One of the reasons many people are yet to start their home based business is they aren't sure is their idea will work. Some might have a list of niche small business ideas but not sure which one has the best chances of success. It's quite normal to want to reduce the risks involved in starting a business.
However, keeping your ideas on hold until you're sure could mean a missed opportunity. If you have a list of niche business ideas but still not sure which one to start, this guide will help you get started. It outlines the key factors you should consider before starting your new niche business.
The market size and competition
Niche markets consist of a small group within a larger market. Your business will only serve a percentage of this small group. Now, when considering the market size, you must be able to identify your desired customer profile.
That is, which people within your target market do you wish to work with. After identifying your desired customer, you should now consider how easy it will be to acquire them as your business' clients.
The customer acquisition process will involve identifying where your ideal customer is and marketing your business to them. If you find that customer acquisition is difficult and expensive, then the niche business idea might not be the best.
Many people fear competition. However, if you're getting into a niche business, a little competition might be necessary. Already existing businesses in your niche is an indication that there's money to be made there.
However, when assessing your competition, you should also be realistic when determining if you can beat them. Some of the ways to know if you can beat your competition are:
1. Your competitors aren't huge already established brands.
2. You have a unique selling point that gives you leverage over your competitors.
Ease of starting and running the niche small business
Many of the best niche small businesses are one man operations. Many start as sole proprietorship businesses where there aren't many startup requirements. If starting the business requires more than just your skills, your product or service; it means that you'll need to invest more capital to hire additional skills. This significantly increases startup costs which will slow down the business' growth.
Starting your niche small business is usually the easy part. Running it daily until it's successful is not so easy. Many small businesses fail because their owners didn't account for the costs and labor needed to run the business on a daily basis until it turns a profit. In most cases, the owners run out of startup capital before the business breaks even.
When assessing your niche small business ideas, give priority to those which don't demand huge running costs. Some of the features of businesses that are easy to start and run include the following:
- Low startup capital requirements
- The business turns a profit within a few days or weeks
- You can easily operate the business on your own
- You can outsource or automate some tasks as the business grows
Flexibility of the business idea
Existing or rising demand for a product or service is the main reason why small niche businesses are established. However, many of these businesses cease to exist when the demand dies out or shifts to a new product or service.
If you want to be truly successful, your small business idea should be able to evolve to cater for the changing demands in the market. Rather than build an entirely new business, your small niche business idea should be flexible such that your business can offer a specific product or service to your target market when they need it.
This way, your business is able to grow by satisfying the needs of already existing customers rather than venturing into entirely new markets. This will save you the cost of acquiring new customers and, will help to enhance customer loyalty to your business.
Some of the ways to identify whether your niche business idea is flexible include:
- Your target market has other needs which can be satisfied a product or service closely related to what you currently offer. For example, if your small business currently offers web design services for people who create and sell information products, other related products your business can offer include copy writing services for their information products.
- The business idea provides the opportunity to partner with other businesses. Your business idea is only great to the point where it can satisfy your target audience's needs. If the needs aren't met, your customer will move to your competition.
However, if your business idea accommodates teaming up with other businesses even if they're your competition, you will be able to retain your current customers, sell to your partner's customers and still make profit.
3 examples of niche small business ideas
Digital product creation
Many of the niche businesses are based on the time for money model where you're paid for the amount of time you spend on the job. Digital product creation moves away from this model where you're paid for your product which can be sold regardless of whether you're working or not. A digital product can take various forms including ebooks and software.
If you have a skill, freelancing can make a great niche business to start from home. Almost every skill can be sold on a freelance basis. There are millions of freelancers to compete with. Therefore, to stand out, you'll need to focus on a specific niche market that's willing to pay for your service. For example, if you're a technical writer, you can focus on the glass products manufacturers niche rather than write for every other company that needs technical writers.
If you have expert knowledge people are seeking, you can start a consulting business. Like with the previous two business ideas, finding a small niche to work in will increase your chances of success.
Having the right niche small business idea can mean the difference between starting a successful business or not. If you have a list of business ideas you want to try out, running each through the checklist discussed above will give you a better picture about which will work or not.
Are you on lookout for a viable business idea? Are you trying to efficiently figure out just what sort of business you can profitable launch? Well, if this is the case, you are not alone. According to reports by the US census and SBA, Americans are launching hundreds of thousands business each and every year.
However, most of these people do not really have as fixed set idea on what they can actually do best. So, maybe you have being laid off, and are unwilling to work for someone else again. Maybe you have gotten fed up of your nagging boss or even colleagues. On the other hand, perhaps you deeply believe you can be able to make more on your own than working for someone.
Whatever might be your driving motivation, running your own show can prove to be extremely rewarding both financially and personally. But there is a catch to this. All this can happen if you first hit upon an excellent business idea.
So, what kind of business idea should you settle for? Well, the answer to this question is the idea that is as individual as yourself. Still, for it to be a perfect business ideal, and have a good chance of been profitable, it ought to, generally speaking, adhere to the guidelines below.
To begin with, it should be about something you understand how to do pretty well. Secondly, it should be about something you are fond of doing, and would not mind doing day in day out. Thirdly, it should be about something that can be able to generate a sufficiently broad based appeal to let you sell it in a consistent manner. Finally, it ought to be about something you can sell at a price, which can cover all your overheads and still leave you with a good profit.
As such, here then are a few viable niche small business ideas that you might like to look into, if you wish to turn into a highly successful entrepreneur. It is very important to note that all of them have been painstakingly picked based on a number of critical factors. These are the projected growth rate of the respective niches they represent, the barriers of entry they present, and lastly the potential earnings you can realize.
1. Food truck business
The food truck business sector has been growing very rapidly. For instance, in the year 2015, its overall revenue stood at a respectable $1.2 billion. This represents a 12.4% increase for the previous 5 years. Market forecasts now project this growth rate will start slowing down, but remain constant at 3.7% to 1.7 billion over the next 5 years. The food truck business can be perfect for those who have gastronomic business ideas, but have very little risk tolerance. In essence, setting up a food truck business, in this particular context, is much more practical than setting up a restaurant. First of all, it will require a substantially lesser capital to launch. Also, the failure rates of these businesses is much lower than those of restaurants, varying between 10% -20% as opposed to the 60% - 90% of the latter.
2. Remote employee monitoring
The workforce of the US is rapidly evolving into a remote based one. Therefore, those industries which can effectively promote this given trend are now primed to be very lucrative in the foreseeable future. By the year 2020, the American remote workers population will stand at an estimated 105.4 million. Still, most bosses will want to stand over the shoulders of their employees’ so to speak, even if this can only be done in a virtual way. In turn, this will lead to a major boom in the remote employee monitoring industry. So, this can be one the very best niche small business ideas you could decide to settle for.
3. Translation and language services
The ever growing demand for cross lingual communication, all over the globe, has been able to generate fantastic business opportunities. This is especially the case when it comes to those who are in a good position to offer excellent translation services. The translation and languages services sector has been projected to experience a remarkable growth rate of 46% in just the next 15 years. For your information, this is a much faster growth rate than that of all the other sectors when put together. Should you have a talent for languages or can launch a business, which can connect multilingual persons with clients, you will be able to capitalize on this trend.
4. Healthy vending machine business
The healthy vending machine industry is now a $42 billion affair, and yet another viable small business idea you might like to look into. For example, with an investment of between $30,000 and $225,000, you can be able to buy into a healthy vending machine franchise. This business has the full backing of the powers that be too. Therefore, it is definitely primed to grow exponentially in the next few years. Additionally, another plus in the favor of the healthy vending machine business is that the income you can make is almost completely passive in nature.
5. Green living
The green way of life has, over the few recent years, become very trendy with a variety of environmentally conscious individuals. To which end, many are now opting to use those building materials that have been designed to greatly minimize the pollution of our planet. This has, in turn, created a fledging green industry, which can be one of the most feasible niche small business ideas you might like to settle for, if you do not know where to start.
This growing consumer interest in energy efficient products has gone on generate an explosive growth in this particular industry. For instance, the sustainable building materials sector is now a respectable $36 million affair. At the same time, market forecasts have predicted that this industry will grow at a steady rate of 10.6% each and every year up to the year 2020. So, starting a business that deals in these products or their installation can be a good idea if you wish to run your own show.
Well, there you have it! By opting for any of these ideas, you can be able to evolve into a highly successful entrepreneur in an effortless and markedly stress-free manner.