People feel the need to treat themselves in times of recession by changing their hair, and they need a hair cut every now and then. Also, people make various chocolate desserts at home no matter how hard the times are. The chocolate business will keep running and earning even in the recession period.
For a business to survive a recession, it needs strong leadership, an excellent product or service, attentive customer care and a handle on industry trends. Grocery and convenience stores, food and beverage manufacturers, and food delivery services are great businesses to start because they’re highly profitable. Everyone needs food and drinks, whether it’s picking up items from the grocery store for the week or going out for a quick meal. Food delivery has also become popular with more people working from home and having busier schedules. Why do companies invest in technology during a recession when money is tight? Economists theorize that it’s because their opportunity cost is lower than it would be in good times. When the economy is in great shape, a company has every incentive to produce as much as it can; if it diverts resources to invest in new technologies, it may be leaving money on the table.
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Even when finances are tight, if people are unwell, they will always seek a medical professional. This is why the healthcare industry can be said to be recession-proof — because of its price inelasticity. Much like business owners, investors and wealthy individuals want to secure their wealth and confirm that they’re well taken care of during the worst times.
Rather than full-time staff, companies often hire high-quality freelance workers to meet their design and marketing needs remotely. Home improvement and contracting is one of the most resilient industries, with a valuation of $457 billion in a year. Suffice to say, most people want access to repair, plumbing and pressure washing services as soon as possible, rather than wait for better economic conditions.
Growing a Business
Here are three more recession proof business ideas in the retail sector. The food and beverage industry is one of the most recession proof industries due to the fact that everyone still needs food and drinks to live. It is not a luxury that can be put aside during difficult times, so businesses in this sector can continue to do well even during a recession. Businesses in the home improvement contracting, auto repair, childcare and accounting industries do well in a recession. Suffice to say, most consumers deem these services as essential and will keep spending their money on them, rather than wait for better economic conditions. Online reselling of luxury bags, clothes, and accessories is common during an economic downturn. Thanks to eBay, Poshmark and thredUP, it’s easy for anyone to resell items online and ship the products to consumers.
- Also, people make various chocolate desserts at home no matter how hard the times are.
- As customers reduce their spending, the number of product orders decreases.
- Investors should consider engaging a qualified financial and/or tax professional to determine a suitable investment strategy.
- In France, 4% of workers and 1% of firms took advantage of short-time work programs in 2009, and the program paid off for both workers and companies.
- But a recent study by Christos Makridis and Maury Gittleman (of the U.S. Bureau of Labor Statistics) documents an important fact.
You can also switch your focus to businesses as your primary clients. This is an excellent choice for hotels since people may still travel for work even if not for vacation.
Healthcare Services and Providers
Regardless of what products or services a business sells, the keys to weathering a recession are agility and adaptability. Technology usage doesn’t decrease dramatically during a recession. In fact, during the COVID-19 recession, IT professionals were even more in demand as companies had to determine solutions and vet technology for work-from-home and remote-office models. When major technical issues occur, it can bring work to a stop, something businesses want to avoid in an already tense financial time. IT support ensures that everyone can get as much work done as possible without technology being a constraint. Melissa King Melissa King is a freelance writer who helps B2B SaaS companies spread the word about their products through engaging content.
The SaaS market has grown at insane speeds over the past ten years and isn’t likely to slow down. Software as a service is delivered via the internet rather than installing complicated software and hardware. As a cloud-based service, the ease, scalability, and security are high, and users typically pay a monthly recession proof business or yearly fee. Business consulting includes a broad range of professional services other companies need help with, such as strategy, market research, or public relations. Consultants or consulting firms are meant to help their clients by solving specific problems or issues, often saving them money.
Recession-Proof Business Ideas for Every Startup Budget
By contrast, businesses that use flexible work find themselves in a more advantageous position. These businesses fill out their workforces using online apps like Upwork, Toptal and Instawork, adapting in real-time to changing needs of staff. They can also keep rosters on their apps of the workers who have already received any necessary training and offer the best fit for their workplaces. Government agencies and many private organizations rely on the National Bureau of Economic Research , a not-for-profit research institute, to label recessions for official statistics.
- Absent the subsidies, they most likely would have had to lay off more employees, making it more difficult to recover after the recession or causing them to go out of business altogether.
- When it comes to staying agile and managing cash flow efficiently, NetSuite Financial Management software has every tool your business needs in a single application.
- In times of uncertainty, people wish to keep things longer rather than buy new replacements.
- But the uncertainty of a recession necessitates experimentation, which requires that decisions be made throughout the organization.
- You won’t need to build your website- you can just buy one that’s already established on sites like Shopify or BigCommerce.
- Is a writer for Clever Girl Finance and a financial journalist who helps people understand the complex world of investing.
Major companies in this sector include Colgate-Palmolive Company , Proctor & Gamble Co , and Unilever N.V. If you look at the manufacturer of many items in your home, you will find these companies. They each own dozens of major brands that are sold almost everywhere in the world. The offers that appear in this table are from partnerships from which Investopedia receives compensation. Investopedia does not include all offers available in the marketplace.
That’s why it’s important to consider businesses and industries that are recession proof. While many people make adjustments to their spending during a recession, spending on their children is not where they tend make the sacrifices. Historically, products for babies continue to sell well during economic downturns as families look to reduce spending in other areas. Would we recommend opening a restaurant, cafe, or bar in the midst of the COVID-19 pandemic?
In addition, many of these software are fully integrated into business processes, so companies can’t afford to ditch them during a recession. 2022 has been the year of real estate, fueling the home improvement industry as well. As home values go up, it creates excess funds for improving homes for many families. Plus, as homes start to age, they will need to be updated and repaired to maintain value. Because of that, investors should construct truly diversified portfolios to weather the downturns.
He chalks up its success to its focus on careers because it helped members get advice, find work, and develop skills during a difficult economic time. Once the economy stabilized, he could then appeal to the other side of the market—businesses looking for talent—through https://www.bookstime.com/ a job board and freelance marketplace. Accounting services are another sector that will be in demand even when times get tough. In fact, they might be in even more demand during a recession as businesses use their services to find ways to cut down on costs.
- However, you don’t need special training or qualifications to be a groomer, and you can partner with a manufacturer if you want to make pet food.
- Auto repair services are one of the best business ideas for making money in a recession.
- Most often, these are not high-end luxury items that people can live without, which makes serving this segment of the food and beverage industry an especially attractive business idea.
- That number, published by the American Pet Products Association, was an increase of 6.7% on the 2019 figures.
- Becoming a virtual assistant can be ideal during a recession — especially if you secure clients who might not be that affected by an economic crisis.
- Starting this kind of business opens up many opportunities which will still be there during a recession.