Smart entrepreneurs can churn a profit even when the economy is down. Don’t believe us? Check out these business ideas that can boom even during the anticipated recession of 2023.
Are you looking to start a business in 2023? While that’s a splendid idea, you must be aware of the current economic environment before starting your journey. A smart business leader is a successful business leader, after all.
Due to rising costs, the Ukraine crisis, and the after-effects of the pandemic, USA witnessed its highest inflation in 40 years. Most economists predict this will only continue, leading to a recession in 2023. So, businesses must prepare for challenging times ahead.
No firm wants to experience a recessionary period. But a business must prepare to withstand a recession if the leaders want to avoid potential financial troubles. The silver lining is that certain industries are less affected by economic downturns. The most recession-proof companies are ones that people need - even in a volatile environment.
So, what does this mean for your entrepreneurial dream? To make a calculated decision, we help you uncover
The Federal Reserve has been fighting inflation by increasing its fund rates since 2022. And it will continue to do so until prices begin to decline. Their goal is to restrict inflation from persisting. Simultaneously, they want to ensure that supply and demand eventually reach a balance.
However, the economy loses money and slows down as federal rates rise. It becomes more difficult for businesses and individuals to borrow money. This, in turn, drives down demand and could lead to a recession.
The good news is that not every industry is vulnerable to a recession’s consequences. Consumers still must take care of their basic requirements. They will also spend on measures to safeguard themselves from disaster. Thus, businesses that thrive in a recession are the ones that cater to these needs.
Does this come as a surprise? People aren’t buying, so why are marketing efforts still being undertaken? As COVID-19 taught us, online marketing thrived during economic upheaval times. This is because, unlike traditional marketing, online marketing is more agile. They can instantly adapt to meet the economic trends of the time.
Companies prefer agencies, as they come with a diverse, adaptable team. It allows them to cut down on hiring an in-house team. Instead, they employ digital agencies at smaller budgets to fulfill the marketing requirements.
Many people stay home more frequently during a recession to reduce their expenses. It also means that they give more attention to their home improvement needs. Thus, plumbing, utilities, and painting, among other services, are businesses that thrive in a recession. Remember that many home repair jobs are essential - with or without a recession. And, since they require a particular level of expertise, homeowners are not likely to take it up on their own.
When money is tight, people often look for ways to reduce overhead. They are likely to invest in repairs or new units to bring down utility bills or high energy costs. Moreover, a leaky faucet or a faulty heater is an inconvenience that cannot be ignored. Hence, this will be a year-round business with continuous demand.
Renovation and remodeling saw peak sales, even during a pandemic-driven recession. The home improvement industry alone garnered $538 billion in 2021. And this number is set to grow to over $620 billion in 2025.
As more people are working from home, they are keen on upgrading their surroundings. Individuals are also less likely to invest in new homes during a financial crisis. Instead, homeowners will invest in remodeling their existing homes. They even might require the services of a renovation expert if they wish to downsize or sell their house.
When it comes to painting, there might be a significant decline in commercial work. But, comparatively, companies often find a continuous demand for residential home painting. Due to regular wear and tear, homeowners need painting maintenance or repair. Caulking, power washing, and wall repair are just some that your business can offer. This makes painting one of the best recession-proof business ideas.
Even with an impending recession, there is no time like the present to start a business in painting. And you can do it with the least amount of hassles when you partner with our team at Hoist. Irrespective of the economic situation, we help you set up your painting business in just 30 days. What’s more, we equip you with all the necessary tools to run your business - for a simple monthly subscription.
And that’s only to name a few. Learn more about what our experts have to offer to help bring your business dream to life.
Even in times of recession, everyone needs access to essential healthcare services. Healthcare firms will prosper, especially during tough times like pandemics and recessions. Everything from elderly home care to health and wellness will continue to see a spike in sales.
However, not all medical services are recession-proof business ideas. Only pressing issues take the lead. For instance, a recession may decrease demand for cosmetic operations. Ensure that you can fill that mandatory gap for customers to continue buying from you.
A company that sells software online would fare better during a downturn. Online software often decreases your dependency on fluctuating product pricing. It is because you don’t need components or shipping arrangements. Moreover, this type of business has a lower overhead than traditional businesses.
Your business’s recession resilience is influenced by the kind of software you sell. For example, the ongoing demand for SEO can be fulfilled by SEO SaaS enterprises. They assist clients in saving money on marketing services as well. In times of financial difficulty, businesses begin to cut down on several expenses. Marketing is one of them. Hence, they look for a more cost-effective alternative like a DIY SEO software.
Even in a recession, taxes are a given. The Internal Revenue Service (IRS) has, in the past, provided extensions. But entrepreneurs cannot expect extensive exemptions from reporting taxes during a recession. So, small businesses will continue to need bookkeeping services.
Many small business owners and individuals need help with bookkeeping. Yet, they might try to do it on their own during downsizing attempts. Without the proper expertise, records become disorganized, or taxes are submitted wrongly. This can incur expensive costs, tax penalties, or other financial risks.
So, they are advised to entrust a trained accountant to complete the work. This is where your business can tap into the demand. You can also offer additional support by identifying possible tax advantages. This can help them reduce the amount they owe, and they may return for repeat business.
Another venture that is a solid recession-proof small business idea is accounting firms. The truth is that when cash flow is limited, many will want accounting consulting. An accountant’s knowledge is essential to examine costs. They can offer advice on where a business should cut down. They also need to manage resources and guide owners in resolving financial issues.
Almost everything is available online for a lower cost in our digital world. So, even during a recession, consumers will continue to buy their essentials digitally. That means packages need to be delivered. This is why a courier service is a great recession-proof business idea.
Logistics industries are well-positioned and generally unfazed during a recession in the market. This is because:
This sector caters to a diversified pool of clients. They can be from business-to-business (BTB) and business-to-consumer (BTC) industries. Consumers must occasionally send items, whether for personal or professional reasons. Hence, regardless of financial state, courier services will continue to thrive.
Remember that every recession brings unique economic circumstances. It is challenging to predict how the next recession will affect particular industries. However, most recession-proof companies operate with little overhead costs. They further implement tactics like securing capital in advance or setting up an agile and well-engaged workforce.
To thrive amidst uncertainty, you must include risk-averse strategies in your venture. Start by recognizing the similarities among recession-proof business structures. Use your network and reach out to seasoned experts for guidance.
Or partner with trusted providers like Hoist to take your business to new heights. We provide business owners with the support and tools they need, especially in the painting field. So, if you are ready to start your business in 2023, reach out to our team today. We will help you start, run and grow your business, no matter the economic environment!
