By Cindy Flanders, Partner, The Profitable Idea LLC
Before we think about starting a business with the current gloom and doom of most economists, let’s fully understand what a recession is: “ 2 consecutive quarters of negative growth in the gross domestic product (GDP)”
Deciding if we have a “soft” or “hard” landing is a topic for another day. For now, let’s focus on what types of businesses may actually do well in a recession. Think need to have vs. want to have. Unless of course, the want to have is a vice, since cigarettes and alcohol actually fare pretty well when the economy isn’t. Thinking of opening a brewery? Now might be a good time.
So other than vices, what do most people need, no matter what?
Childcare: You might be thinking that with so much remote work, the need for childcare has gone down. But having coached many people with children at home, I see it’s impossible to work without child care. They either have someone come into their home or drop them at daycare. It’s a need that will likely never go away.
Repair Services: When you can no longer afford that new car or appliance, what will you do? Auto repair shops thrive in a recession. Before buying that new $3,000 refrigerator, you’ll probably see if it can be repaired.
Grocery/Food stores: Is there any greater need than food? You may find yourself shopping more at discount stores like Walmart or Aldi, but you still gotta eat! And most people still pick up prepared food or dine out because of their busy schedules. Affordable eating concepts are still needed to fill in for those lost in the pandemic.
Accounting/tax services: Last time I checked, the IRS did not give us a pass on paying our taxes in the last recession. So don’t look for any leeway in this next one. In fact, spending some extra money to determine if you can take advantage of tax credits may be well worth it.
Healthcare services/providers: Sadly, your body does not know there’s a recession. There will always be a need for healthcare. In fact, home health care is expected to grow at 21% over the next decade. So if you’re thinking of starting a growth business in a recession and you have the expertise, this might be just the thing.
There are many other businesses that can thrive in bad economic times. If you’re in doubt as to what you might want to start, just think- what do people need, no matter what? And contact us for a list of recession-proof industries for your business ideas.
Amanda Weathersby, and Cynthia Flanders are Co-Leaders for the Profitable Idea LLC, which is now online!
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