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Since mid-2020, the number of new businesses formed in the U.S. has remained higher than in the previous decade. High levels of unemployment, improved competence with technology and simplified e-commerce and website creation services are considered significant factors among many others. In short, now is the best time to consider planning out profitable small business ideas. Here are 10 of the most profitable ones.
What To Consider Before Launching a Small Business?
The U.S. Small Business Administration defines a small business as an independent entity that has fewer than 500 employees. Anyone interested in launching a small business should consider the structure it’ll operate — or how it will be legally organized. The most common business structures are:
- Sole proprietorships
- Limited liability companies
Choosing the proper structure is important because a company’s organization affects various facets of a business, including daily operations, taxes, personal assets, legal protections and risk.
How Many Small Businesses Will Be Launched in 2022?
Experts estimate that roughly 5.6 million small business applications will be filed in 2022, a 28% increase compared to figures for 2020. That number might be slightly higher, with a recent survey finding that roughly 17 million people aspire to launch a new business in 2022.
What Makes a Small Business Successful?
Even a good idea for a small business requires knowledge of how to operate effectively, especially if new business owners want to succeed in a competitive industry. Here are some key concepts on how to ensure a small business becomes successful.
Seek a Specialty
A successful business brings something original to the marketplace, even if its products or services are similar to those in its area and industry. It can accomplish this by offering specialized products or services that none or few other competitors provide.
Neither individuals nor businesses thrive in isolation. Connecting to other professionals in the same industries, whether in person or online, ensures business owners are always in the loop about new developments. It also gives them the chance to build long-lasting relationships that could prove mutually beneficial in the future.
Achieve With Digital Marketing
For most small businesses, forming and expanding their online presence is almost a necessity. It’s also among the best and most affordable ways to generate leads and increase revenue. Using the tools of social media, email marketing and search engine optimization to their fullest will pay dividends for any small business in the future.
Adopt Systems That Work for Large Businesses
Just because a large business operates on a wider scale doesn’t mean a small business can’t benefit from using similar systems, like toll-free numbers, interactive voice response and website automation. Adopting these practices will surely lead to good outcomes for any small business.
What Small Businesses Make a Lot of Money?
A tremendous concern when coming up with a great small business idea is whether or not it will be profitable. Those seeking to start a small business should first consider what types of businesses tend to make a lot of money. Here are some potentially profitable business ideas.
Money-Making Small Businesses
- E-commerce. Selling products online through e-commerce platforms like Shopify is among the simplest and most profitable small business ideas out there. A business starter can sell any product, whether from a supply they purchased or restored or even from stock they produced themselves.
- Dropshipping. Another lucrative small business idea that’s easy to start, dropshipping involves building an online store, marketing it effectively then — upon receiving customer orders — forwarding the order to a supplier who will send it to the customer.
- Web Development. Every business needs a professional website these days. Becoming a website designer and developer with this niche focus could prove profitable. With numerous online resources and courses available, there’s never been an easier time to become a web developer.
- Digital Marketing. Copywriting, analytics and social media management are all essential to any company. There’s a great deal of money to be made in helping companies expand their web presence to grow their business.
What Are the Top 10 Most Successful Small Businesses?
While brainstorming potential ideas for a small business, it’s important to consider the ones that are usually the most successful. Doing so can help narrow down the best ideas and perhaps reveal unseen gaps in the market. Here are 10 of the most successful ones.
1. App Development
Becoming an app developer requires a low initial investment and a few resources to start up, meaning nearly anyone with a solid idea for a mobile app that’s entertaining or useful can potentially succeed. The app industry is also highly profitable, with more than $28 billion spent on apps in 2020 alone. So anyone who comes up with an idea for an app their friends and family would use can likely develop a successful small business around it.
2. Personal Training
Personal training is another great small business idea that requires few initial resources with a high potential for success. All it requires is some pieces of equipment, maybe a gym membership with a guest pass and considerable knowledge in personal health, fitness and nutrition. Becoming a trainer requires no degree or certification, but instead client satisfaction and consistent results as well as solid personal branding and social media skills.
3. Cleaning Service
Starting a cleaning service is also a lucrative small business idea, as residences and businesses almost always require cleaning. This necessity means there will be a steady stream of clients and revenue. Additionally, a cleaning service is a great business to start from home and expands well over time.
4. Freelance Copywriting
Becoming a freelance copywriter is another profitable business idea. All one needs is a strong writing portfolio, a good internet connection and some key knowledge in search engine optimization and best practices of content and social media platforms. As a small business with low overhead and a great degree of flexibility and creative freedom, becoming a freelance copywriter is an attractive small business idea.
5. Real Estate
Creating a real estate agency can be challenging, but also has a high potential for success. Some may want to attend courses and pass an exam to become licensed real estate agents. Others can simply purchase properties and resell them for large returns or rent for passive income. Real estate is a great small business that can easily become successful with enough dedication and smart decision-making.
6. Freelance Graphic Design
Similar to copywriters, freelance graphic designers can develop a highly successful small business based on their artistic abilities. Numerous businesses locally and online seek expert graphic designers to create logos, websites and other media that establish the look and feel of their business. With an impressive enough portfolio, nearly anyone with skills in style and visual art can potentially create a successful small graphic design business.
In line with online educational services, tutoring is a small profitable business idea as individuals and families seek assistance with continuing education, test prep and coursework help. With the wide availability of video conferencing platforms and screen-sharing programs, offering tutoring services has become a low-cost, east-to-start business. All one requires is proof of expertise within a subject and a track record of satisfied clients.
Homeowners and businesses want their outdoor spaces to look as presentable as their indoor ones but may not have the expertise or equipment. That’s why landscaping is another great small business one can easily start. All that’s required is an investment in proper equipment, a great degree of basic knowledge in gardening and horticulture and some simple online marketing to establish the business’s presence.
9. Home Improvement
Maintenance, repairs and installations are constants within every house. Handymen and home improvement experts can form highly-successful small businesses with a decent set of tools, a steady stream of replacement parts and a strong foundation of knowledge in repairs and installations.
10. Child Care
Fewer than one-in-three children in the U.S. has a stay-at-home parent caring for them on a full-time basis, which is what makes providing child care services another profitable business idea with a high potential for success. It requires a track record of assured parents and happy, active children and, most importantly, trustworthiness. With those elements in place, anyone can build an excellent small business, providing childcare to local families in their area.
What Is the Best Business for a Starter?
The best business for a starter — or someone looking to launch a small business — is one that matches their talents, abilities and experience. No business can be successful without its founder knowing the ins and outs to some degree.
Any one of the ideas for a small business listed in the previous section can be a great idea for a beginner, but it must be one that they are good at and that they feel fulfilled and committed to continue doing for years to come.
What Business Will Grow in 2022?
There are no guarantees in predicting what businesses will succeed or fail, especially in light of the effects the recent pandemic had on business in the U.S. and the world. However, looking at data from the U.S. Department of Commerce can help show what small businesses will grow in 2022. Here are some types of businesses that are projected to expand within the year:
- Administrative and Support. This industry consists of businesses that provide services in general management, personnel administration, clerical duties and janitorial services.
- Real Estate. This industry involves the renting and leasing of properties as well as managing, selling or buying them for others. Assisting with appraisals of property values is also part of the work.
- Utilities. This industry focuses on providing electric power, gas, water and sewage to residents. This also includes specific services like generation, distribution, treatment and disposal.
Anyone looking to launch a small business has several options to consider. The most profitable business ideas tend to stem from a passionate, skilled individual or group of individuals working together in the same field.
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