The odds are not in your favor
Are you sick of playing entrepreneurial Russian roulette? Tired of the fear of failure looming over your head?
Well have no fear, my fellow risk-averse friends, because there are businesses out there that actually have a decent chance of surviving the turbulent world of small business ownership. And lucky for you, I’m here to dish out details on six of them.
If you are thinking of starting a business but worried about the risk of failure, you’re not being irrational.
According to the U.S. Bureau of Labor Statistics, 20% of small businesses fail within the first year, 50% within five years, and two-thirds within ten years.
Those are not great odds. But the good news is that certain businesses have a much lower failure rate. There is no such thing as businesses that never fail, but you can certainly improve your chances.
Stack the deck by investing in one of these
Today, we’ll explore six types of businesses with low failure rates – backed by data. Interestingly enough, you will notice there is a combination of brick-and-mortar, service and real estate based businesses on this list.
Whether you are starting a small business or buying an existing business, these successful small businesses are great places to start when becoming a business owner.
1. Laundromats
That’s right, folks. If you’re looking to become small business owners with a high success rate and low overhead, laundromats are the way to go.
Not only are they recession-proof, but they also provide an essential service that’s always in demand. Plus, who doesn’t love the smell of fresh laundry?
But wait, there’s more.
Laundromats are also incredibly easy to manage. You don’t need a large staff or a ton of experience to run a successful laundromat. Just make sure your machines are in good working order, and your customers are happy.
Think about it: everyone needs to do laundry. If you can provide a clean, convenient and affordable place to do it, you’ll have customers for life.
And with the rise of technology, managing a laundromat has never been easier. You can set up keyless entry, tracking systems and automated contracts to make the process smoother and more efficient.
So, what’s the catch?
Well, there isn’t one, really. Laundromats are a tried and true business model that’s been around for decades. And costs of operation tend to be low, allowing for good potential for profitability.
With the right business model and marketing strategy, laundromats can be successful and a very lucrative business.
2. Rental property businesses
Listen up, real estate lovers! If you’re looking for a solid investment with a kick-ass 85.3% success rate, then rental properties are where it’s at.
And the icing on the cake? You don’t even have to deal with being a landlord. Just hire a property manager to handle the headaches and let you focus on the fun stuff, like spending all that sweet rental income on exotic vacations and fancy cars.
Plus, with the added benefit of generating monthly cash flow through rental income, you can sit back and watch your investment grow. And let’s not forget about the tax benefits associated with real estate investing, including 1031 exchanges, depreciation and amortization.
So, if you’re looking to build long-term wealth, investing in rental properties might just be your ticket to financial freedom.
3. Self-storage facilities
Self-storage facilities may not be the sexiest investment, but they certainly get the job done with a 92% success rate.
Thanks to technology, it’s now possible to run these facilities remotely with keyless entry, tracking systems, security systems and automated contracts. Which means you can sit back and watch the cash flow in while sipping your margarita on the beach.
But what makes self-storage even more attractive is the value-add component.
Unlike other asset classes in real estate, self-storage facilities offer the opportunity to improve and upgrade existing facilities. From solar panels to eco-friendly materials, there are plenty of ways to enhance the value of your investment.
So if you’re looking for a low-risk business venture that’s both scalable and profitable, self-storage is definitely worth considering.
4. Transportation businesses
Well, well, well. Looks like the pandemic has changed more than just our work-life balance and our pants size. Online shopping is here to stay, and transportation businesses are reaping the benefits with a success rate of 76.4%
According to Advisor Smith, last-mile delivery has become a crucial part of our economy, and transportation and logistics are in high demand.
That means it’s the perfect time to hop on the bandwagon and invest in a short-distance trucking company, or even start a side hustle driving for Uber on the weekends.
With minimal startup costs and a low risk factor, transportation is a no-brainer for those looking to make some extra cash. So, get behind the wheel and hit the gas – there’s money to be made.
5. Vending machine businesses
Let’s talk about vending machines, shall we?
I know what you’re thinking: “Who even uses vending machines anymore?” But hold your snarky comments for a second, because these things are still going strong with a success rate of over 90%. That’s right, people still love the convenience of grabbing a snack or drink on the go.
What’s even better is that you don’t need a ton of cash to get started. In fact, you can start with just one vending machine and scale up from there.
And there’s plenty to learn about logistics, pricing, margins and managing a few contractors or running it by yourself. It’s the perfect starter business for the hustlers out there who aren’t afraid to get their hands dirty.
But don’t think vending machines are all about junk food and soda. Oh no, my friend. These days, you can vend anything from healthy snacks to travel necessities. Yes, you heard me right. You can provide convenience to people on the go while making a tidy profit for yourself.
And if you’re not sold on the idea of starting a vending machine business from scratch, you can always add it to one of your existing businesses.
Our friend Mike owns a 30-unit hotel that they recently converted into short-term rental units with a significant overhaul. And now they’re adding vending machines to sell items like phone chargers and beach towels to their guests.
See? The possibilities are endless.
6. Senior care centers
We all know that we’re getting older and crankier every day, but senior care centers offer a fantastic investment opportunity with surprisingly low failure rates.
With the US population aging rapidly, the demand for senior care centers is on the rise, and the government is even chipping in to help subsidize the cost.
Investing in senior care centers can be a bit more complex than the other businesses on this list, as you’ll need to navigate zoning regulations and work with healthcare professionals to ensure you’re providing top-notch care to your residents.
But if you’re up for the challenge, senior care centers are great businesses to invest in. Plus, it’s nice to know that you’re making a positive impact on people’s lives as they enter their golden years.
So there you have it, 6 businesses with low failure rates that you might want to consider investing in.
Of course, investing in any business comes with its own set of risks and challenges, but with a little research and a lot of hustle, you might just find yourself on the path to financial freedom.
Now, go out there and make some money, my friends!
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