The world has recently entered one of the worst economic downturns since the Great Depression. Many of the problems that precipitated the current economic crisis can be traced to the COVID-19 pandemic. Therefore, it is expected that the economy will make a bit of a recovery after the pandemic comes to an end.
Unfortunately, there are a couple of reasons that a long-term recession is probable:
- There were red flags about a possible recession before the pandemic erupted.
- Some of the economic problems caused by the pandemic itself will persist long after it subsides. Over 100,000 businesses have already permanently closed as a result of the outbreak.
This raises some real concerns for entrepreneurs. A number of business owners are struggling with companies that don’t fare well during a recession, such as restaurants.
New entrepreneurs are at more of an advantage here. They can choose to start businesses that tend to be much more resilient during an economic downturn.
If you are planning on starting a business, then you should choose a model that is as recession proof as possible. Some of the best recession proof businesses are listed below.
Logging businesses can do very well during a recession. You don’t need a lot of experience to get started either. You just need to buy the properties and maybe invest in tools from companies like Mount Sopris.
You probably haven’t considered opening a funeral home. Funeral homes are obviously not the most pleasant type of business to run. It can also get depressing to talk about what you do with new acquaintances, dates and other people you meet on an occasional basis.
However, they are incredibly recession proof. People don’t stop dying when the economy goes south. Their loved ones can’t wait until the economy improves to pay their respects and provide a final resting place. This is a great opportunity to consider in any economy.
This is a flipside of funeral homes. People don’t stop dying during a recession. They also don’t stop having babies either.
You could provide a pretty stable business selling baby products, even in the midst of a severe economic recession. People won’t stop providing necessities for their children during a recession.
However, it is important to focus on selling products that will be in high demand throughout any economic cycle. As a rule of thumb, you should probably avoid selling luxury products for upper middle-class families. These products might not be in such high demand during a downturn if either or both parents lose their job.
Standard baby clothes are going to be in high demand all the time. You can also create a stable business model selling essential health products for newborns, such as thermometers and baby pill bottles.
Blogging and digital marketing services
Smart businesses will continue to invest in marketing during any economic cycle. However, their marketing strategies are likely to change with the tides of the economy.
Some businesses don’t realize how much money they are wasting on ineffective marketing tactics until the economy takes a nosedive. A recession forces them to reevaluate their strategies and consider more cost-effective alternatives.
Digital marketing tends to be one of the most highly sought out services during a downturn. It has a much lower price point and tends to convert very well.
People want to be a lot more frugal when the economy tanks. They find creative ways to save money, which includes growing their own food. People will realize that gardening supplies are a great investment during a bad economy, which makes this a great recession proof business model.
Couponing websites have propped up everywhere in recent years. There is a good reason for that. People are always looking for ways to save money.
People will be even more interested in couponing during a bad economy. This might be the perfect time to start a coupon website of your own. Although this niche is fairly competitive by logging industry standards, it is still a lot easier to start than most brick and mortar businesses.
Choose the right recession proof business to prepare for the hard road ahead
The economy is poised for a challenging downturn in the coming months. The good news is that you can still survive starting a new business. You just have to choose the right recession choose the right business model.