Many prospective small business owners are terrified of putting their heart and soul in their business only for it to not make enough profits to continue (or be worth continuing). This is a very valid concern and will largely depend on many factors. However, for those who have not already chosen an industry, it can be very worthwhile to understand what types of businesses tend to be more profitable. Keep in mind that profitable does not mean you will be a millionaire in no time, it simply means that these type of businesses tend to earn the most profits relative to the rate of investment required to get them up and running. Below are just three examples of real businesses in profitable industries that you can look to in order to get an idea of how each business can become profitable.
JD&C Tax Preparation
One business that is constantly in demand and very profitable is tax preparation and accounting services. Although tax preparation is a seasonal business, it can be very profitable due to high demand. Leticia Michel created JD&C as a way for her to make a living while being able to have enough time to spend with her children every day. She rented an old flower shop in Boyle Heights, CA and converted it to her very own tax preparation service. Leticia started small by doing tax preparation for a few individual clients but has since grown her business to include personal and business tax preparation, notary services, accounting services, bookkeeping, tax audits, IRS audit assistance, property tax appeals, incorporation, business formation, and debt relief. If you have experience in accounting or tax preparation you could very easily fill a niche that is always high in demand and usually well worth the initial rate of investment. It is even more profitable if you expand your business to cover more than just tax preparation as JD&C has done. That way you can cover some of the slower tax preparation periods with other services.
The food truck industry has exploded in the past couple of years and considering the relatively low required investment many food truck businesses have become very profitable. One such business is Seoul Taco, a food truck founded by David Choi in St. Louis, MO. Choi was working two to three minimum wage jobs after graduating college, and he wanted something more. Choi searched online for food trucks for sale and ended up talking a seller into selling him a 14-foot food truck for a mere $18,000 (his personal savings). Choi had already seen a lack of Korean options in the St. Louis area, and also noticed that Mexican restaurants were growing rapidly. This gave him the idea to combine his family’s Korean recipes with a Mexican flair, and led to the creation of his signature Korean tacos. Choi sourced his traditional Korean ingredients from local Korean supermarkets and bought the rest of his ingredients from Sam’s Club. All Choi had to do was talk to his city officials to learn the regulations on where food trucks could serve, and his business was up and running. In just a few years Seoul Taco grew from one 14 foot truck to a number of small chain restaurants and food trucks across Missouri. While the food truck industry can be hard work and requires a great brand, it can become immensely profitable due to its low initial investment requirements and high demand (especially for food trucks filling a niche market).
Top Shop Automotive
Automotive maintenance and repair is an industry that is constantly in demand, especially with how integral a person’s car can be in terms of getting to work, travelling, social events, etc. Willie Contreras took his love for Volkswagen vehicles and turned it into a small business by opening Top Shop Automotive. Contreras thrived due to renting out one of his bays to another experienced mechanic, Pat Roell, a master technician on a number of foreign cars other than Volkswagens. Contreras would refer customers with foreign cars to Roell, while Roell would refer any customers with Volkswagens to Contreras. Eventually, the master mechanic that Willie Contreras apprenticed under, Hans Loesch, offered to sell Contreras his bigger shop space once he retired. Contreras has since grown Top Shop Automotive to serve an ever-expanding customer base. Top Shop Automotive was successful due to a clean and inviting office, building quality relationships with customers, and hiring knowledgeable staff that can provide top-notch service to customers. Opening an automotive repair shop can be a bit pricey, however, there is a great opportunity for knowledgeable technicians that have built a strong network to start a business that can become incredibly profitable in just a few years.
The Sky’s The Limit
While the three industries above are great starting points for small business owners, there are a wide variety of booming industries that have seen many small business owners achieve great profitability in a limited time. To get inspired and get a complete list of the most profitable industries nowadays, be sure to read here about the 30 Most Profitable Small Businesses.