When people are out of work and jobs are scarce, interest in starting your own business rises. If there are no jobs, one solution is to make one. But, what is the best one to start where you can have an income flow immediately and not be burdened with too much monetary outlay up front? For starters, don't respond to the "make executive pay at home" or similar ads. These are almost always scams that will take whatever financial resources you have and give you nothing in return. The Federal Trade Commission keeps an extensive list of scammers. If you are tempted by one, search online to see what people are saying about it or search on the keywords "work-at-home" scams. It is appalling how many people are trying to take advantage of ordinary folks who are desperate. Here are some better ways to get some cash flow during tight economic times.
Freelance at Your Old Job
The most obvious choice is to become an independent contractor or consultant in an area that you have some expertise. There are numerous freelance websites that link independent contractors with job opportunities. One outcome of tight budgets is that many businesses are closing whole departments and outsourcing many of their standard needs to avoid the overhead of office space and benefits for employees.
If you do decide to go the freelance, independent contractor route, do it professionally. You are a small business owner with one employee - you. That means setting a price for your time and/or setting fees for services and expecting a formal, written contract for the work. Do your research so that you are competitive in the market and know what businesses are hiring out what types of work. Have business cards that you hand out to everyone you meet, especially folks like your banker. Try to get yourself known to a diverse community of potential contractors. That way, if one business gets hit by recession problems, you have others that are still giving you work.
Meet a Need in the Marketplace
Maybe, however, you want to take this setback in the economy as an opportunity to finally dive into your dream of owning your own business. But how do you choose which one to start? The Internet abounds with endless advice about which businesses are doing well and which are not doing well in this economy. One website will tell you that you need to start with a franchise because they know what is working and what isn't. Another will tell you that franchises are exactly where you don't want to be because many are over-extended and close to folding themselves. Even the national lists from professional surveys are only generalities and not focused on your particular market.
Your best bet is using your common sense, reading your local newspaper, and searching the Internet for consumer trends.
- Addressing problems being faced in the down economy may offer opportunities for new businesses. Consider maintaining foreclosed houses for banks, debt collection, providing financial or legal advice to help people with their debt, helping write good resumes, and selling items on the Internet for folks who need money, but are not computer savvy.
- No matter what is happening in the economy people are going to need food and health care; people will still be dying, having babies, and getting married; and people still want entertainment and to travel, albeit in much more economical ways.
- Many people are looking for training in other work skills. What skills do you have that you can teach?
- Historically, some of the most successful businesses were started during a recession to meet a new challenge. Find out what businesses thrived during down times.
- In challenging times, what people choose to buy with their limited income changes. Research consumer spending habits to find out what people are buying.
- Sometimes reading lists helps spark an idea. Scan lists of Business Possibilities to learn what others are doing.
And, when you think you are ready to take the leap, take a look at our advice on Starting/Buying a Small Business and Business Planning.
