The best recession business ideas are those that focus on sectors where demand remains relatively constant even in difficult economic times or on sectors that actually expand during the course of a recession. Beginning a business during a recession is difficult, but any business that provides a product or service that is very hard to do without, such as gasoline or funereal services, is a good bet. Other businesses focus on providing goods that are in greater demand during tough economic times than in good years, such as inexpensive alternatives to high-end products. An additional category of recession business ideas emphasizes providing specialized goods or services that are needed because of a recession, such as job training or the upkeep of empty properties.
Economists have noted that demand for certain goods and services does not change much in response to changing economic conditions. Consumers can cut back on spending for energy or insurance but cannot entirely eliminate these expenses. Similarly, medical care spending does not always decline during a recession, especially in markets with good insurance coverage, where people can afford to meet co-payments and seek care. Recession business ideas that focus on providing these crucial services may be better bets.
The economic impact of a recession is not always evenly distributed. In cases where certain segments of the economy or certain regions have been more badly damaged than others, the specific location of a potential business is crucial. Recession business ideas that target the economically vibrant parts of a nation, such as the wealthy suburbs of New York or states with thriving energy economies are better than those that target populations hit hard by a recent loss of manufacturing facilities.
In areas where a recession has hit, some demand does persist. Consumers will tend to substitute less-expensive goods for more expensive goods, while still meeting their basic needs. A business can benefit from this tendency by providing inexpensive substitute goods. Less-expensive restaurants may see trade pick up, while pricier establishments lose patrons. Stores that sell inexpensive generic products may do better than those that sell name-brand products. Marketing a business as providing good value may aid in capitalizing on this trend.
Some new economic opportunities emerge as a result of a recession. ]In areas with a high rate of home foreclosure, properties may be owned by banks or other agencies, and these agencies will need to care for such properties and perhaps to perform limited repairs in order to prepare them for sale. Several recession business ideas focus on this type of work. The educational sector, too, often expands during periods of recession as men and women seek new job skills, and owning a business that provides job training can lead to profits during a recession.
