Described as the “silver tsunami,” the sudden rush of older aged Americans retiring from the workforce is impacting the economy and the future of many small businesses. 

Also known as the “gray wave,” the United States economy struggles to adjust to the almost 11,000 baby boomers retiring and leaving the workforce every day. And that impact is especially hard as boomers who own small businesses struggle to decide what to do with their companies when they retire. 

Ray Drew, a Managing Business Development Officer with the Fund-Ex Solutions Group, says retiring boomers must make a tough decision when deciding to sell their business. While some may think it’s easy to pass the business off to the next generation, Drew says many children of baby boomers have little to no interest in running the family store. That leaves sellers with the difficult task of finding a buyer. 

While finding a buyer isn’t always the easiest thing to do, Drew says the bulk of the weight of the decision lies with the buyer. While buying an existing business might be easier and more affordable than starting a company from scratch, there are some pitfalls to purchasing an existing business. 

Drew says buyers need to do their due diligence. While the company might already have cash flow, that doesn’t always mean it’s positive cash flow. Buyers also need to ensure they have the proper experience and skill set required to run and manage a certain business. Someone with a degree and career in accounting may not be suited to run a restaurant.   

Still, the allure of purchasing a small business is calling to many wannabe entrepreneurs. “Not everyone has that million-dollar idea to go start a business,” Drew says. Buying a company that has already thought up and market-tested an idea is a great way to boost your career as a business owner. 

Many younger generations are flocking to owning their business because they want to work for themselves. With the help of the Small Business Administration, they are obtaining loans to chase those dreams. Drew says many people who apply for a loan need a 10% down payment and good credit. An SBA loan can help you start from the bottom or purchase a proven business from a retiring baby boomer.