- Business and Employment
Business Ideas for Tough Economic Times
When the economy takes a downturn, it feels like all we see are businesses closing and people losing their jobs. The outlook for small businesses takes on a dark and ominous tone as it is almost expected to fail. If the big businesses can't stay in business, with all their resources, how can a small business expect to survive?
The key to survival (and even success) isn't the size, but the business itself. There are many business models that survive and thrive in tough economic times. The key is knowing what those models are, and how to keep them going in hard times.
Small Business Ideas
Businesses that survive in down economies have a few things in common.
First, they don't cost a lot of money to run, so they can withstand lowered income if necessary. For example, an online business with low overhead has less to lose than a business that has a large building to maintain and lease. That's not to say that large, expensive businesses can't survive a tough economy, but they need to have the second factor also:
Second, they provide the type of product or service that people or businesses are still willing to pay for despite the downturn. For example, sales of luxury items such as expensive jewelry or vacations may decrease as people have to tighten their belts. But items such as groceries and services such as child care generally do not decrease. People need these regardless of the economy. So, businesses providing these resilient products or services tend to fare better in tough times.
Work at Home Businesses
In budget-conscious times, low overhead expenses are helpful to keeping small businesses successful. For this reason, a home based business is often a smart undertaking. Home based businesses can be built around products or services that people need despite tough times. Some examples are:
- Tutoring, teaching or other educational services
- Resume building or other job-search services
- Child care or babysitting
With little start-up expenses, you can have a solid business that will survive economic changes.
Find a Franchise
When looking for a solid business to weather the times, franchises are an excellent bet. A franchise is an opportunity to buy into a business model that belongs to someone else. You are responsible for running the business, but you gain a preset model to follow. In the US, most fast food chains are franchises, along with many small stores. Check out the links to the right for ways to find franchise opportunities.
The advantage to an established franchise is that you can follow methods and use products that have been tested in various business environments. The franchisor is there to help you make money because, ultimately, if you make money, so do they!
How to Stay in Business
Once you are up and running, how do you stay in business in a down economy? The answer is simple, and is comprised of three things:
First, listen! Pay attention to your customers and learn to assess their needs and wants. Make sure you continue to deliver exactly what they want, and make it great enough that they will spread the word.
Know your market. When the market changes, make sure you are ahead of the game. Look for trends and keep up with what is new and fresh. Stay connected through social media and networking so you always have an eye on what is trending.
Be flexible. Things can change in tough economic times. People no longer want to pay for certain things, but may be more desperate for others. Keep your business flexible so that you can be flexible to meet their changing needs.
Tough economic times can be scary to those with the entrepreneurial spirit. With the right business model and an eye on the market, small businesses can be successful no matter what the economy is doing. In her blog series The Recession is Bullhonkey, Michelle Ward (When I Grow Up Coach) shares stories of those who have beaten the odds and succeeded in business in a down economy. You too can beat the odds and start the right business for the times!