What's Hot and What's Not
Don't rule out the possibility of a franchise as your business venture. A franchise agreement means that you get to sell a trademarked product or service, such as Pizza Hut pizza or CleanNet USA maintenance services. In exchange, you give the franchiser a percentage of every sale.
Once you've figured out what type of business makes sense for your personality and circumstances, you'll need to see what makes sense from a business perspective. It makes no sense to sink your resources, both financial and otherwise, into a venture that has little chance of succeeding.
With the digital camera market growing by leaps and bounds, for instance, it's not a good time to open a traditional photo developing facility. You should gear your search toward growth industries—those that are expected to expand significantly in the coming years.
There are several ways to identify growth areas. One is to simply take a look around and see what's been popping up. If three new coffee shops have opened in your town during the past year, and every one has a line of people out the door every morning, you may assume, correctly, that coffee is a growth area.
But don't take our word for it. Walk into your local department store and check out the housewares department. We've come a long way since our Mr. Coffee machines of the 1980s. You'll see cappuccino makers, espresso machines, seven kinds of fancy European coffeemakers, bean-grinding machines, and on and on.
A stop in the gourmet food section will reveal all sorts of coffees and coffee-related items, such as chocolate-coated stirring sticks, flavored syrups, and biscuits specially designed for dipping.
If you leave the department store and look around your community, you'll notice the fancy coffee vending areas in convenience stores, and the expanded coffee menus in restaurants and sandwich shops. It should be pretty clear that coffee is a growth industry.
If you're not comfortable with identifying growth industries on your own, you can get an idea of what's out there from government statistics. The Bureau of Labor Statistics has identified the following jobs as the 10 fastest growing occupations during the period between 1998 and 2008:
Remember that service jobs, such as housecleaning, catering, and dog grooming, are on the increase, and are expected to be even more in demand in the future. We're a busy bunch of folks in America, looking for people to do the chores we don't find the time for.
Computer support specialists
Desktop publishing specialists
Paralegals and legal assistants
Personal care and home health aides
Social and human service assistants
There you have it. Computers, law, and health care are the professions of the future. If you're thinking of starting your own business, and you happen to be a computer whiz, you shouldn't have much trouble deciding a job area in which you have a good chance of being successful.
What happens, though, if you don't have the slightest interest in computers, you don't want anything to do with lawyers, and you can't stand the thought of being around someone who's sick?
You simply don't gear your business toward any of those fields, that's all. Just because a job or industry has been targeted for growth doesn't mean you have to—or even should—jump on the bandwagon.
It's far more important to find an industry in which you're interested and comfortable, than to try to mold your entrepreneurial efforts toward an area targeted for growth. Consider your interests, your family and personal situation, and what your instincts tell you about the sort of business you should start.
Then be prepared to trust in yourself and make your dream come true.
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Excerpted from The Complete Idiot's Guide to Personal Finance in Your 40s and 50s © 2002 by Sarah Young Fisher and Susan Shelly. All rights reserved including the right of reproduction in whole or in part in any form. Used by arrangement with Alpha Books, a member of Penguin Group (USA) Inc.
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