Proper preparation and attention to detail can significantly affect the outcome of your loan application.
There is Hope for Boomer Business Owners
The increasing number of Baby Boomer entrepreneurs reflects the resilience and adaptability of this generation. With Boomers venturing into business ownership, it is essential to grasp the financial aspects of managing a business and positioning oneself for loan approval and overall company growth.
Starting a business is both challenging and fulfilling, regardless of age. With preparation and expertise, Boomers can use their experience to build ventures and contribute to economic growth.
Richard Gusmano, is the founder and CEO of BCCUSA.
