What kinds of small businesses/self employment are most (or least) likely to succeed? I realize this is somewhat subjective - for instance what does one mean by succeed - and I’m sure it varies by location and by how the economy’s doing at the time - but there must be some statistics out there.
Kalashnikov - I think few of the successful self-employed / small business owners would have time to respond to your post – they’re all at work.
Well, there is that old “lawnmower” story. But everyone that I know (probably half) whose tried to not get a job has wound up getting a job. And a lot of IT’s have wound up hiring on. Remember the “consultants”.
Don’t let that discourage you though. Good luck.
I’m kinda reluctant to respond, since I don’t have any hard numbers or studies for you – just my general experience and common sense.
However, IMHO, the small businesses that are most likely to fail are the sexy ones - such as restaurants, country inns, and dot-coms. Folks fantasize about setting up these businesses and it clowds their judgment, perhaps.
On the other hand, low-overhead service businesses, such as cleaning services, are more likely to succeed since you don’t have a huge monthly bill pounding away at your capital.
Just MHO of course.
In relation to this, who out there owns a franchise of some sort? I know they are pricey to get into sometimes for even a typical sandwich shop, but how long before you start seeing profits?
How much money would it take say to open a Subway in your typical mall and how many years till you get out of the red one sub at a time?
The book The Millionaire Next Door provides support for lucwarm’s position. A lot of the millionaires they profiled are small business owners in plain, no-frills businesses.
I looked into a couple of franchises. Wienerschnitzel, for one. About $200k to start, and they remain the “boss”. My daughter looked at one of those mall cart things. It sucked, IHHO. In mine too. Check into a 7-11 sometime. In all the franchises I looked at the parent company ultimately held the reins. And you held most of the risk.
My brother tried janitorial a few years ago. As soon as he hired his 2nd employee the big agencies came in undercut his prices.
Many of the common SB’s, janitorial, landscaping, delivery and the like, are very cutthroat.
Some folks do pretty well on the flea market circuit, but you might have to be a little bit of a bad-ass to keep from being pushed out.
You can always marry Roseanne. 
I gave up and kept my day job. Roseanne wasn’t available at the time. 
The smart way is to find a niche market on the upsurge or figure out what it is about your situation that can give you an edge. If you are still in business after four years, you’ve done it. It is imperative that you have the services of an accountant who knows the tax code. At 41%, deductions are the way to survive. Undercapitalization is usually the reason most go under. Try it part-time if possible. Be ready to adjust to a lower lifestyle. My feelings are that a service to people with more money than brains would have potential. Like professional Feng Shui for houses and buildings…
It seems to me that one needs to pick a business where the economies of scale are on your side.
As a negative example, a small bookstore would be very risky since Borders or Barnes & Noble could crush you (unless you carry porn).
On the other hand, let’s suppose you have a service where you mow peoples’ lawns in the summer; shovel their driveways in the winter, etc. I suspect that if you are reasonably conscientious and responsible, you’ll do great.
In my experience, it’s not all that difficult to make being an owner-operator of a taxicab work. It takes time, but the formula for success isn’t all that tricky.
I did it while I went to college. While most indies didn’t do this, I culled through the ranks of the available drivers and got a couple of reliable guys to keep it rolling around the clock, when I wasn’t driving (hint: keep Friday night for yourself).
Although I didn’t do this, it certainly occurred to me that I could hire one more guy to take my shifts and then go to work on getting a second cab, which I could drive myself while I worked on staffing it up. Lather, rinse, repeat.
After 5 or six years, when you’ve got 9 or 10 cabs rolling, you may well be able to afford to hire an administrative assistant to handle most of the paperwork, scheduling, etc. that you will be busy with by then (having, at that point, driven your last shift many moons ago).
And you’ll have all kinds of stories to tell!
If you think you can order a shrink-wrapped business, open the box, add water, and succeed, you don’t have a chance. Many small business owners inherited their business. I would say that’s the number one way to succeed. If that’s not feasible, then your second choice should be a business that you have worked in for years, have extensive knowledge of the industry, and most importantly, have a cache of potential clients. All IMHO of course.
If your serious about this question (as opposed to asking out of curiosity) read E-MYTH REVISITED by Michael Gerber (I think). One of the big things it talks about is that if you try to open a bussiness based on something your good at, it’s going to end up in the crapper. ie If your GREAT at making pies, it does not in any way, shape, or form mean you can open a pie making bussiness and do well. Although you could probably work IN a pie making bussiness quite nicely. I really can’t go into the details without re-reading the book, but it really does make a lot of sense.
Also the bussiness that do well are the ones that find a niche and…fill it.