Starting a business during a recession may sound like however is doing it has lost their mind. But there are several exceptions to every rule. And while any business venture can be risky it would seem that starting one during a recession would be unlikely. Not true.
Trying to start a business during a recession is more like baptism by fire. But consider this, if you remain diligent enough and start a viable business during a recession as the economy recovers your business will begin to thrive.
So let’s take a look at some counter-cyclical or recession-proof businesses with explanations as to why they are the best businesses to start during a recession according to The Balance Small Business.
- Accounting Services. You wouldn’t think that a recession would be a good time to start an accounting service. But it is. Think about it this way, you would want to rely on somebody for good financial advice during tough times. People often turn to accountants as a sort of business advisor that can offer more confidence in handling financial affairs.
- Graphic Design Service. During a recession a lot of people lose their jobs and can’t find a new one. Since they can’t find a job people will start their own business. A recession brings out thousands of entrepreneurs. With every new business they will need to purchase a new logo, website and marketing material. This brings jobs to graphic designers and logo designers..
- Bulk Food Sales. When the going gets tough people often stock up on food items. Large quantities of staple items like flour, sugar, laundry soap, are in high demand when there is a likelihood of a shortage down the road.
- Affordable Luxury Items. This definitely sounds like a contradiction in terms, but think for a moment. When a recession rolls around the general public feels as if they are being deprived. A small retail that sells mid level luxury items as opposed to high end luxury items may be very prosperous. Like a travel agent that specializes in affordable yet luxurious specialty vacations.
- Debt Collection Agency. This one seems to be rather obvious but getting set up in this business and operating it from your home could be the ideal thing for you. And again as the economy recovers this business would flourish.
- Resume’ Writing Service. During a recession many people lose their jobs and unemployment skyrockets. All of these newcomers to the world of job hunting will be looking to fluff up that resume’ so there will be a high demand for experienced resume’ writers. Again a business that you can run from the comfort of home.
- Auto Repair Service. This business really does well during a recession. People will shy away from big ticket purchases such as buying a car. Then they also realize that fixing their present car is a lot cheaper than buying a new one. If you happen to be an unemployed auto mechanic your luck can turn around during a recession. It’s one of the best businesses you can start and even when the recession is over there will always be a high demand for a good mechanic.
- Home Staging Service. The home staging business has become a really good business to be in because it is extremely difficult to sell a house in a recession. But that is what a good home stager can do. They have methods and practices to make your home more appealing to prospective buyers. And if you just happen to be an interior decorator, this is a very good recession business to be in.
- Virtual Assistant. A virtual assistant didn’t exist till a few years ago so they are the new kid on the block. This a great recession business to be in when companies restructure their expensive administrative staff. And as a result they may outsource some of those jobs to save money. One good virtual assistant can cover many administrative jobs since all communication is done online or on phone. Virtual assistants are cheaper and just as effective as in house assistants. This business is virtually recession proof.
- Tutoring Services. This is another good recession business as many people go back to college to learn something new or to learn about new jobs that they haven’t ever worked in. So if you happen to be a good tutor your services could be in very high demand.during a recession. You can operate online or in person this also makes your business very versatile.
- Food Truck. If you happen to be in the idea of starting a food serving business but are scared of the startup costs, consider a food truck. With a food truck you don’t have the cost of a franchise or the purchase or rental of a sit down establishment. You can perhaps get a good deal on a used truck and outfit it to your menu. And in this time of social distancing your customer can eat away from each other in safety. If one location doesn’t work out, you have the option to drive to another one that may be more lucrative. The condition of our economy now has not stopped people from eating and food trucks are more popular than ever.
- Handyman Type Services. When a recession rolls around people tend to turn to repair services instead of purchasing new items. They just don’t have the money to splurge on something new when it can be fixed. Like patching a roof instead of replacing it. Appliance problems, or any number of things that really only require the right person with the right know how. This business requires virtually no startup unless you are going to need some new tools and you can be making cash quickly.
- Security Services. When the economy gets bad so does the crime rate. There are far more break ins and burglaries as people get frustrated from having no money. And even when times are good people such as home owners and owners of other properties will hire security guards to protect those valuable assets. Security type services are in high demand during recessions.
- Laundry Services. Even when the economy is bad people still want to look good and they will spend the money to do just that. A good laundry service is immune to economic hardships. Start up expense is very little. All you need is a washing machine and a dryer and be handy with a steam iron. And if business gets really good you may even need to hire an assistant.
The Take Away From All of This
One dread of every entrepreneur is a recession. It crushes start ups and turns a savvy entrepreneur into one with low morale and fear of any further business ventures. When a recession comes to town many people lose jobs and businesses close their doors forever as costs are trying to be cut.
The result is that job security is job one. That is why these out of work people tend to flock to some of the more recession proof business ideas. A recession proof business, as its name implies is one that can endure and thrive no matter what the economic landscape looks like.
And as always if you have the drive and the passion and the do or die mentality that it takes to be an entrepreneur and you can weather any storm, then you will be set for a booming business as the economy comes back to life. The economy is like a yo-yo, it always tends to bounce right back up.
A recession is a very tough time in a lot of areas. There are literally millions of people that suffer economically. But if you are the type of person that can take the bull by the horns then some of these types of businesses could be just the thing for you.
Economic conditions create different headwinds and tailwinds but it is impossible to be able to detect such factors as these. Timing is very critical and trying to determine the right time to launch your business may be a difficult thing to do. But leaning toward these types of businesses you may be that new kid that made it big when nobody else did.