How to Start Your Own Business after 50
Some people over the age of 50 fear starting their own businesses because of concerns about financial security, their ages and the general misconception that entrepreneurship is the exclusive province of talented code writers around the age of 20. Contrary to popular opinion, people older than 50 are more successful when starting their own businesses. Many can borrow from their retirement plans to capitalize their companies, and their years of experience have tempered them with patience and a determination to succeed.
It’s easier than ever to succeed in business with the right planning, products or services and expanded financing options available through online resources. If you want to start a corporation, you can sell shares of crowdfunding websites. If you write a strong business plan, you can attract investors. You could also form a partnership with a respected friend or colleague. The older you are, the more likely you’ve paid down the critical expenses such as mortgages, child-raising expenses, student loans, and other obligations. You can use your equity or retirement savings to fund your business venture. Older entrepreneurs know their own capabilities and what they are doing, so their prospects for success tend to be higher than those of younger people.
How to Get Started
The first step is deciding what products or services that you want to sell and determining whether there’s a realistic market for them. You can manufacture or create products, buy products at wholesale prices and sell them at a markup, or find companies that offer affiliate marketing arrangements where you don’t have to produce or store products. Don’t worry about themes, catchy logos, or shipping options at this stage. Product or service research is a critical step that you can’t afford to dismiss.
Niche products are goods that have a built-in market among aficionados. For example, golfers love golf clubs, bags, golf wear, golf carts, and other related products. Culinary enthusiasts are more likely to buy upscale kitchen gadgets, better cookware, gourmet condiments, and high-end tableware. Commoditized products are those that everyone needs. These include clothing, food staples, linens, towels, and bath accessories. Startups usually can’t compete with the big retailers online, but if you offer a mix of niche and commoditized products, you can succeed.
It’s important to research consumer demand for the products that you want to sell. If the merchandise or service is already branded, you can capitalize on the brand name. If it isn’t, create a memorable name and try to brand the product in a way that speaks to certain buyer profiles such as bargain shoppers, discriminating consumers, or analytical buyers. Market research determines whether there’s really a market for your products and services. You can’t rely on gut instinct.
Answers to the following questions are critical when conducting your research:
- Research market trends — is the economy expanding or contracting?
- What industry do you want to enter? Is it doing well?
- What are the demographics of the people who live near your chosen brick-and-mortar location?
- Can people in the neighborhood afford your prices?
- Who are your competitors online and/or in your retail location?
- Are there already too many similar businesses in the area?
- If selling online, where will you market your products? Locally or globally?
The costs of starting your business depend on the form your business takes. Many entrepreneurs start online businesses with minimal expenses. Some creative people buy products at yard sales and refurbish them to sell online. Old clothing becomes vintage clothing and commands higher prices. It’s relatively inexpensive to start this kind of business, but the labor can be more demanding than other types of businesses.
If you plan to start a retail business, your costs include renting or buying a place to sell or locate your service business and the costs of utilities, legal fees, cost permits, and payroll for staff. There are also costs for inventory, marketing, creating a company website, researching the business, writing a business plan, furnishing your business, and decorating the space. The Small Business Administration, or SBA, can offer planning assistance and a convenient cost calculator to estimate your capitalization needs. The SBA estimates that home-based businesses can cost as little $3,000, and home-based franchises can be started with just $1,000 to $5,000 in capital.
Most independent businesses cost more, so it’s important to estimate your needs as accurately as possible. Most businesses require some form of business insurance. Other costs might include deposits, costs of obtaining a lease, vehicle expenses, and equipment costs.
Tips on How to Sell your Product or Service
Even if you start a brick-and-mortar business, it’s important to learn the lessons of today’s marketing best practices. Developing an online marketing strategy is critical to success. Even retail stores now reach local customers through Internet marketing, social media, and word-of-mouth referrals, which are now sent by links and emails over mobile phones. Your marketing plan should include a balance of traditional and digital marketing strategies. If you sell exclusively online, a digital campaign is essential, but you can stimulate sales and attract loyal customers to a retail location with both kinds of marketing.
Many successful entrepreneurs don’t sell a product but sell the idea of a product and the benefits it can deliver. Steve Jobs once said that the iPhone wasn’t a product but a lifestyle. The strategy worked and resulted in the astonishing success for Apple smartphones, which captured 19 percent of the market in the last quarter of 2017.
Content and keywords are used to optimize your company website for search engine optimization, or SEO. This is the way that you make your business more visible to search engines and ensure a higher ranking on search engine return pages, or SERPs. Creating informative content is also the way to foster desire for your product by posting articles on social media platforms, creating product descriptions, and generating human interest in your company’s success.
Set a Timeline
It’s critical to set a realistic timeline for success. That means setting goals for success and adjusting your plans. If you meet your goals, you should set higher goals for the future. If you fail, you need to reassess your strategy. Your timeline depends on developing a business plan, according to a Guidant Financial article and many other expert business consultants. A strong business plan identifies SWOT factors such as strengths, weaknesses, opportunities, and threats.
You should reassess your plans after six months to see if your business is performing to expectations. If things aren’t working as expected, build your network of contacts, change your advertising strategy, adapt to new trends, and streamline expenses. A few percentage points of profit can often determine success or failure, so running a tight ship is important. You might try to find cheaper suppliers, tighten payroll, reduce operating expenses, and take other measures to meet your business goals.
Every Business Is a Risk, but Older People Are Poised for Success
Statistics show that entrepreneurs between the ages of 55 and 64 have the highest rate of success when starting new businesses during the last 10 years. This isn’t exactly a new phenomenon, but digital access enables older people to compete at higher levels. However, some of the world’s most famous brands were created by people over 50 including Ray Kroc, founder of McDonald’s, John Pemberton, founder of Coca-Cola, and Colonel Harland Sanders, who found KFC at the age of 65.
Young tech geniuses aren’t the only entrepreneurs who are achieving success in today’s markets. About 25 percent of successful entrepreneurs are 55 or older. The rate has grown faster for older entrepreneurs than any other age group during the last 20 years. You can succeed with planning, commitment and a can-do attitude. Your chances of success have never been better than in today’s accessible marketplaces.