Anytime you launch a new business, there is some risk. Add a global pandemic and recession into the mix, and you may think that it’s business suicide. However: we’re here to tell you that now is as good a time as any, and for the right businesses, it’s the perfect time.
Starting a business during a recession will be a little scary, but believe it or not, you are not the first. It happens all of the time. Some of the world’s largest and most profitable businesses started during recessions. Microsoft, Disney, Trader Joe’s, IBM, and General Motors all launched during a recession, and they’ve done pretty well for themselves, no?
Many companies will lay off employees during a recession, but those employees’ tasks still exist and need to be accomplished. Why, then, would they let them go?
Well, the answer can be a lot of different reasons, though often it is because they can save a lot of money doing it. There’s no need to pay for an office, the existing offices can be reduced in size and amenities (fewer bathrooms, breakroom, etc), meaning a reduction in rent. They may move the whole office to another part of town where the overall costs are cheaper. Fewer full-time employees means fewer benefits to pay out.
The biggest factor in the success or failure of your business is YOU.
So who performs the tasks that still need to be accomplished? The answer is virtual assistants and online service contractors. You can split up an employee’s responsibilities into smaller tasks and hire them out to remote workers. Remote workers LIKE YOU. Starting a business during a recession can actually be highly successful and highly profitable, given you put the work into it.
There are some things to consider if you’re starting a business during a recession, but they’re not all so different from what you would want to consider anyways. Many of the questions you would ask yourself are similar, recession or no:
- What do I want to do?
- What skills do I have/what am I good at?
- What does the world need right now?
While the first two may reveal the same answers regardless of the economy, the third one will likely vary. It’s helpful to know some facts about spending habits during recessions, too, but remember that overall, recessions come and go. The economy is a living breathing thing, and sometimes it pauses or contracts for a bit. If you have a passion for your work and work hard, a recession does not have to mean business death.
Some businesses thrive and others dive, but remember that many of the niches that a virtual assistant would take on are needed in both categories.
If you work at your business the same way you work at anything you have great passion for, you’ve got an amazing shot at success, recession or not.
Which businesses thrive?
Essential services are the quickest and easiest answer. Businesses that you need regardless of the economy. For example, you have to eat. Grocery stores and suppliers and their peripheral businesses do very well.
Ditto home repair. Families might put the expensive vacation on hold but they’ll put a smaller amount of money into something that might give them a better return like refinishing a bathroom or kitchen. Instead of buying a new car, they might wire and finish the basement of their house.
Which ones struggle?
Non-essential items and services tend to suffer during a recession. Fashion retail slows way down. Luxury goods such as jewelry, watches, etc, as well. As you can imagine, during a recession that extravagance spending tends to drop off. Chances are good that if one of these businesses seems like the one to hitch your virtual assistant wagon to, it will be tough to find a market opportunity there during a recession.
The You factor
Never forget that the biggest factor in the success or failure of a business is YOU!! You need to be willing to put in the effort and the elbow grease that is required.
To be your own boss, you need to act like it. There is no one who will love your business and work harder for you than yourself, and you owe it to yourself to show your business its due respect. If you work at your business the same way you work at anything you have a great passion for, you’ve got an amazing shot at success, recession or not.
Matthew Ogden is a Minneapolis-based copywriter and content writer and editor. He’s written for national retailers and lobster roll companies alike. When not writing he can be found nose deep in a book, writing and performing music, or nerding out about guitar tone.