I don’t want to be an alarmist, but even the most stable economy can face “lean times”. The whole world navigates great uncertainties on this issue today. However, there are types of businesses that do not go broke in a crisis.
The truth is that true entrepreneurs do not let fear of changing economic situations stop them. However, they must be more careful in choosing the types of steady consumer businesses that tend to be more resilient to financial shocks during a recession.
10 types of businesses that will not go broke in a crisis
Most of the companies built around beer and wine stand up well in times of crisis. The more expensive drinks tend to suffer, but the medium priced liquors remain.
This is due to a basic principle: people don’t kick a real habit just because the outlook has become gloomy. They simply adapt. That is, if they really like it, they will continue to watch football with a cold beer. Consider a liquor store or a distributorship.
It’s much easier to get into the beauty industry than into the alcohol industry. When the going gets tough, putting on makeup and moving on can encourage many people. No matter what the reason, cosmetics stand up well to recessions. There are many ways to get into the business, from distributing by catalog (like Mary Kay) to selling on the Internet.
3. Movie Theaters
Movie tickets usually thrive on hard times. It’s hard to compete with the big chains because they have the rights to the major releases, but why not consider a cinema that specializes in independent films and takes advantage of the trend to combine films with dinners? This can be successful in a small location.
4. Health Care
It’s a very difficult industry to get into. However, it is also true that the Baby Boomer generation is close to retirement and may be a growing market. Look for fresh ideas, but don’t forget to stick to your country’s health laws.
5. Specialty Food Stores
Today there are many food trends and specialty boutique food stores can become very popular in certain markets. For example, you can create a line of vegan products and sell them online with home delivery.
6. Candy and Desserts
In the same way that people don’t stop drinking because there is an economic crisis, they don’t stop eating. A few years ago, when the U.S. was in a sharp economic downturn, the cupcake craze was firmly established. You can combine this idea with the previous one and try with sugar-free, vegan or gluten-free desserts.
7. Repair shops
When there are “skinny cows” we don’t buy new microwave ovens, refrigerators or cars, we repair the ones we already have. Check out what’s in your local market that’s not covered.
8. Thrift shops
Just as you don’t buy new things during recessions, many people visit thrift stores looking for bargains. You can look for offers or even specialize in retro items.
9. Funeral Services
Funeral services are requested even in the worst financial times. Even in the worst economic crises, two things are certain: death and taxes. That said…
10. Tax Services
Good accountants know how to handle difficult circumstances. In these times, people seek to conserve every peso they can, while the Treasury seeks to maintain order in taxes. This creates ideal conditions for tax advisory services.
1. The economies of different countries move at different speeds: although the picture is complex for all countries, there are some that are growing and others that are not.
With its limitations, it is a fact that the United States is growing, so some of its northern trading partners have support and momentum
2. The institutional organization of different countries is also uneven: some countries have stronger and more stable institutions, which makes them more secure legally and commercially: Chile, Colombia, Mexico, Peru, among others, are still more predictable than Venezuela, Argentina or Brazil (with their current political instability).
3. It is necessary to be attentive to the reforms that are being developed: to face the new challenges and since they cannot continue to depend on one or a few export products, the different countries are betting on the diversification of their economies.
One of the fields of investment is infrastructure, as they need to improve their connectivity to compete in the world market. One alternative is to target businesses that are linked to these growing fields: there is a willingness to invest resources there.
Other measures that are being widely implemented are tax reforms so that more people and businesses pay taxes based on their income. You have to be aware of these changes to protect your money and your company’s money by getting accounting advice.
Some advice for entrepreneurs
It is likely that many businesses will be crippled only by the arrival of a financial crisis, so entrepreneurs and business people are advised to take some measures:
The first thing is to get paid.
“This is the year you become profitable or you become employed; you will not be able to have a business if you do not get paid, if you do not have money flow”.
- Raise what you can of investment assuming that you will not be able to later.
“Plan for 24 months at 50% sales at best: it is important to have a plan for the company to survive, and if you survive, you will be one of the most powerful companies,” he says.
The example is in those that were born during a crisis, such as Airbnb, Google, Uber, Facebook and Amazon.
Kill the experiments.
- “If you have experiments you’re running, like new untested business models, it’s time to kill them and focus exclusively on what generates you income.
- Have a theory of which business models will live and which will die.
That way it’s much easier for you to invest your time and money in the right models, such as online education, teleconferencing, telemedicine, remote job offers and the digital economy, among others, because, according to Vega, “if a crisis is coming in the middle of the coronavirus, coworkers, tourism, the luxury industry, entertainment, etc., would be affected.
In conclusion, to overcome a crisis, the most important thing is to take the attitude as if you were not in it; that is to say, to take the attitude of a warrior who is training to grow, and, that everything that is happening is a simple training.
This type of mental set creates an ideal energy context for you to overcome obstacles and release new alternatives, situations and opportunities for the crisis to turn on your side.
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