Like the grocery category, personal care items are great to resell, if you can find a steady source of inventory. This is a broad category that includes everything from basic staples like bread and milk to more specialized items like frozen meals and snacks. Food is always in demand, so it’s a good bet for a recession-proof business. Consumers will want to spend their money on essentials without going overboard on categories such as groceries, especially since the cost of nearly every item sold has increased in 2023. It is no secret that many other goods consumers need for their everyday lives have increased in price.

With some effort and thorough research, you can identify which recession-resistant business will be most suitable for you. However, it’s also crucial to consider your mental, emotional, and financial preparedness for doing business during an economic downturn. Once you have a clear understanding of your capabilities and have taken the necessary steps to prepare for the challenges ahead, you’ll increase your chances of success, regardless of the state of the economy.

Top 10 Recession‑Proof Businesses

Worldwide, the financial services market grew from $2.5 trillion to $3.3 trillion between 2010 and 2018. During the Great Recession, universities in the United States saw considerable increases in enrollment. Between 2007 and 2010, there was an almost 16% increase in the number of students enrolling in college.[7]The Hechinger Report. While other industries suffered immensely, academia experienced a notable increase in students. Evidence suggests education is a recession-proof industry despite its high expense in the United States. When a portion of the workforce is laid off—which so often occurs during a recession—many individuals return to school to develop their professional skills, creating a demand for post-graduate degrees.

So, it’s safe to say we’ll likely continue seeing utility profits soar within the next few years — making the overall industry a safe bet for business owners. While many utility companies are public, some — like some green energy and solar panel companies — are private and can be a smart option for small business owners. As of 2022, the U.S. utilities industry market size is over $960 billion — and the global utilities market is expected to reach $8.10 trillion by 2026.

If you’ve ever wanted to take your baking and candy making skills to market, you’ll be happy to learn that these types of small indulgences are boosted when recessions happen. Starting a small corner candy shop or a donut shop might keep the lights on and the bills paid up whenever a recession happens to shock the economy. You’ll be surprised to learn that in the US, candy consumption skyrocketed during the Great Recession. A report by the New York Times found that Cadbury’s profits were actually up 30 percent in 2008, and Nestle experienced a sizable 10.9 percent growth. Since ongoing costs can be kept low, an information technology firm can easily turn into a high million-figure opportunity. Starting a convenience store is an excellent business venture for individuals who have a good location in mind and who enjoy working with the public.

In many cases, central banks lower interest rates during recessions, which makes capital cheaper and encourages investment. The availability of more affordable mortgages can positively impact the housing market, as increased financing accessibility can expand the pool of potential home buyers. While the Great Recession occurred due to a property market crisis, not all recessions have had the same impact on home values. The Dot-Com Recession (2000) and the Gulf War Recession (1991) had barely any impact on the housing market.[5]The Balance.

Software as a Service (SaaS)

Gas, water, electricity, and telephony needs do not change during a recession. These industries are also ones that gain a cloak of recession-proof protection from their linkage to government regulation, which can either provide subsidies or limit outside competition. Creating addiction is a taboo subject, yet many businesses seek to create such a euphoria about their offerings with users in the hope of creating inelasticity. Internet businesses have ramped up consumer intelligence and behavior monitoring to very elaborate levels. You could look products like social media, the infinite scroll, and in-app purchases in games, as a means of creating addictive loyalty. Luxury goods, despite the high price tag, are surprisingly resilient to recessions.

As you bring more money into the business, you can add more products to your line, helping you scale more sustainably and with demand. For example, Glossier started out with only 4 products, and has now become a billion-dollar beauty brand. Passion is certainly important when it comes to starting your own business, and it’s equally important to examine historical data to forecast how your business might perform during a recession. Pause and consult with financial experts, your accountant, or mentors before making any big business moves that could increase monthly expenditures.

Recession-Proof Business Models

The general understanding is that two consecutive quarters of negative growth in an economy constitute a recession—and that negative growth can utterly decimate once successful businesses. However, some businesses are considered “recession-proof” because they typically withstand the impact of recessionary economic conditions. Tony and other successful entrepreneurs and business owners give you the tools and strategies you need to survive in any economic climate.

No matter what the economy is doing, digital marketing such as SEO, SEM, social media campaigns and email marketing will always be one of the most cost-effective ways reach new customers. The enduring success of the beauty industry as a recession proof business is actually far less to do with vanity than might be expected. There are many items which are consumer staples such as toiletries whose sales remain steady Recession proof businesses during a recession. There are also several other types of retail which also does well even when the condition of the economy suggests people should be buying less. Freelancing has the potential to be one of the most recession-proof businesses in the world, even compared directly to many of the others on this list. Companies can save a lot of money by outsourcing certain tasks and activities to freelancers.

Recession-Proof Online Business Ideas

When things get tough, one of the first things people cut down on are new clothes. If you are looking at starting a business that can withstand a recession, then consider something that caters to kids and especially babies. Below are some specific industries that are resistant to recessions and are likely to support you even through difficult circumstances. Recession-proof businesses are usually in industries that are not severely impacted by a decline in the economy.

In 2021 alone, e-commerce sales totaled about $5.2 trillion globally, and they’re predicted to grow to $8.1 trillion by 2026. There are plenty of small businesses out there selling beauty products, but if you can find your niche, it can be an incredibly lucrative business. Whether you’re a small business owner, freelancer, or CEO of a major company, when it comes to taxes, you’ll probably need an accountant. From tax preparation to bookkeeping services, accounting is definitely a recession-proof business.

Least Recession-proof Businesses in 2023

However, not all businesses in this space perform well during recessions. In 2009, during the Great Recession, restaurant earnings as a whole were “dismal.”[3]New York Times. When cash flow stops, businesses turn to cash reserves, selling off stock, issuing bonds, or using their capital assets as collateral to secure loans. Yet loans also become harder to secure, stock prices can decline, and the real estate market sometimes goes stale, making property investments less profitable. If you want to start a business during a recession, choosing the right sector is key.

Here are some ideas for businesses that can survive and potentially even thrive in a poor economy. Christian Woodward leads the American sales organization and business unit for OutSystems. So, selling entertainment products like DVDs, books, puzzles, board games, and video games can be a good way to weather the storm. Consumers are looking for ways to cut back on frivolous spending and for ways to save money on their everyday expenses. The number one response — fun and impulse purchases — is not surprising. If you are selling products that would fall under this description, then it is likely that you will see a dip in your sales during a recession.

You might have noticed a consistent thread between the points on this list — recession-proof businesses revolve around necessity. Utility services, like home and car repair, comprise another key defensive, recession-resistant industry. Most people lack the necessary resources and knowledge to handle routine maintenance on their homes and automobiles — let alone major renovations, construction, or part replacements.

While people might cut back on restaurant dining and takeout when budgets are tight, they’ll still need core staples at their grocery stores — such as bread, cereal, milk and toilet paper. Industries that fulfill people’s essential needs are more likely to generate steady revenue during times of economic instability. Although launching a new business during a recession comes with certain obstacles, it could be worth it if you’re able to secure an income stream for months (or years) to come. It’s a bad idea to start a business during a recession if you have no prior experience. If it’s the right time for you, you have the competence, and you can line up customers to earn revenue, go for it. Whether you have both the time and the money to expand your product line, or you only have time to build your social media audience, start creating a recession proof business now.

But for a select group of professionals, a recession may actually be an opportunity to thrive and grow. A recession-proof business, however, will be prepared, by paying off debt, being ready to pivot, or avoiding deadly sins like giving in to fear. Traditionally we think of the three basic needs as food, water, and shelter. Real estate agents are experts in the housing business, and their connections and skills get properties sold. Agents are not easily replaced, and people always need houses, making real estate agencies another recession-proof industry.

While some may avoid these vices, consumers often rely more on these comforts to get by during economic downshifts. According to Guidant’s Hottest Fitness Franchises of 2022, the future of the fitness franchise industry looks bright. Over the past five years, public health initiatives have bolstered the industry, resulting in a U.S. market size of $35 billion and over 109,000 businesses. Fitness and health/wellness services include anything from gyms and yoga studios to wellness centers, teletherapy, and massage services. As an industry, gyms and fitness clubs are expected to grow by 4.2 percent in 2022, ranked as the 317th largest industry in the U.S. In fact, the global automotive repair and maintenance market is expected to grow from $750.84 billion in 2021 to $836.27 billion by the end of 2022 at a growth rate of 11.4 percent.

• Also, Cadbury reported record earnings in 2008 during the Great Recession of 2007 to 2009.
• And with less work, suppliers will be more willing to negotiate prices than in times of economic prosperity.
• What sells during a recession are goods and services with no practical alternatives or something customers aren’t able (or willing) to do on their own.
• When Matej Kukucka, founder of Marketing Player, worked for a customer service software company during the pandemic, he noticed a lot of growth.
• Rental agents, landlords, and property management companies can thrive during a recession, when renting is likely to become a more appealing option—if not the only option available.

When savings are slim, consumers forego purchasing luxury or new vehicles. But most consumers still need to maintain their cars — especially if they need that car for commuting to work, school, or grocery shopping. That’s why the automotive industry has proven to be historically recession proof.