We continue our 2006 trends forecast series here at Small Business Trends. In this post we outline our own list of the top ten promising small business opportunities for 2006.
First, a few words about how I chose the top ten.
i) The list is limited to businesses that the mainstream can identify with. You won’t find specialized technology niches such as nanotechnology, biomedical devices, or RFID. While such technologies are important and are gaining ground, they have little relevance to the mainstream core of small businesses.
ii) The list focuses on businesses that can be started by the average entrepreneur who does not have a huge financial stake. Some can be started for virtually no investment or even a few thousand dollars. Others will take more than that. But none require millions of dollars in investment in infrastructure, warehouses, factories or equipment to get started.
That said, here is the Small Business Trends list of Top Ten Promising Business Opportunities for 2006:
1. Outsourced information technology services
- Small businesses do not have the staff internally to handle all their information technology needs. More and more they outsource slices of their technology needs. Even in larger companies it can make sense to outsource portions of IT services to experts. The concept of outsourced managed IT services is taking hold. Related to this is the growth of software as a service provided by a third party. Savvy small businesses are capitalizing on this trend. They are identifying niches where technology can be provided in the form of a service, and they are finding more willing takers.
2. eBay and Amazon related opportunities
- eBay selling continues to be core for at least half a million etailers, and has given rise to a whole follow-on industry of third party providers who offer services enabling eBay sellers to sell higher volumes by outsourcing backend functions. Something similar is happening at Amazon.com, for information products. Amazon has become a place for entrepreneurs and authors and musicians to sell their books, CDs and DVDs. And third party services are popping up to help these individuals get their wares into Amazon and to capitalize on Amazon’s marketplace.
- There are 142 million dogs and cats as pets in the U.S. according to the Humane Society of the United States. Americans in particular are willing to spend money on their pets (see the nearby post on Pet Industry Trends). Hot areas of growth include services for pets such as pet walking and pet sitting, special gourmet food treats, and specialized medical care for pets such as chemotherapy and dental cleanings.
Who’s doing it: Kookies; DoggieDesigner; National Association of Pet Sitters; Pet Care Rx.
4. Food and beverage related niche industries
- Americans’ palate for food and drink has become more sophisticated and varied. Interesting ethnic foods and high-end gourmet foods are particularly in demand and hot right now. This includes everything from opening up a themed coffee house or, increasingly, a tea house. Or it can mean opening up a specialty bakery or gourmet food shop, or a cooking supply store.
Who’s doing it: Specialty Cheese; Ten Ren Tea.
5. Hobby and avocation-based businesses
- Some days it seems like everyone you meet is looking for ways to turn their hobbies into businesses. Hobby-based businesses have actually become big business in many cases. Just look around at how motorcycle dealerships, NASCAR racing, and craft stores have grown up. While the concept of a hobby-turned-business is not new, the widespread nature of it is. Nowadays it is not at all uncommon to hear of someone having a side business based on a hobby.
6. Anything security related
In today’s world of cybercrime and identity theft, we feel less secure, both online and offline. People are willing to pay today for services to help protect them from identity theft, for home security systems, and for shredding services to foil dumpster divers.
7. Services for seniors and retired people
- It’s no secret that the populations of America, the U.K., Europe, Japan and Canada are aging. Products and services designed specifically around the needs for older people continue to grow — everything from dating services for older individuals, to home health care, to jitney services to drive elders to appointments.
8. Information filtering services
- Never before in history has the average person had access to so much information and means of communication at their fingertips. But we are overwhelmed with information. We need services, technology, and sometimes even people — to help us filter all the information and find what’s relevant to us.
9. Hospitality businesses that create an experience
Recreation in the form of travel is big business. Bed and breakfasts, catering services, and specialized tour services and destinations are big (guided hunting tours, ecological trips to observe nature, charity trips to spend two weeks helping rebuild homes destroyed in natural disasters, and similar experiences).
Who’s doing it: Serendipity Adventures; Ducky Bob’s.
10. Hispanic products and services
- Hispanics are now the largest minority in the United States – and the numbers will keep growing. Products that cater to Hispanic tastes and lifestyles continue to grow. This could be anything from Hispanic-style foods, to Spanish-language publications, websites and radio stations, to services appealing to Hispanic immigrants (such as money transfer and immigration assistance services).
Who’s doing it: El Restaurante Mexicano; Radiovisa.