- [Narrator] Starting a
business during a recession
can be an amazing opportunity
to build influence
when other businesses are
scared to make any moves.
These five recession-proof business ideas
have held fast through
tough economic times.
That being said, you can recession-proof
practically any business idea
by focusing on employee retention,
honing in your marketing,
and building a reserve of
liquid funds so you can make
big moves while other
businesses are struggling.
Sweet Treats.
Even though consumers cut
back on their spending
during times of economic hardship,
people still allow room in their budget
for what trend analysts
call, "Small indulgences."
Though it may surprise you,
businesses that deal with sweet treats,
like doughnuts and chocolates,
prosper during recessions.
A brief recession between 1990 and 1991
saw the sale of doughnuts
account for 15.7% of all bakery sales,
almost two percentage
points higher than in 1989.
Many treats became popular
during The Great Depression in the '30s.
Snickers were born, Little
Debbie hit the pavement,
and Krispy Kreme was founded on the sale
of thousands of yeasted doughnuts.
Years later, when America
faced the Great Recession,
candy manufacturers like Cadbury, Nestle,
and Hershey's yielded great profits.
And thanks to Nestle, the Toll House Inn
created the chocolate chip cookie.
Since chocolate boosts
serotonin and endorphin levels
in the brain, it's natural that people
turn to the sweet treat when
they're feeling anxious.
Cadbury's profits alone
increased by 30% in 2008.
If you're an entrepreneur
with a sweet tooth,
you may consider starting a
bakery or chocolate treat.
Put your treats above the rest
by getting international
with your recipes,
and create items that
are either gluten-free,
low sugar, or vegan.
The more options you provide
the larger your customer base.
Cleaning Services.
While residential cleaning
services often take a hit
during recessions,
commercial cleaning services
are always ticking along no
matter what the economy is like.
After all, a clean office is
a more productive workspace.
Even though this is a
competitive industry,
there's plenty of room for improvement.
Every year, the average cleaning company
loses up to 55% of their
clients due to poor service.
If you offer thorough,
high-quality services
and even something unique,
you have an excellent shot
at succeeding in this market.
Between 2007 and 2017, the
cleaning industry grew on average
at a rate of 6.6% each
year, and industry revenue
is predicted to increase
over the next five years.
Having upsell services are
a good way to cater to those
who want an approachable,
entry-level price,
while also finding more ways to increase
your bottom line and create cash reserves.
Grocery Stores.
Opening a grocery store is a
safe bet during a recession,
because as money gets tight,
more people cook their own meals
instead of going out to eat.
Spending at grocery
stores only dipped 1.6%
during the Great Recession,
while spending at restaurants
dropped by nearly 13%.
Grocery stores are known to flourish
during economic hardships because
of their essential nature.
Kroger hired 16,000 people in 2008,
and Trader Joe's started,
expanded, and evolved
through several different recessions.
Better yet, even when a
recession is not happening,
this business is still successful.
In the past five years,
the grocery store industry
has grown at a steady rate of 1.2%,
and that rate is
predicted to keep growing.
By focusing on employee satisfaction
and connecting with local food production,
you can boost retention
within your community.
Child Care.
People will always want their children
to have the best care,
which is why this industry
will stand the test of time.
If you don't want to start
your own entire child care business,
you can still find profitable ways
to support the people
who are in that industry,
or even support people who
homeschool their children.
The number of homeschooled children
has been increasing at
a steady rate each year.
Over five years starting in 2007,
there was an 18% increase
in the number of children
being homeschooled.
There are now over 2.5 million
students who learn from home.
Consider ways you can provide
supplies and resources
targeted at this evergrowing group.
Here's another segment
of the learning market.
Single mothers, and
subsequently their children,
get hit hard during recessions.
In 2009, single mothers of
children under the age of six
had an unemployment rate of 17.5%.
Providing support such as
affordable learning alternatives,
or ways to connect with reputable sitters,
will not only grow the economy,
but improve the childhoods
of future generations.
To boost your child care-based business,
consider offering subjects
that traditional schools
cannot or do not have.
Home economics, nature activities,
and communication workshops
can allow children
to exercise their brains while having fun.
Thrift Stores.
Resale and thrift stores
are one of the few types of
businesses that actually thrive
during times of economic uncertainty.
Since the Great Recession,
and even The Great Depression,
consumers have been trained
to hunt for the best deals.
This makes it hard for
big department stores
to compete with resale and thrift stores.
An August 2009 survey of
resale and thrift shops
concluded that 64.1% saw an
increase in sales from 2008.
ThredUP, an online clothing
consignment service,
is an amazing example of
a unique thrifty option
that sprung from economic hardship
during the last recession.
Half Price Books, a Dallas-based operation
that sells used books and magazines,
saw an increase in sales
to around $200 million through 2009.
There was also a rise
of 10% for total sales,
including the four new stores
they opened in 2008 alone.
The beauty of resale stores is that
they're so much more
available than clothes.
People also want to furnish
their homes and inexpensively
treat themselves to
games, books, and more.
People tend to lean
towards wallet-friendly,
DIY projects during economic hardships.
They look to resale stores
to fulfill those desires.
The transaction is twofold.
Customers enjoy recycling their old wares
and making a quick buck,
while the store itself
offers unique items at affordable prices.
Make your thrift store more inviting
by creating a boutique atmosphere,
and consider giving local artists
a place to sell their wares.
This list is just the tip of the iceberg.
Small businesses are the
lifeblood of every community.
We want you to be passionate
and prepared for a lifetime
of entrepreneurship.
If you're looking for more inspiration,
we made some free tools to generate ideas,
find a name, and form your business.
Find free resources and
guides at truic.com.
(calm music)
