Most Successful Small Business Ideas
Many of us have dreamed about starting a business - being our own boss, setting our own hours, providing value to our community, and getting the financial rewards for our hard work. But starting a business can be a daunting task, and lots of us think things like “I want to start a business but have no ideas'' or “I have a business idea but don't know where to start”. Beyond getting started, ensuring the long-term success of your small business is extremely difficult as well. In fact, the Bureau of Labor Statistics estimated that 20% of new businesses fail within the first two years.
It’s not all bad news, though. There are many successful businesses out there, and lots of resources that can help you get started! One of the great options for being successful at starting a small business is to start a franchise. As a franchisee, you get the benefits of an established business model, training from your parent company, and built in brand recognition, while having all the flexibility and rewards of small business ownership.
What Are the Most Successful Small Businesses?
Franchises often make the most successful small businesses!
But defining the most successful small business is hard. First things first, what makes a business successful? This is a personal question you’ll want to ask yourself before you choose which business you would like to pursue. There are many factors that could influence your view of how successful a business is, including:
- The businesses profitability
- The speed a business can get up and running
- The amount of time it takes for a business to start turning a profit
- The ease of starting and running a business
- The startup costs for beginning a business
- The amount of time you’ll spend working in the business
- How fulfilled the work leaves you
All of these factors should be weighed for which is most important for you as a potential future business owner. Deciding how these factors rank for you will help narrow down your focus as you start planning.
One of the ways to quickly and easily get an idea of small businesses success is by loan default rate. The idea is that small businesses that are able to pay off their loans on time are successful ones, whereas those that default on their loans are not able to be successful. Since we’re talking specifically about franchises, a study of SBA loans to franchises from 2010-2021 has some very useful data. It showed these were the top 8 most successful businesses to start, because these had the lowest loan default rates:
- The UPS Store - 0% default rate
- Orange Theory Fitness - 0% default rate
- Comfort Inn - 0.67% default rate
- Dunkin’ Donuts - 1.10% default rate
- European Wax Center - 1.32% default rate
- Days Inn - 1.59% default rate
- Sport Clips - 1.89% default rate
- Great Clips - 2.98% default rate
Among all the franchises that received SBA loans, the average default rate was 9.9%, so these ten businesses are great options for success because they outperformed that average in a big way.
What Is the Easiest Kind of Business to Start?
When you start to think about starting a business, the question “what's the easiest business to start” might be at the top of your list. There are so many options for businesses out there, and each of them will require a different skill set and experience to get started. It can be hard to know where to even start.
For many people, franchises are the easiest business to start because they already have a clear history of success, and offer a step by step guide and training on how to be successful following the same play book. If that sounds good to you, then a franchise will likely be the easiest business for you to start too!
The franchise model makes starting a business easy in a few different ways, including:
- A proven track record of a businesses success, which provides more security in your investment
- Clearly laid out steps that show you exactly how to get started
- Training and guidance on how to set up and run your business before you ever open the doors
- Brand recognition and a built-in customer base
- Ongoing support from the parent company and other franchise owners
What Business Types Make the Most Money?
Looking for businesses with the highest profit margin isn’t an exact science either. There are a lot of factors that affect how much money a business or franchise makes, so it’s difficult to give one exact answer. One way to look for high profit business ideas is to search for companies with low startup costs in industries that are growing rapidly. Using this philosophy, according to NerdWallet, some of the most profitable types of business are:
- Food Truck
- Car Wash
- Auto Repair
- Personal Trainer
- Newborn and Postpartum Services
- Child Enrichment
- Mobile Apps for Children
- Borrowed or Rented Clothing Exchanges
Another way to look for small business ideas that make the most money is to consider businesses in industries that are traditionally big money makers. Some options that fit in this category are:
- Accounting and Financial Planning
- Real Estate
- Legal Services
- Cleaning Services
- Funeral Homes
What Business Can I Start Immediately?
If you feel like you don’t want to wait another minute to get started running your own business or franchise, you might have asked yourself “what business can I start today?” The answer depends a lot on what skills you already have, but there are probably more options than you think. Here are some of the types of businesses that lend themselves to being started right away, along with a few franchise options if you like the idea of having more guidance and support as you get started.
- Mobile Businesses
Do keep in mind that with most franchises, some work needs to be done before you can open your doors as a new business owner. Careful reviewing of the franchise documentation and receiving training from your franchise to give you the best start will take a little time. Often, however, investing time in these steps early on means you will be profitable sooner than if you started a brand new business from scratch.
Can I Start a Small Business with No Money?
Starting a new business or franchise can feel especially intimidating because it’s often thought of as very expensive. But that’s not true of all companies. There are many business options that don’t need a whole lot of capital to begin, and there are several options for borrowing the funds you’ll need to get started. It is possible to start a small organization without using any of your own money, although making sure you carefully consider your finances before you get started is always important.
So what is the best business to start with little money? Franchises can be a great option for starting a business without a lot of capital! If you’re considering starting a franchise business, the Franchise Gator website offers an easy search tool to let you look for franchises by investment amount. There are great franchise opportunities that require under $10,000 in initial investment, and even more options for under $50,000. Many franchises themselves offer discounts for veterans, grants, or funding options for franchisees to help you get started on your new career for very little out of pocket expense.
Here are some of the low cost options listed on Franchise Gator’s website:
- The Lending Network - $20,000 required capital
- Healthier 4 U Vending - $30,000 required capital
- OxiFresh Carpet Cleaning - $40,000 required capital
- Homewatch Caregivers - $50,000 required capital
How to Decide What Business to Start
At the end of the day, choosing the right business to start depends on your passions and priorities. You’re taking a great step toward achieving the life you want by deciding to become your own boss and taking charge of your career. Now it’s time to decide exactly what matters the most to you in this new career and then choose the best option that will help you reach your goals.
We could give you a list of top 10 small business ideas, but they’re not going to be the top ten best for YOU. Instead, we want to empower you to come up with your own list! Think through each of the prompts below, and we’ll walk you through what to do with your answers to get you to some of the best options to get you where you want to go.
Q: Do You Have Experience in or a Passion for a Certain Industry?
Search by Industry - If you are currently a car mechanic, for instance, obviously you could open your own repair shop. But, there are also business opportunities for detailing, paint and body work, auto parts, car wash, gas station, car rental and oil change companies. Or, maybe you are a mechanic who has a passion for cooking - you can search for career opportunities in this unfamiliar industry that will let you follow your passions.
Q: Do You Have Other Life Factors that Will Play a Role in Choosing Your New Business?
Search by Category - If you are a stay-at-home parent you can search for only home based businesses. Are you a veteran or specifically want to open a veteran-run franchise? Are you planning to apply for an SBA loan and only want to see franchise options that will qualify? Want to focus on financial security and interested in the most profitable options? The category options can streamline your search to narrow down your choices and give you a tailored list of businesses that will work best for you.
Q: Do You Have a Specific Amount of Money You Are Planning to Invest?
Search by Investment - If you know that you need to keep your investment to a minimum, there are franchise options for under $10,000. On the other hand, if you have more funds to spare, there are options all the way up past $1,000,000.
Q: Do You Know Where You Want Your Franchise to Operate?
Search by Location - Different states and countries have various business opportunities, so narrowing in on where you want your franchise to be located can help you find the perfect fit for your new business.
Franchise Gator: Connecting You to Your Successful Business Dreams
At Franchise Gator, we’ve made it our mission to help you find the very best business for your future. We believe that opening a franchise gives you a great start to being your own boss and running your own successful small business. We have hundreds of franchise options for you to choose from, with search options that make it easy to find exactly what you’re looking for.
Check out our complete franchise listings to see all the options, read our FAQs to make sure you fully understand everything becoming a franchise owner has to offer, and then explore our funding options to learn how to make your dream a reality.