Are you tired of working for someone else and dreaming of starting your own business? Well, there has never been a better time than now to turn that dream into a reality. Read this blog to find out why this is the best time to start a new business.
5,044,748 new businesses started in 2022 in the United States. Though this is a slight decrease from 2021, it still marks a record-breaking number of new businesses post-pandemic.
Starting a new business always comes with a certain set of challenges. On top of that, people are now more in a dilemma due to the aftereffects of the COVID situation and economic recession caused by this pandemic.
So, when is the best time to start a new business? Despite the economic uncertainty, now is actually one of the best times to start a business. Keep reading this blog to unveil our points behind this statement!
Is It a Good Time to Start a Business After The Pandemic?
The global pandemic has undoubtedly created a challenging environment for businesses. But it has also introduced unique opportunities to start new ventures.
According to a report by the Kauffman Foundation, there was an increase in new business applications during the pandemic compared to previous years.
The report suggests that people who lost their jobs or had reduced work hours turned to entrepreneurship. So, they can generate extra income.
Additionally, the pandemic has accelerated digital transformation and highlighted gaps in certain industries. Many entrepreneurs come up with innovative solutions to fill these gaps.
For instance, companies such as Zoom and Instacart have experienced significant growth during the pandemic. It happens due to increased demand for remote communication and online shopping services respectively.
Can the Current Economic Recession Impact Your New Business?
Despite the ongoing economic recession, starting a new business can still be a viable and profitable idea.
Many successful businesses such as Microsoft, FedEx, and Airbnb were started during times of economic downturn. Because recessions often create market gaps or opportunities for entrepreneurs to fill with innovative products or services.
Additionally, low-interest rates and government stimulus packages can provide financial support and resources for new businesses. However, it is important to carefully assess the potential risks and challenges before starting a business.
Entrepreneurs should conduct detailed market research, develop solid financial plans, and seek mentorship from experienced professionals to increase their chances of success.
A quick real-life inspiring story for you-
There are certainly obstacles to navigate during an economic recession. Starting a new business can still be a worthwhile venture for those willing to take calculated risks and seize opportunities in the marketplace.
What Factors to Consider to Start and Make a Business Successful
Starting a business requires careful planning, hard work, and dedication. Here are some important factors to consider to make your business successful:
- Determine Market Demand
- Conduct an Effective Business Plan
- Evaluate Your Financial Resources
- Make a Detailed Competitor Analysis
- Identify Effective Marketing Channels
- A Diverse Team with Powerful Skills
- Mind Set of Adaptability
Let’s talk about everything in detail.
i) Determine Market Demand
Before starting a business, it is important to assess the market demand for your product or service. According to a study by CB Insights, “lack of market need” was cited as the number one reason why startups fail.
If you can identify whether there is a demand for your product or service, the next steps would be easier. This may involve analyzing customer behavior, identifying target markets, and assessing competitors’ offerings. So you can ensure there is a viable market that is willing to pay for your product or service.
In this unstable situation, while people are trying to save money by cost-cutting, demand for many products is also increasing. Such as face masks, sanitizer, PPE kits, etc. On the other hand, the sales of digital products also rise as a result of technological advancement.
By ensuring that your product has a clear value proposition and addresses a genuine need in the market, you increase the possibility of success when launching your business.
ii) Conduct an Effective Business Plan
A business plan is a roadmap that outlines your goals, objectives, and strategies for achieving success. It is important to have a solid plan in place before starting your business. This will help you stay focused and organized to launch and grow your business.
During COVID, many established businesses faced a decline in their growth. In fact, some of them get closed due to fewer orders or unavailability of raw materials. But companies that added risk factors to their plans found it easier to survive tough times.
Additionally, having a solid business plan entrepreneurs can avoid common pitfalls that could lead to failure down the road. A survey conducted by Palo Alto resulted that people who create business plans are twice as likely to succeed than people who don’t.
iii) Evaluate Your Financial Resources
Sufficient capital is necessary to start and sustain a business. You’ll need enough funds to cover startup costs as well as ongoing expenses until the business becomes profitable. It may include startup costs, operational expenses, employee salaries, etc.
Ensure you have adequate capital to cover your business expenses and plan for contingencies. Also, calculate all options available to you, including loans, grants, and investor funding.
iv) Make a Detailed Competitor Analysis
Understand your competitors and the competitive landscape of your industry. Research their strengths, weaknesses, pricing, marketing strategies, and customer base. Identify ways to differentiate your business and offer unique value propositions to stand out in the market.
Below you’ll find a free framework for your competitor analysis–
It’s important to be aware of competitors in your industry so that you can differentiate yourself from them and offer something unique. Effective marketing is key to attracting customers and building brand awareness.
v) Identify Effective Marketing Channels
There is no one-size-fits-all approach when it comes to identifying effective marketing channels for individual business types. That’s why it’s important to conduct research on your target audience and find out the channels they use most frequently.
For B2B companies, LinkedIn is one of the most popular marketing channels. This platform allows businesses to showcase their expertise and connect with other professionals in their industry.
On the other hand, if your business targets younger demographics or wants to build brand awareness quickly, influencer marketing can be an effective option. A recent survey found that influencer campaigns generate $6.50 in earned media value for every dollar spent.
vi) Build a Diverse Team with Powerful Skills
Building a capable and motivated team is crucial for business success. Hire employees with the right skills, experience, and cultural fit. It’s also important to provide proper training, motivation, and recognition to retain and develop talent. Foster a positive work culture that encourages collaboration, innovation, and growth.
Diversity not only brings different perspectives and experiences to problem-solving, but it also helps businesses better understand and serve a wider range of customers. For example, if your company serves a multicultural community, having employees who speak multiple languages or understand cultural nuances can help build stronger relationships with customers.
In addition to diversity, having a team with powerful skills is crucial for adapting to changing customer demands. Skills such as data analysis, digital marketing, and communication are becoming increasingly important in today’s fast-paced market.
vii) Mind Set of Adaptability
The business landscape is constantly changing. So it is important to stay agile and adapt quickly to new trends and developments.
You should continuously monitor market trends and adjust your business strategies accordingly. Embrace innovation, learn from failures, and respond positively to meet up evolving customer needs.
These are the common concerns for any type of business. By addressing these factors, you can increase the chances of success for your business. However, depending on a specific niche, you may add or subtract some attributes to this list.
Let’s assume, you’re living in Chicago, USA, and thinking of starting a new business. Undoubtedly, with excitement, you are worried about thousands of things. Believe me, this is the store of every entrepreneur. But you are lucky to have so many helpful resources in your hands.
Special Note: COVID-19 pandemic created a difficult situation for us. Such as lockdowns, mass layoffs, mental depression, and many more. But it opens a lot of new doors as well. It introduced the remote work culture, popularized online shopping, and made people more comfortable with digital tools. All you need to cash these opportunities in your favor.
Finding gaps in current solutions, you can bring an innovative business model to thrive in this economic recession with a great profit.
A Case Study: How Groupon Survived an Economic Downturn
As we’ve said, a recession will bring new opportunities if you can find a potential gap among available solutions and fill it with essential elements.
Groupon followed the same rule.
Groupon is an American global eCommerce marketplace. They take the responsibility to connect subscribers with local merchants by offering activities, travel, goods, and services in 15 countries. Since they started, their growth rate is going high day by day.
However, they started their activities in the middle of the Great Recession, 2008.
In order to thrive during hard times, Groupon allured their customers with attractive discounts. Since customers are trying to cut costs during recessions, people grabbed this chance eagerly. And it gives a great boost to Groupon’s sales growth.
Running an eCommerce website? Check 20+ eCommerce growth strategies for 2023.
Highlight Your Dream: Running a Business is Far Bigger than Doing Jobs
Entrepreneurship allows individuals to have control over their own work and financial outcomes. You can set your own working hours and extend the possibility of earning a lot of money.
Forbes reported that 82% of entrepreneurs feel satisfied with their decision to start a business compared to working for someone else’s company.
Owning a business can lead to financial success. As successful entrepreneurs often make significantly higher incomes than employees at established companies.
No doubt there are risks involved in starting a new venture. But with proper planning and execution, it can lead to greater rewards both personally and financially compared to traditional employment opportunities.
So, Is It The Right Time To Start a New Business?
There has never been a better time to start a business than right now. The current economic climate brings unique opportunities for entrepreneurs who are able to adapt and innovate in terms of adversity.
With low-interest rates, government support programs, and an increasing demand for digital solutions, the chances to succeed get higher.
However, it is important to remember that starting a business is not easy. It requires hard work, dedication, and perseverance. But if you can make the required efforts then the rewards can be significant both personally and financially.
Are you confident enough to start your entrepreneurship journey? Share your thoughts with us in the comment section below!