{"id":3525,"date":"2018-11-18T17:32:40","date_gmt":"2018-11-18T15:32:40","guid":{"rendered":"https:\/\/www.lending-express.com\/blog\/?p=3525"},"modified":"2021-01-07T13:38:48","modified_gmt":"2021-01-07T11:38:48","slug":"most-profitable-small-businesses","status":"publish","type":"post","link":"https:\/\/www.become.co\/blog\/most-profitable-small-businesses\/","title":{"rendered":"The 8 Most Profitable Small Businesses in 2021"},"content":{"rendered":"\n\n

Some people know exactly which small business to start and where their passion lies.<\/p>\n

But what if you\u2019re not one of those <\/i>people? What if, your passion is to have a profitable <\/i>small business, but you\u2019re stumped for small business ideas? Not to worry, here we\u2019ll help to open your mind to ideas and present you with 8 of the most profitable small business ideas.<\/p>\n\n

What are the most profitable small businesses?<\/h3>\n
    \n
  1. Accounting\/Bookkeeping Services<\/strong><\/a><\/li>\n
  2. Real Estate Leasing<\/strong><\/a><\/li>\n
  3. Restaurant\/Dining<\/strong><\/a><\/li>\n
  4. Automotive Equipment Rental<\/strong><\/a><\/li>\n
  5. Warehousing and storage<\/strong><\/a><\/li>\n
  6. Retail (Online)<\/strong><\/a><\/li>\n
  7. Software (System & Application)<\/strong><\/a><\/li>\n
  8. Design Services<\/strong><\/a><\/li>\n<\/ol>\n\n

    To find out why, keep reading…<\/p>\n\n

    8 most profitable small business ideas<\/h2>\n

    With the help of data from Sageworks<\/a> and NYU Stern<\/a>, we\u2019ll enlighten you on the most profitable small businesses and industries in the US. These industries offer huge potential for those seeking a more stable environment in which to launch their dream enterprise. We\u2019ve picked our top 8 from the two sources.<\/p>\n\n

    Full list by NYU Stern:<\/strong><\/p>\n

    \"\"<\/p>\n

    \u00a0<\/p>\n

    Full list by Sageworks:<\/b> <\/b><\/p>\n

    \"\"<\/p>\n\n

    What is a profit margin?<\/h2>\n

    There are different ways to measure a business’s financial health, so what is a profit margin exactly?<\/p>\n

    Profit margin is defined as the percentage of revenue that exceeds the costs involved in running the business. The average net margins for the S&P 500 in the fourth quarter of 2020, for example, were roughly 8%<\/a>. That means companies with a net profit margin of over 8% are doing better than average. Below, we list 8 industries that have better-than-average profit margins.<\/p>\n

    [bctt tweet=”The #S&P500 has an average net profit margin of 9.5%, so if your #business is doing better than that, it means you’re in great shape!” username=”Become_co”]<\/p>\n\n

    Getting started – Most profitable small businesses<\/h2>\n

    A great small business will always start out as just an idea, but the fact is, some businesses and industries have a much higher profit potential than their counterparts. As an entrepreneur or someone seeking a new independent career path, you may want to focus on one of these ideas.<\/p>\n\n

    8 Most profitable small businesses in 2021<\/h2>\n\n

    1. Accounting\/bookkeeping services<\/span><\/h3>\n

    Of course, this is number one. As it turns out, accounting, tax preparation, bookkeeping, and payroll services have a 20% profit margin according to NYU Stern and an 18.4% profit margin according to Sageworks! Financial services are needed in every business guaranteeing huge demand no matter the weather. While accounting certifications require a degree, bookkeeping and tax preparation training aren\u2019t too difficult to get your hands on. Once certified, the only overhead costs are space and a computer, making it the perfect business to launch from home. Plus you\u2019ll be near-guaranteed to turn profits as well as heads.<\/span><\/p>\n\n

    2. Real estate leasing<\/span><\/h3>\n

    Real estate leasing is one of the most profitable businesses to be in right about now, with a profit margin of 17.9% according to Sageworks. One <\/span>report <\/span><\/a>suggests that there are most households renting than at any point in the last 50 years, especially young adults struggling to get on the property ladder. Leasing agents can work from anywhere, no office space needed – just a desk and working computer.<\/span><\/p>\n

    The steps to becoming a real estate lessor (not to be confused with <\/span>how to become a successful real estate <\/span>agent<\/span><\/i><\/a>) will depend on which state you live in. In some locations, you\u2019ll need a leasing agent license while in other places you\u2019ll need a real estate agent license. From where we\u2019re standing, this looks like a pretty good investment.<\/span><\/p>\n\n

    3. Restaurant\/dining<\/span><\/h3>\n

    Hungry for profits? Ever consider monetizing your culinary skills? Net profit margins in the restaurant industry amount to roughly 12.1% (NYU Stern), which paints a promising picture for those who are cut out for the occupation. While there are a fair amount of permits you\u2019ll need to obtain and regulation you\u2019ll need to abide by, there\u2019s no shortage of customers – everybody eats! Plus, new <\/span>restaurant tech trends<\/span><\/a> are helping to streamline the business so that owners can optimize their profits. If the cost of rent puts you off from the idea, running a food truck is a great way to dodge that expense while simultaneously spreading your name to new locales as you move around.<\/span><\/p>\n\n

    4. Automotive equipment rental<\/span><\/h3>\n

    With net profit margins of 12%, it seems that more and more people are putting a hold on purchasing cars. The automotive equipment rental and leasing industry is projected to <\/span>continue growing<\/span><\/a>. Most cars are known to depreciate in value and are costly to maintain, plus growing cities and traffic jams are driving more and more people towards renting or leasing. That way they can use public transport or companies such as Uber and Lyft to get from point A to B. With no hard qualifications needed, this is a fairly easy industry to enter!<\/span><\/p>\n

    \"\"<\/p>\n\n

    5. Warehousing and storage<\/span><\/h3>\n

    Many businesses deal with \u2018things\u2019, lots of things. Whether their inventory is composed of clothes, furniture, equipment, or any other goods – businesses that thrive off of selling products will need storage space, and space is limited. On top of that, homeowners are often looking for space to store their beloved belongings when moving or even need it for their extra things. Whatever the reason, space is a hard thing to come by and has led to a demand for warehouses and storage facilities in both the commercial and residential industries.<\/span><\/p>\n

    With an average profit margin of 11.6%, the great thing about this business is that no education or formal training is necessary. If you\u2019ve got a brain, a touch of bravery, and perhaps a bit of experience in the industry, you\u2019ll be off to a good start! Here\u2019s the catch: constructing, renting or purchasing large amounts of storage space requires a hefty capital investment. Especially those close to big cities.<\/span><\/p>\n\n

    6. Retail (online)<\/span><\/h3>\n

    Online retail, otherwise referred to as eCommerce, is one of the fastest-growing industries nowadays. Over the past 19 years, online retail sales have grown 300%<\/a>, and nearly 70% of Millennials report a preference for shopping online over in-store. Plus, according to NYU Stern data, the net margins are more than 11%. If current <\/span>eCommerce trends<\/span><\/a> continue, we can expect those net margins to grow even more and for improved e-commerce business profits<\/a>.<\/span><\/p>\n

    Concerned over recent headlines reporting a \u2018retail apocalypse\u2019? The competition between online retailers and <\/span>brick-and-mortar stores<\/span><\/a> isn\u2019t over yet!<\/span><\/p>\n\n

    7. Software (system & application)<\/span><\/h3>\n

    We\u2019re living in the digital age, there\u2019s no doubt about it. Every day people are creating more technological innovations that change the way we work, shop, learn, socialize, handle our finances, and much more. In order to be successful in the software industry, you\u2019ll need to invest time in improving your skills on an ongoing basis since programs and techniques are constantly evolving. It\u2019s a bit surprising that the net profit margins for the software industry aren\u2019t much higher – they rank at a little under 10.5%. But, as high tech continues to make its way into more and more industries, the net profits are likely to grow as well.<\/span><\/p>\n\n

    8. Design services<\/span><\/h3>\n

    Calling all creatives minds! Have you got a knack for creativity and don\u2019t want to let your passion go unused? Design services rake in an average of 10.2% in profit margins.<\/span><\/p>\n

    Design services encompasses a number of different focuses, including:<\/strong><\/p>\n