How to Start a Profitable Business During the 2021 Crisis: Most Cost-Effective Ideas and Survival Tips
The economic crisis is adjusting the plans of businessmen and their clients, both are under attack. People have less money, wages go down, and prices go up. Business owners have to look for new prospects for earning money. Among the areas of business, you should choose those based on basic human needs. Consider a few popular ideas for what to do in a crisis.
Which businesses thrive in times of crisis
The greatest losses are expected for businessmen working in the sphere of entertainment and selling premium goods. It is on this that the population begins to save in the first place. Contrary to popular belief, the crisis is not a reason not to close your own business, but the opportunity for new development prospects.
In an economically difficult time for the country, it is worth paying attention to the specifics of doing business:
- Solvency is declining, but people are still willing to spend money on basic needs - housing, food and clothing. When deciding what to do in a crisis, consider these areas first.
- Cheap products are in greatest demand, even if the quality suffers. Pay attention to the Chinese and Russian manufacturers that produce consumer goods.
- The staff is being reduced in production, according to statistics, a third of small businesses go bankrupt. The labor market is overcrowded, those willing to work are ready to agree to a lower salary.
- People are not eager to buy new things, it is more profitable to repair broken household appliances or shoes.
Important advice! In a crisis period, you should not invest significant amounts in a new business; try to do business with a small start-up capital.
Be ready to implement new ideas, switch to related business areas if something goes wrong. Try to find the demanded direction.
The best option is to open a sales outlet where there are no competitors, but there is demand. The best location is rural or remote areas. A small kiosk or pavilion will do. Of course, if a retail chain is nearby, it is unlikely that it will be possible to compete with it, but in a village or small town, the store will be in demand.
Important! Concentrate on an assortment of low-cost everyday products, but don't cut out the expensive ones, and there will be a buyer for them.
If you put up a small counter for visitors and sell fast food, the popularity of the outlet will grow. In fast food chains, the average price tag is high, so there will be enough people who want to drink a cup of hot tea and eat a couple of pies.
Business Owner Blog
Subscribe and once a month receive a selection of useful materials and cases for sales growth, business automation, financial and management accounting
You have successfully subscribed to the blog
A crisis is a time of changes and opportunities. Should you start a business at this time? Definitely yes, if you choose the right niche, calculate your financial model, and roll up your sleeves.
We tell you what kind of business can take off in times of crisis.
People are always hungry. When the economy is shaken, most of the population opts for cheap food. Food made in Russia is often cheaper. Local manufacturers have lower shipping costs and no customs clearance costs. Add to this the trend towards import substitution.
We get one of the most promising niches for starting a business. In 2021, after the crisis, it had the highest efficiency ratio. RBC wrote about this:
Vadim Dymov, founder and owner of Dymkovskoe sausage production, believes that in times of crisis it is worth focusing on food, for example, growing soybeans or starting to produce milk.
- rent fields, equip an irrigation system, hire combine operators and plant potatoes, bell peppers, soybeans, corn, grain;
- build a farm and start producing meat - grow pigs, sheep, poultry, cattle;
- build a farm and produce eggs, milk and dairy products;
- create a processing facility: produce semi-finished meat or pasteurized milk.
The crisis has a different effect on the citizens of Russia: some try to save any penny, and the most enterprising come up with options for opening a profitable business. In order to determine a niche in business, you should make an assessment of your abilities.
If you have computer knowledge, you can work as a remote worker. The ability to bake pastries will allow you to bake at home, since this business does not require large investments.
A crisis is a total change in the economic and political life of a country caused by external state factors. The encyclopedia says that a crisis is>.
John F. Kennedy said that in Chinese the meaning of the word crisis includes 2 characters: the 1st means danger, and the 2nd means chance. That is, this is a period of recession and difficulties. As a result, income stops growing or starts to fall. So, the market changes during a crisis. You can get out of any crisis with the help of a well-established system of the entire business as a whole.
What should businessmen fear during a crisis?
The first thing that comes to mind to the head of a small profitable business with the beginning of the crisis is: "Shrink down on costs, cut costs, lower the profit plan." Optimizing costs is always a good thing, as you shouldn't waste money. The goal of cost optimization in reducing profits is to retain and attract customers!
"Feed. y ": Rogozin: Uncertainty. For business owners, this uncertainty represents a sensation that ordinary residents rarely experience. Alarming expectations are emerging against the backdrop of a worsening economic situation. The main concerns of entrepreneurs are not related to inflation, as can be seen from opinion polls.
The main actor that brings unpredictability to the market situation is the government. Our respondents acknowledge that there are competent people in the government and there is no need to train them. They do not understand, on the basis of what the policy of the Central Bank is changing, how decisions on support are made. They only understand that when it comes to support, it means that you need to prepare for the worst.
How rational is it to think about starting your own business in such a situation?
Do you have an opinion that times are harsh and business will not develop? A profitable business should be opened when you are prepared for it. When you can tell yourself: I want to be successful and have a lot of money. You live now, and this is the best time to create a profitable business. No need to wait!
An independent case in the crisis of 2021 and subsequent years will be difficult to do, but you will be your own commander. The doubts that arise when starting your own business are understandable, with all this, a start-up in a crisis is a risky undertaking.
However, starting a business during a difficult economic situation has its advantages. You will become more motivated than those who started before the crisis.
Benefits of starting a business in times of crisis:
The fall in the exchange rate of the national currency, a decrease in the income of the population, quarantine restrictions due to the coronavirus have put many companies on the brink of survival. Business in crisis will face dramatic changes. Some sectors of the economy will not survive the fall in demand, while others will be reorganized under the new conditions in order to retain customers. And someone will study the market and try to implement profitable business ideas. One thing is known: now is not the time to lose heart and expect support from the authorities.
From this article you will learn:
factors influencing business development during the crisis
To correctly determine what to do during the crisis, you need to look at the market through the eyes of the consumer. So you will understand what goods and services will be in demand, and what people will start saving on. In the 2021 crisis, businesses will be affected by the factors listed below.
People's fear of coronavirus
Even if the Covid-19 epidemic subsides by the summer of 2021, people will be afraid of a repeat of the situation for several months. Rescuing business offline will be hindered by the media, spreading panic among the population.
Many entrepreneurs will have to put work on a remote track. In particular, organize the delivery of goods, offer your employees to work from home.
Domestic market orientation
Due to the fall in the exchange rate of the national currency, it has become expensive for small businesses to purchase raw materials and materials abroad. The entrepreneurs were forced to urgently look for manufacturers, suppliers and other partners within the country.
IMPORTANT. Areas related to import substitution will help to develop in a crisis.
The topic of today's article will be the answer to a popular question in our time - what kind of business can you open in a crisis? What needs to be considered for this and shouldn't we wait until better times?
The crisis only at first glance seems to be such a terrible word, which is characterized by the closure of many enterprises, economic decline. In fact, this period can be called a real impetus for the development of new profitable ideas, opening your own business. It is worth looking at this time as a time of opening up new opportunities, because as you know, for a new stage of development to begin, the previous one must end. If you adhere to certain rules, then even in a crisis, a business can bring good to its owner and develop. You just need to be prepared for the fact that the demand for the offered goods can constantly change, and funding will be minimal. After analyzing the market, we can say that the crisis sometimes gives the opposite result than is expected of it. For example, during the last crisis, the number of sales of some of the most expensive cars in the world did not decrease, but rather increased, which means that the world does not stand still, so you should try, and suddenly your idea will bring you real income in the future.
How to do business during a crisis?
There are several rules to keep your business afloat:
- Maintain the ability to compress your business. The real risks that may arise when opening new projects are no different from the risks for existing ones, since both for the first and for the second the main risk will be a lack of liquidity. Some entrepreneurs are very worried about the decline in demand for their products, but this is not as dangerous as, for example, a complete lack of funds for development. The drop in demand will be critical only if the business cannot shrink in proportion to the drop in demand.
- Since the bulk of the funds are spent on paying rent and salaries to staff, it is not advisable to hire new employees during a crisis and also to stop indexing salaries. The ideal option is to switch to piecework wages. Only the use of a flexible business system will keep us “afloat”.
- Remember liquidity. If the business does not have sufficient liquidity, this could lead to serious problems in the future. For example, during the 2021 crisis, many real estate projects were forced to close due to the lack of the necessary funds for their continued existence. If a manager can maintain the policy of the organization, at least for minimal development, it will be able to withstand any crisis.
- Search for new solutions, creation of non-standard economic solutions. As mentioned earlier, any crisis is an engine of progress, which is why many entrepreneurs reach a qualitatively new level of development of their business and can earn many times more than during a period of relative stability. You can try working in a parallel direction. Let's say that before you were only selling books, now it’s time to try to sell office supplies as well. Or you can approach the issue completely outside the box, sell books in a cafe, where your customers can not only enjoy delicious coffee or tea, but also immediately start reading the book they just bought.
- Try to change or improve your idea. It is always necessary to think about putting the idea of development in the first place. Even if you have a ready-made business plan, you still periodically make changes or additional points to it, so you can attract more customers and allow you to give your business a new impetus for development.
- Try different alternatives. For example, if you used to sell in a regular store, and for this you had to pay huge amounts of rent for premises, now is the time to try to create an online store. So you can expand the range of your products (saving on rent), and do what you love practically without leaving your home. Of course, you have to learn a little about doing business on the Internet, but if you work hard, you can definitely make good profits.
What is profitable to do in a crisis?
When creating a new business idea in an unstable time, it is important to clearly understand where and how much you will have to invest, because the mistakes you make will cost you dearly. For example, you need to consider the following aspects:
- terms of development;
- what will be the costs and revenues;
- how much you can invest in the business;
- how quickly the project will pay off;
- what equipment will be needed;
- how many employees will need to be hired, etc.
It is also worth analyzing the market - what is at the peak of popularity, and what is better not to do? What business can be taken as an analogy?
When developing an idea for a new business, it is important for an entrepreneur to take into account: - the latest market trends, especially in the area where an entrepreneur wants to start his own business; - the cost of promoting and introducing manufactured products or services; - risks.
It is also important to pay attention to advertising, as with its help you can tell a large number of people about your idea, and thereby attract future customers .. Only after considering the prospect can you start opening your own business.
How to correctly set prices for your services or goods during a crisis?
To make a profit, you should thoroughly review the cost of the goods / services you offer. It is important that you receive sufficient profit not only in the future, but also now. As a basis, you can take the Pareto principle (20% / 80%). Only 20% of the company's products / services make it possible to achieve a profit of 80%. It is precisely these 20% that are worth concentrating on. It is also important to follow the offers of competitors, try to attract customers to your side in time, and make sure that the opposite situation does not work out - customers are lured away from you.