Businesses That Never Fail? 12 Businesses with Amazingly Low Failure Rates [Backed by Data]

Summary

This video highlights recession-proof business ideas, focusing on industries that remain strong during economic downturns, such as beauty and personal care. The speaker discusses low-cost beauty services like salons, nail studios, and affordable cosmetics, which thrive during recessions, a phenomenon known as the 'lipstick effect.' Business owner Lillian Lad shares her experience running 'Lovely Liies,' a beauty business that stayed resilient during COVID and economic uncertainty. The video encourages entrepreneurs to consider starting businesses during tough times, emphasizing that some industries, like beauty, can thrive no matter the market conditions.

Takeaways

• 😀 Starting a childcare business, either from scratch or by purchasing one, can be a low- to high-cost but recession-resistant venture.
• 😀 Beauty and personal care services, such as budget-friendly salons, nail studios, and low-cost cosmetics, tend to perform well even in economic downturns.
• 😀 The 'lipstick effect' explains that during recessions, sales of small, affordable luxuries like lipstick and nail polish often increase as people look for small ways to treat themselves.
• 😀 The 2001 and 2008 recessions showed a rise in sales for low-cost beauty products, such as lipstick and nail polish, contrary to expectations of decreased spending.
• 😀 Despite economic downturns, beauty services like haircuts, manicures, and pedicures continue to attract customers who want to look and feel their best.
• 😀 Lillian Lad, owner of Lovely Liies, shared her experience of maintaining consistent client visits during the COVID-19 lockdown, demonstrating the resilience of beauty businesses during tough times.
• 😀 Even though the economy may be uncertain, people still prioritize personal appearance and wellness, making beauty businesses somewhat recession-proof.
• 😀 Starting a business during a recession can be a smart move, as long as you find the right niche that remains in demand, even during economic struggles.
• 😀 Baron Rothschild's famous quote, 'Buy when there's blood in the streets,' implies that recessions can present opportunities for businesses willing to take calculated risks.
• 😀 Recession-proof businesses focus on products and services that people need or want regardless of the economic climate, offering a strong foundation for long-term success.

Q & A

What is the main theme of the video script?

The main theme of the video revolves around businesses that can thrive even during economic recessions. The speaker discusses various types of businesses that remain resilient during tough economic times and highlights strategies for success in such periods.

What is the 'lipstick effect' mentioned in the video?

The 'lipstick effect' is a theory that suggests when the economy is struggling, consumers still spend money on small, affordable luxuries like lipstick, nail polish, or minor beauty treatments. The idea is that people may cut back on large expenses but still want to indulge in small ways to feel better about themselves.

Why do beauty and personal care businesses perform well during recessions?

Beauty and personal care businesses, such as salons, barbershops, and nail studios, perform well during recessions because people continue to seek ways to look and feel good, even when they have less money to spend. These services offer relatively affordable ways for people to indulge in self-care.

What role does the 'customer is always right' principle play in recession-proof businesses?

The principle of 'the customer is always right' is often emphasized in recession-proof businesses because customer satisfaction becomes even more crucial during tough economic times. By ensuring customers feel valued and cared for, businesses can maintain customer loyalty and keep their operations steady, even in difficult financial climates.

How did Lillian Lad manage her business during the COVID-19 lockdown?

Lillian Lad, the owner of Lovely Lies, shared that even during the COVID-19 lockdown and fears of a recession, her business remained consistent because she still saw two to three clients a day. She attributes this to the fact that people still want to feel their best, which makes beauty and personal care services recession-resistant.

What is the significance of Baron Rothschild’s quote mentioned in the video?

Baron Rothschild's quote, 'Buy when there's blood in the streets,' suggests that economic downturns and crises can present opportunities for success, especially for those willing to take risks. The speaker applies this mindset to starting a business during a recession, arguing that tough times can offer a chance to thrive if approached strategically.

How does the recession impact consumer behavior in the beauty industry?

During a recession, consumer behavior in the beauty industry changes in the sense that people might reduce spending on luxury or high-cost items but still invest in small, affordable beauty products or services. This is partly due to the 'lipstick effect,' where people still want to look good and feel better, even in difficult financial situations.

Why does the speaker consider beauty businesses 'recession-proof'?

The speaker considers beauty businesses 'recession-proof' because, even in economic downturns, people continue to prioritize self-care and beauty routines, often opting for affordable services. The consistent demand for these services ensures that businesses in this sector can weather economic challenges.

What does the video suggest about the future of recession-proof businesses?

The video suggests that recession-proof businesses, particularly in industries like beauty and personal care, will continue to perform well in the future. It emphasizes that even when the economy is struggling, people still seek ways to feel good about themselves, which supports the sustainability of these businesses.

How can aspiring entrepreneurs benefit from understanding recession-proof businesses?

Aspiring entrepreneurs can benefit by recognizing industries that are less affected by economic cycles, such as beauty, healthcare, and essential services. By focusing on these areas, they can build businesses that remain stable during recessions and continue to attract customers, even in challenging times.