Starting any business is hard work, but there are certain businesses that are extremely challenging to successfully establish and sustain. You’ll want to avoid these industries unless you are truly passionate about them, willing to learn everything you need to know, and prepared to tough it out for success. Here are the four hardest businesses to start and what you need to know about them:
Despite what recent successes like Uber and Lyft may lead you to believe, the transportation industry is a challenge to break into. A transportation business drains your money and the industry is already saturated. Prepare for high insurance premiums and an unpredictable cost of fuel during oil spikes. Depending on the area you live, a license is expensive as well. For example, a taxi license in New York City can cost upwards of $400,000+. There is also a lot of competition in the transportation industry, so finding and maintaining loyal customers is an uphill battle.
If you’re passionate about food, the thought of starting your own restaurant is exciting. Although owning a restaurant is a rewarding venture, it’s one of the most difficult businesses you could start. For one, the expenses add up. You’ll need to buy restaurant equipment, from either a local supplier or online retailer like Budget Restaurant Supply, the dining room needs to be furnished, and you’ll need an expensive liquor license if you plan on serving alcohol. It’s also not easy to pass the health code; it typically costs restaurants thousands of dollars to maintain their restaurants in compliance with the health code. And all these expenses are before staffing, supplies, and rent are even considered. Starting a restaurant is an all-or-nothing venture.
Social Media Sites
Who dominates the social media space? Facebook. You can easily answer that question without ever having read social media statistics. Facebook has over a billion active users. You have stiff competition in the social media industry as small startups Ello and Peach can attest.
You’re most likely not going to become rich opening a grocery business. The problems with starting a grocery business are high product costs, low bargaining power, small profit margins, and high competition from established, trusted grocers. That word “trusted” is a major obstacle for new grocers. Trust is imperative in the industry. Consumers care about the safety of their food and where it comes from. If they’ve never heard of your brand before, they will be cautious about it. Why would they go to an unknown grocery store when they can shop at their regular grocer that they already trust?
You’ll notice common themes in the hardest businesses to start: high competition, big expenses, and a steep learning curve. These factors don’t mean you shouldn’t start a business in that industry, but you really need to be strategic, differentiate yourself, and develop a good plan for making a space for yourself in that difficult market. If there is a niche that you can fit in, take advantage of that. As with any business, though, don’t expect to go toe-to-toe with the big players, not just yet.