The Small Business Issue
feature | Top 5 new business ventures

Top 5
small business
ventures of 2012


Small business is big. So big, in fact, that there were 23 million of them in the United States in 2009, according to the U.S. Small Business Administration’s Office of Advocacy. If you want to be one of the lucky half of them that survive for at least five years, you’ve got to pick a winning idea that resonates with consumers. Here’s a look at some of today’s hottest areas of opportunity for small businesses.


1 Mobile app designers

Did you know that 72 percent of small businesses use mobile apps in their operations? According to a recent study by cellular giant AT&T, it’s true. In a world where smart phones and tablet computers are ubiquitous, mobile apps are becoming more a marketing necessity than a nice-to-have extra.

According to a study by the mobile research group research2guidance, the market for mobile app development services reached $20.5 billion in 2011, and savvy small business owners can get their piece of the pie in an industry that’s expected to stay strong.

“If you have a business that serves small businesses, you should think about creating an app or making sure your website can be seen well in a mobile browser,” says Anita Campbell, CEO and editor in chief of Small Business Trends, an award-winning online publication for small business owners. “This suggests that there will be opportunities for web designers and mobile app designers.”

Adds Michael Covel, president of Trend Following and author of a book by the same name, “We can assume this connectivity [trend] is going to keep growing—that it’s not going to stop.”

The Small Business Issue
feature | Top 5 new business ventures

“The most intriguing opportunities for [small businesses] are the ones where it is an affordable luxury.”

  

Anita Campbell, CEO and editor in chief of Small Business Trends

  

2 Services for seniors

There’s a population boom going on these days, but it may not be the one you think. Instead of babies taking the lead, it’s the senior citizen population that’s expanding by leaps and bounds. In 2010, Americans age 65 and up accounted for 40.4 million of the U.S. population, an increase of 5.4 million since 2000, according to the Department of Human Services’ Administration on Aging. Further, this population is expected to balloon to 55 million in 2020.

What does all this mean for small business owners? In a word: opportunity. Americans who reach age 65 have an average life expectancy of an additional 18.8 years.

This population will require assistance meeting their needs as they age, such as “adult day care and shopping services [for seniors],” says Rieva Lesonsky, CEO and president of GrowBiz Media and SmallBizDaily.com. “It used to be hot to have people come in and baby proof your house, but now there are businesses that will go in and senior proof your house,” she adds.

Franchise Business Review, a market research company specializing in the franchise industry, recently reported the rise of senior home care. Eight different senior care concepts—including nonmedical in-home senior care, in-home care and assisted living placement, in-home senior care and health care staffing services—landed on its annual list of the top 100 fastest-growing franchises, underscoring the demand.

The Small Business Issue
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3 Little luxuries

In recent years, financial woes have wreaked havoc on people’s budgets, forcing many to put off big purchases and cut back on discretionary spending to bridge the gap. But according to a report by BIGResearch and STORES magazine, a publication of the National Retail Federation, that’s changing. Their research shows a gradual resurgence in discretionary spending by consumers who may have been spurred to make sacrifices due to the economic downturn.

Case in point: the New York Times recently reported that nail polish sales reached a staggering $710 million in 2011. “I dub this frugality fatigue,” says Lesonsky, of the trend to spend on a lesser scale, which extends to small businesses, too.

The study by BIGResearch and STORES also revealed what people deem “untouchable” vs. “expendable” in their budgets: dining at casual sit-down restaurants, getting their hair cut or colored, or enjoying a daily cup of gourmet coffee. This is good news for restaurant, salon and coffee shop owners, as well as other small businesses with lower price points. Though not big expenditures, these smaller indulgences make people feel less deprived than when they cut out all unnecessary expenses.

“The most intriguing opportunities for [small businesses] are the ones where it is an affordable luxury,” contends Campbell. “To spend $10 or less on a dog bandana—most people can find a way to afford that.”

4 Home furnishings

According to the Chinese lunar calendar, 2012 is the “Year of the Dragon.” It’s considered to be the most auspicious of the 12 animals in the Chinese zodiac and a good time to get married and have children. Why is this important? Because 12 years ago when the dragon had his big moment, sales in home furnishings surged.

And an analytics-based forecast by International Business Machines (IBM) predicts the same outcome this time around. IBM anticipates that in-store sales of home furnishing items will increase by nearly 8 percent to $23.22 billion and online sales will increase by 28.4 percent in the second quarter of 2012.

“It’s a good year to be settling in, according to the Chinese calendar,” says Lesonsky, who has noted a surge in the purchase of home décor items like throw pillows and other accessories that can enhance the look of your surroundings.

She says that it’s relatively simple for small business owners to tap into this trend. “These products are really easy to find and start selling online.” She recommends working through websites like eBay and Amazon.com, which have massive customer bases that extend the reach of entrepreneurs.

The Small Business Issue
feature | Top 5 new business ventures

5 Food

No matter what else is happening in the world, people will always need to eat. After steep declines in 2009 and 2010 and a plateau in 2011, total restaurant industry sales are expected to reach a record high of $632 billion in 2012—a 3.5 percent increase over 2011, according to the National Restaurant Association (NRA).

“There is a lot of interest in restaurants,” says Campbell. “When you think about it, every small town has restaurants. There are a lot of big chains, but there are also a lot of independent restaurants owned by mom and pop.” In fact, the NRA reports that 7 out of 10 eating-and-drinking place establishments are single-unit operations, in other words, small businesses.

For those who are willing to take the risk of opening a restaurant—research shows the failure rate hovers at around 60 percent for the first year—there is money to be made from people who are increasingly more comfortable parting with their cash in what the restaurant industry expects to be a banner year.

THE SMALL BUSINESS ISSUE
Top 5 small business ventures of 2012

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PHOENIX FOCUS | September 2012 | THE SMALL BUSINESS ISSUE

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Features


Top 5 business ventures of 2012

Find out what’s making waves this year in the world of small business.

Is small business still America’s backbone?


Martha Stewart’s food for thought

Tips for starting and sustaining your own business.


On the cover: Designing woman
Kerrie Kelly, MBA ’02

An interior designer with a head for business, Kerrie Kelly launched her own firm, Kerrie Kelly Design Labs, in 2006 and hasn’t looked back since.

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