Deciding to start your own business can be fraught with difficult choices. When to take the plunge and what business to begin are probably the hardest to decide. Combine tricky startup dilemmas with a recession, and the options available become an ever-increasing circle of doubts and pitfalls.
With many customers reducing their expenses, businesses can struggle to survive. You could find yourself facing an uphill battle to get off the ground. Recessions can paint a negative picture of an economy in free-fall with no hope for any business or venture caught up in the downward dive.
Truth can be stranger than fiction, though. Recessions are not always the big bad wolf of economics they are portrayed to be. For some businesses, they can be a positive. Especially when it comes to startups.
As a brand new venture, your business can learn from the experience and mistakes of existing companies already trading in the shadow of recession. Their struggle will help you identify the best practice to cut through the gloom with pointers on things to avoid. With so much information at your fingertips, you’re almost ready to launch your budding new company out into the wide business world.
It’s just a case of knowing what business to start.
The purpose of any business is to sell products or services to a consumer. To be able to do that, they must either need or want the item. Your business has to offer something your potential clients have a reason to buy. Otherwise, their money will remain firmly entrenched in their pockets. The key to any successful business is knowing consumers are driven by their needs and their wants. This is true when markets are buoyant. It’s even more so when a recession restricts expendable income.
In a recession, buying revolves around need. Potential clients will concentrate on limiting spending to essentials. Things they may want but can live without will be put on a back burner. Which basically means, to stand the greatest chance of survival during a recession, your business should offer a commodity your customers can’t do without.
So what are the best businesses to start during a recession?
Here are five businesses most likely to thrive in an economic downturn and why they have a better chance than most when it comes to weathering a financial storm.
Logo Design Service
With every new recession comes a burst of new businesses across the country. When people lose jobs and can’t find a new one, they often have no choice but to start their own business to survive financially. When starting a new business, one of the first things they will need is a website and a logo. If you are a graphic designer, you will be in high demand to create logos, website designs, banner designs, and signage for the new and upcoming businesses.
Recessions tend to highlight industries people cannot live without. Coming out at the top of the safe-bet list is any business that offers food. Grocery stores with stocks of pantry staples and household necessities will breeze through a recession like a knife through butter. Whether it’s a big-box store offering a multitude of items to a local artisan bread shop, your business is certain for survival if you cater to the needs of your customers’ stomachs.
It’s an undeniable fact everyone needs food. A significant number of people also like someone else to do the cooking. What better way to feel good in a downturn than to check in at a fast food outlet for a burger to go?
Even when money is hard to come by, people still frequent their preferred take-out location. Making a ready-to-eat food service one of the most likely businesses to thrive in a recession.
In fact, fast food outlets tick a couple of boxes when it comes to beating the recession blues. If you run a business offering cooked food to eat out, it provides an outlet for your customers’ indulgent nature. Providing nourishing meals in the fraction of the time they could cook it themselves. Instant gratification wrapped up in a take-out box.
Combining customer indulgence with the free publicity gained from branded grocery bags and containers, your food based venture becomes practically bulletproof.
This category covers a wide range of essential services critical to individuals’ well-being and the communities they belong to. From health care to funeral services, this industry’s products cover you from cradle to grave and all the steps between.
Most service based businesses will do well in a recession. Those that supply personal hygiene solutions, like hairdressing, are especially well placed to thrive in a downturn. The reason is simple.
Even in a recession, hair salons and barbershops provide a service a large section of the population needs. It can be incredibly difficult to cut your own hair. Making a decent job, particularly of the back of your head, can be next to impossible. That’s why the skills of hairdressers will always be in high demand.
When a recession hits, business owners start looking for ways to reduce expenses and cut down on running costs. One of the first places they will turn for financial advice and guidance will be their accountants.
With in-depth knowledge of tax breaks, credits and deductible losses, an accountant is the sharpest tool in your business-running toolbox. Equipped with a treasure trove of helpful pointers for financial success, they can help any business develop a recession-busting plan. Creating the building blocks for continued success through the downturn and into a healthy financial future.
This ability makes accountants indispensable during a recession.
Recessions can be a negative experience. With the requirement to reduce overheads, many potential customers will cut back on non-essentials. Their focus firmly on what they need rather than what they would like, purchases are restricted to the necessities of life.
Life can be challenging without any treats, though. They will often splurge on small, reasonably priced luxuries to boost morale and cheer them up. If your business offers low priced gifts and treats, it’s a tried and tested recession buster. Couple the need for a treat with birthdays, Christmas, and anniversaries; you’re on to a winning combination.
The need for a pick-me-up isn’t reserved for just humans. Many pet owners will ensure their pets still get their regular pampering session at the groomers. Spending on beloved furry friends is a great way for pet owners to get a lift in the feel-good department. If Fido’s happy so are they.
It’s easy to think the first business to suffer in a recession would be luxury items. Nothing could be further from the truth. The fact is, if your business offers a product or service that helps your customers forget their worries, even for just an hour or two, it’s an essential purchase.
Provide treats at a recession beating price, and your business is already on the road to economic survival.
Repairs & Maintenance
The one thing most people try to avoid in a recession is replacing expensive equipment. It can be cheaper to repair and maintain existing items to make them last longer.
This is particularly true when it comes to vehicles. At a time when money is tight, thoughts of purchasing a brand new car or truck go out of the window. Instead, a make-do-and-mend attitude takes over. When that trusty pickup you’ve owned for years breaks down, wears out or stops working, your first port of call is the local auto repair shop.
Auto repairs are one of the top recession-busting businesses. Mainly because most drivers don’t know enough about the inner workings of motor vehicles to fix issues themselves. As long as people need transport to get from A-to-B, there will always be a need for auto mechanics.
It’s true to say; a successful business needs to have total focus on the needs of consumers. Starting a prosperous business in a period of economic strife, requires an understanding of what those needs are.
Once identified, those needs fall into two business categories. The first is providing support for tasks not easy for consumers to carry out themselves. The second, they are giving nourishment and contentment for both stomachs and well-being.
A startup business offering support and sustenance is sure to be on the right path to both endure and overcome the challenges faced in a recession.