During recessionary times, certain industries and business types tend to be more resilient and can even thrive due to changing consumer behaviors and economic priorities.
Here are some industries and businesses that often do well during economic downturns:
- Discount Retailers: When consumers are looking to cut costs, discount retailers tend to attract more customers. People look for bargains and lower-priced alternatives.
- Fast Food and Quick-Service Restaurants: During recessions, people might dine out less, but they still opt for cheaper dining options, such as fast food and quick-service restaurants.
- Healthcare Services: Healthcare services are essential, and people continue to seek medical attention even during tough economic times. Companies providing healthcare services often remain stable.
- Utilities: Utilities such as electricity, water, and gas are necessary regardless of the economic situation, making utility companies relatively recession-proof.
- Education and Training: During recessions, people often invest in further education and training to improve their skills and remain competitive in the job market.
- Repair and Maintenance Services: Instead of buying new items, people tend to repair and maintain their existing possessions, leading to increased demand for repair services.
- Debt Collection Agencies: In economic downturns, the number of individuals and businesses struggling with debt increases, leading to a higher demand for debt collection services.
- Alcohol and Tobacco: Some studies suggest that sales of alcohol and tobacco products tend to be stable or even increase during recessions, as people might turn to these products as a way to cope with stress.
- Pharmaceuticals: Pharmaceuticals and healthcare products are typically in demand regardless of the economic climate, making this industry resilient during recessions.
- Online Retail and E-Commerce: While brick-and-mortar retail might suffer, online retail often does well during recessions as consumers look for convenient and potentially cheaper ways to shop.
- Food and Beverage Industry: While high-end restaurants might see a decline in customers, more affordable dining options, especially those offering takeout and delivery, tend to perform better.
- Entertainment and Streaming Services: People tend to cut back on expensive outings and opt for more affordable entertainment options, such as streaming services and online gaming, during economic downturns.
- Home Improvement and Renovation: Instead of buying new homes, people might invest in renovating their existing homes, leading to increased business for home improvement companies.
- Security Services: Concerns about safety and security often persist during difficult economic times, leading to increased demand for security services.
- Government and Public Sector Jobs: Government jobs, especially in essential services like healthcare, education, and public safety, tend to remain stable during recessions.
Remember, the playbook for a lot of these lower-margin businesses is to capture market share and to do so with efficiency. If you can show how you do both things - help win market share AND with an appealing cost profile (the math still has to make sense).
And we were talking about this in June of 2022 btw. While the rest of the industry gaslit you into "everything is great, never been better!" and continue to tell you everything is fine.
Want to find out what we were saying over a year ago about the imminent recession?
What do recent Google searches reveal about the recession? And how can you prepare?
The Recession Ahead and How to Prepare
https://www.theoohinsider.com/the-recession-ahead-and-how-to-prepare/
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-Tim
