There have been more than a few comments on The Kneeslider stating demographics are against some companies, like Harley Davidson, who see their customer base getting older, and, especially during this recession, losing their jobs, what will they do to attract younger, employed buyers? It depends a lot on what you consider younger and older, and what you consider employed. Many of those “old” riders have a lot of riding years remaining. They also tend to start and run a lot of businesses.
If you’ve been reading my previous posts about rediscovering hands on work and what a great time it is to start a new business and especially if you liked my post that asked “What recession? Just do it!” you’ll like what I came across the other day.
In a recent study, a surprising result shows that entrepreneurship actually goes up as age increases. The big and famous business successes in the younger group, usually centered around the Internet and getting lots of press, make everyone think the action is confined there. Not so.
Contrary to popularly held assumptions, it turns out that over the past decade or so, the highest rate of entrepreneurial activity belongs to the 55-64 age group. The 20-34 age bracket, meanwhile, which we usually identify with swashbuckling and risk-taking youth (think Facebook and Google), has the lowest rate. Perhaps most surprising, this disparity occurred during the eleven years surrounding the dot-com boom—when the young entrepreneurial upstart became a cultural icon.
It seems, the recession is a prime time for older folks to start businesses, potentially pulling everyone else out of this mess. They’re also going to be healthy and active and participating in areas (like motorcycle riding, perhaps?) formerly thought to be the preserve of the “young.”
… a steady increase in life expectancy also means that Americans are not only living longer but also living healthier longer, suggesting that those entrepreneurial 60-year olds could be 2020’s entrepreneurial 70-year-olds.
Those of us who are more vintage than showroom new are often very healthy and we have a lot of knowledge, skills and experience. If you find your job is in jeopardy, don’t look for another one, start a business and create your own. Instead of competing with the 25 year old, start a company and before long, you may be offering him or her a job.
Some are concerned that:
… it could be more likely that the older entrepreneur starts a “lifestyle†company while the younger entrepreneur starts a world-changing firm.
On the other hand:
… an older worker’s experience—while possibly limiting his or her innovative
thinking—might allow him or her a greater scope for innovation that challenges existing companies.
And another study found, “… great innovation is less and less the provenance of the young.”
While the current recession is very real, many in the 50+ age group carry a lot of knowledge and skill with them, an extremely valuable resource. While younger folks still need to learn a lot, consuming much time and money, the older group already has the knowledge and skill and can act right now to take advantage of opportunities. Instead of sitting around and waiting for something to happen, we can make things happen.
Some may be surprised to see how many older people are starting new businesses in the near future and riding motorcycles and having a great time doing both. Attitude plays a huge part. Harley may not have as much to worry about in this particular aspect of their business as some believe. Like I said before, it’s a great time to start a motorcycle company. Life is good. Just do it.
Link: Old and in the Fray
Link: Baby Boom Generation is Driving an Entrepreneurial Boom
Pat says
What I find interesting about Harley is that they grew so big (during a prosperous economy) depending on the assumption that every garage needs a Harley. Go figure they are in a bit of trouble with these economic times. The big four Japanese motorcycle manufactures have other ventures to help them out; Honda and Suzuki have cars and generators, Yamaha have instruments, sound systems and watercraft/outboard motors, Kawasaki have heavy industries all make some sort of ATV or snow mobile. Harley has clothing?- good luck with that.
nobody says
Yeah, the car industry sure would be a good venture to have right now……
The “other ventures” of Kawasaki & Yamaha predate their involvement in the motorcycle industry by many decades. I don’t know if it is true, but I’ve been told that the motorcycle division is more of a hobby than anything else for Kawasaki.
Back to the article – thanks for posting that! I appreciate the positive motivation. I hope the pavlovian responders figure it out.
GenWaylaid says
As someone in the 20-34 age group, I agree that the advantage in entrepreneurship lies with the more experienced. Off the top of my head I can think of three advantages a 55 year old is likely to have over me in starting a company:
1) personal seed capital
2) a more in-depth knowledge of their market and competitors
3) they finally have their student loans paid off
Azzy says
Nobody – the Japanese car manufacturers that mke cars in the US are still turning a profit, which is a place to be no matter the industry.
nobody says
Azzy,
The last thing I read about Toyota, that powerhouse of automotive perfection, was that they are globally losing money on their core (i.e., CARS) for the first time in 70 years. I don’t blame it on Toyota.
In the last 12 months:
Toyota’s sales in the USA? Down 39%
Honda’s sales in the USA? Down 34%
Suzuki’s car/truck sales in the USA? Down 56%!!!!!!!! Yeah, it’s good thing they make cars in addition to motorcycles.
Harley’s retail sales in the USA first quarter 2008 – first quater 2009? Down 9.7% The car guys wish they had it that good.
Last I heard, Harley is still turning a profit. That some Japanese factories are profitable in the USA sure says lots of good things, but globally, the car business is still in the toilet. Oh yes – last time I heard, Kawasaki quit making snowmobiles in the USA a very long time ago. And what ever happened to Honda’s American motorcycle factory?
What never dawned on Pat, obviously, is that if the economic climate isn’t favorable to motorcycles, then it is even less favorable to snowmobiles, ATVs, watercraft, outboard motors, etc.. either. Nobody commutes on any of said moto-toys or buys them to save gas when times are tough.
None of which has anything to to with the article, other than that the words “Harley” and “Davidson” were mentioned, so therefore, the keyboard MBAs have to kick in their own 2 cents.
Disclamer: I currently own several Kawasaki projects and no Harleys. Nor do I like a whole lot of what Harley does. But, again, that has little to do with the above article. As a 46 year old “doer’, the article confirms an awful lot of my observations.
Walt says
I don’t quite understand what entrepreneurship by older folks has to do with Harley’s demographic challenge. Older folks aren’t dead yet. I started my own consulting business nine years ago, at 56. I agree with GenWaylaid that older people tend to have more business experience and may have enough savings to keep going while the business starts up. On the other hand there are countless examples of youngsters who started businesses too, of course, even in their teens.
The demographic issue for Harley is the same faced by Cadillac, Lincoln and Buick: they’re in danger of becoming the oldster’s ride. The machines are relatively expensive (harder for young people to afford) and more importantly, they have an image problem. The badass image Harley likes to play off is based on experiences of the 1940s (bobbers), ’50s (Rebel Without a Cause) and ’60s (choppers). For people alive in those days, those images are compelling. For younger people, alien. Unless Harley can appeal to younger riders its core clientele will inevitably graduate to walkers and electric scooters. Maybe they should try golf carts?
The good news is that brand images can be altered. Cadillac (before GM’s recent collapse) managed to turn the tide somewhat with edgier styling, performance models (though they still build cushmobiles too) and Led Zeppelin in their commercials. (Escalades appeal to the gangsta crowd, but that’s a different issue.)
They didn’t have to appeal to twenty-somethings, but people in their 30s and 40s. I don’t see that Harley has figured out how to do that yet.
kneeslider says
Walt,
“I don’t quite understand what entrepreneurship by older folks has to do with Harley’s demographic challenge.”
There still seems to be this idea that older folks are just slowing down and sitting in their Lazy Boy recliners. As baby boomers age, everyone is writing them off as no longer relevant to the motorcycle market. This study shows that boomers are very active and likely to remain so for quite some time.
Whatever Harley’s problems are, using too loose credit rules to sell more bikes might be a big one, the problem isn’t simply caused by their clientele getting older which is the first thing many seem to point to. Too loose credit might even apply more to their younger buyers who don’t have the funds to buy.
GenWaylaid says
Walt, I sure hope Harley takes your advice. There are few car designs more insulting to me than those targeted at “young buyers.” For some reason the car companies think that anyone under thirty wants to drive around in a permanent disco and that the only input device we know how to use is an iPhone. I shudder to think what a motorcycle company would come up with. (Though I do recall that one of the TTXGP competitors used an iPhone for their dash and it actually looked appropriate.)
B*A*M*F says
@ GenWaylaid?
You mean you don’t want to drive around in an iPhone Disco world? Gen X & Y are officially kicking you out.
I actually agree with you on this point. When I was car shopping almost 2 years ago the top cars I was considering were the Scion xB, Honda Fit, and Mazda3 hatch. There were a few other stray options, but those were the three cars about which I was most serious. I was 26 at the time and the one that made the most sense was the Mazda3. Unlike the Scion, it was not intended to be a “lifestyle” (whatever the hell that means) youth mobile. The Fit just didn’t have enough towing capacity for a trailer and a (small) bike or two. I ended up with something that I’ve seen driven by kids my age and people older than my parents. I’m pretty happy with that.
I work at a very small entrepreneurial venture. I am one of 3 full time employees and we have one summer intern. The owner is 29, the other full-timer and myself are 28. The business started when the owner got fed up with some of the BS at his job and decided he could do better. 5 years later, and we’re quite busy. Though I agree that typically older people have some advantages in business:
1) Knowledge. They tend to possess more business and field knowledge than young folk.
2) Capital. They usually have more seed money on hand than a 20 or 30 something.
3) Grown families. Most people my parents age (mid 50s) have their kids out of the house and out of college, or somewhat close. Everyone I know who is my age (late 20s and early 30s) is either getting married, having kids, or raising a litter of tykes. It’s harder to start a business when you’ve got a new spouse, new kid, or a bunch of younger children clamoring for your attention.
todd says
Harley down 9.7%? That’s not bad at all considering. I wonder how BMW is doing? BMW Motorcycles is down 32%. Their car division is fairing much nicer; down 4% but their MINI is up 29% and their Rolls Royce brand is up 17% (449 cars sold in one year!). I would tend to think that BMW also appeals to the aging Boomer generation (GS stuff).
I too always thought baby boomer would be riding walkers. However, my dad is spending his retirement years as a volunteer laying rail road track for the Niles Canyon Historical Rail Road. That’s some seriously tough work. Though he wouldn’t be one to buy a new Harley or a BMW – he’d fix up his AJS or CB400F instead – he’s in the position to do so or start up a company if he likes. No responsibilities, plenty of money. I, on the other hand, at 36 have tons of responsibilities and a shaky immediate future income situation. I’m more worried about paying the bills and keeping the house.
I guess I’m in the MINI demographic, at least it appeals to me mostly out of what’s new. Even more so would be an early VW Rabbit or a 914; I like simple, fun, light cars. It’s weird that MINI is doing so well, it goes against the thesis of this post.
-todd
reffect says
@ B*A*M*F
Being mid 30s with two little ones myself, I find it near impossible to start my own venture–not without sacrificing the attention/nurturing that the children need. Right now, I’m treating these years as early research and development (a.k.a. pet projects). Later on there will come a day when all these ideas are ripe for fruition.
Ted says
I’m sorry but I had to laugh when I read ‘The Population is Ageing”,,,Really, could have fooled me.
Mitch Ferguson says
Us “old people” still got it! I’ve been riding for about 22 years now, and I don’t intend to stop any time soon. I’m trying to help everyone feel better and live longer. I think motorcycling does you a lot of good. My website can be of help, too. It’s http://www.be-happy-thru-wisdom.com . I really hope it makes your days better!
scritch says
A big disadvantage for us aging Boomers (I’m 55) is that we don’t usually have as much energy as before. However, a huge advantage we have is focus. As stated above, we don’t have the same careers, loans, spouses, kids, large mortgages, and hormones distracting us as when we were younger. I’ve even cut waaaay down on my vices, so I have more time to focus on starting something new.