Though the consensus has felt the way it is the last few months, the world is officially in an economic recession. People might ask others, “Do you start a business? You mean, starting one in a recession?” In the current environment we’re living in, I believe it feels more like a depression considering the severe economic problems. But as of last week, the United States and the rest of the world are now recession territories.
Some are calling it the Great Shutdown or the Great Lockdown. Yes, there’s an ongoing pandemic that’s caused problems; however, governments have created more significant problems despite the epidemic. The US economy was already a house of cards before the epidemic developed. It got worse not because of the pandemic but despite it. Governments around the world have turned it into a crisis, and the responses have been atrocious regarding stay-at-home orders and social distancing.
Do you start a business? Is it best to do it in bad times?
With the problems going on in the last few months, who knows how long the recession will last. Whether it’s months or a few years remains up in the air. With the uncertainty people are going through, starting a business might be the last thing on their minds.
In difficult times such as right now, it might not make sense. But I’ve come to believe the opposite is more authentic. In times of adversity, some people will take advantage of opportunities that can turn into fortunes over time.
It held during the Great Depression (the 1930s) and the Great Recession (2007-2009) when new businesses started up. Companies such as Uber and Airbnb began during the last recession over a decade ago. Who knows what will come about during this current recession.
For the rest of this post, I will go over some things to keep in mind when starting a business. Particularly when it comes during bad times, there are some things to make a note of, including:
1.) Businesses in high demand and low demand
2.) Brick & mortar vs eCommerce: eCommerce wins big
3.) Delivery and pickup services on the rise
4.) Online businesses as the best route
Do you start a business?
High demand or low demand?
When it comes to businesses in high demand, there are plenty of opportunities you can run into. Whether it’s food delivery or health care services, they can be accessible routes to start a business in a recession right now. The downside can be a lot of competition, so you’ll have to work extra hard to stand out at the top. Especially when it comes to food delivery services, you have to make sure you provide the best services possible.
Business opportunities not in high demand
With what we’re facing today, it’s worthwhile looking into starting a business in low demand. Sure, you may not see results right away, but you can build the groundwork to turn it profitable in the long run.
For example, owning a restaurant sounds impossible in today’s economic environment. But you can go in a different direction in how restaurants might operate in a post-pandemic period, besides delivery and pickup options, who knows how restaurants will work while still thriving in the future. So starting a restaurant in a non-traditional approach could be something to look into.
eCommerce winning over brick & mortar businesses
Brick and mortar businesses (physical locations) have declined in the last decade. More so, they’ve had a rude awakening with the ongoing pandemic in the previous few months. Many stores closed temporarily, while others have closed permanently. JCPenney, a major retailer, has closed a lot of stores and recently filed for Chapter 11 Bankruptcy. Other retailers have followed suit in response to the current pandemic.
While brick and mortar stores have struggled lately, eCommerce has done very well in recent years. Especially in the last few months, eCommerce has grown exponentially with more people shopping online. The trends in online shopping will continue to grow and remain steady for some time. If you’re looking into starting an eCommerce store, it can be a great option to look into it during a recession.
Rise of delivery and pickup services
They’ve been around the last several years, but delivery and pickup services are becoming more popular these days. Besides traditional delivery service, there are more delivery options for groceries and other types of goods. Services such as UberEats, Grubhub, and Instacart have been around for some time. In the last few months, more people have taken advantage of these delivery services while staying at home. With the current trends, these services will continue to remain accessible for the time being.
Online businesses the best route: (Also, the most exciting and lucrative)
An online business route is one of the most accessible paths to starting a business. Unlike with starting an offline business, you don’t need to go to a bank, submit a business proposal, and apply for business loans. That’s the traditional route of starting a business, especially with all the paperwork you have to go through.
In the online world, you can get a website set up in less than a half-hour and start building it out today. The costs are meager compared to starting a brick and mortar business, and fewer hurdles to overcome. Also, it can be lucrative and profitable in the long run.
Keep in mind it’s not easy as 1-2-3 to set up an online business in one day. As with any business venture (online or offline), it takes time and hard work to build a profitable, stable business. But whatever model you go into, the potential of making money is significant in the long run. Whether that’s affiliate marketing, eCommerce, informational marketing, or network marketing, there is much potential in any of these areas. These are the right places to run successful online businesses for years to come.
Overall, starting a business during a recession can be tricky for some people. But as I said early, it’s one of the best times to start a business when you’re hungry for new opportunities. Sure, you may have some growing pains in the beginning. However, that’s normal when going through the beginning stages.
What matters more is it can turn into something more prominent in a matter of months or a few years. If you’re willing to sacrifice and go through some hurdles, you could end up much better than you are today. Ultimately, it’s up to you on how far you want to take your business to the next level.
Simply put, we live in difficult times. Sure, it might not sound right to start a business venture now. But if you have a passion or want to put an idea into action, no need to hesitate or pull back. In bad times, you have to push yourself further and take action.
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