Analysis

10 Most Profitable Types of Small Businesses When You Have Little Capital to Invest

Have a talent for nothing but those little numbers? That’s actually a good thing! Even though art and creativity is all the rage these days, it has been reported that numbers are still in the front row when it comes to profitability in the small business sector.

According to the recent list released by Sageworks, a company that analyzed over 16,000 small business and their models, accounting and financial services made the top of the list. The reason? This is the only type of business that runs solely on human capital. Any service industry will always be one step further than any manufacturing industry simply because the former requires very little material input. Additionally, humans seldom need special working conditions when it comes to offering their services- this type of industry easily kicks off even from the garage at your home!

Here’s a better look into the list and its findings:

  1. Accounting, Tax Preparation, Bookkeeping and Payroll Services: 18.4%

This little industry made it to the top of the list by being the most profitable. However, according to Sageworks, this isn’t surprising because accounting makes it to the top fairly regularly, the reason being the low capital cost and an interminable need of an accountant whichever way the economy might be swinging. This industry tends to have low overhead costs as well as a low number of repeat clients.

  1. Management of Companies and Enterprises: 15.5%

This industry consists of smaller privately-owned offices of bank holding companies along with other holding companies.

  1. Real Estate Agents and Brokers: 15.19%

While it’s true that the real estate industry is dependent largely on economic factors, the industry itself needs very little starting capital. In fact, all you need to kick off is a real estate or brokerage licence.

  1. Automotive Renting and Leasing: 14.55%

Nowadays people are more into renting and leasing cars than they are in actually owning automobiles. It’s convenient and requires less capital. This is why this industry has made it to the 4th position on this list.

  1. Legal Services: 14.48%

If you’ve ever had any reason to hire a lawyer, you know they don’t come cheap. This is why, if you have the proper licensing and education, you can open your own small business in this field and offer reasonable costs while still making a pretty penny. This, of course, doesn’t just include lawyers but also notaries, settlement officers and the likes as well.

  1. Dental Practices: 14.41%

Dental practices have some of the highest number of recurring consumers in the world. Which isn’t a surprise since you should visit your dentist every 6 months or so. Even though the initial setting up costs are a tad much and you need a lot of med school to actually become a licensed practitioner, the plus side is the fact that you get to have more than a couple of clients at any given time, and many of them pay in cash.

  1. Electric Power Generation and Distribution: 14.02%

This might seem a little out of your scope to many people but there’s gold in them fossil fuels! But not just black gold. Geothermal, hydroelectric, wind, solar and nuclear energy are also very promising for the small businessman who wants to just invest.

  1. Lessors of Real Estate: 14.01%

Yup, we already covered real estate somewhere up there but this isn’t real estate in that sense. This real estate section is about becoming a landlord and renting out some part of your property to anyone looking for a place to live, work, etc. it’s a pretty profitable investment once you recover the initial costs of purchasing.

  1. Other Health Practitioners: 13.30%

We aren’t talking about your general physicians here. This category is for your psychologists, physiotherapists, chiropractors, optometrists and other directors who have decided to sway slightly from the mainstream of medicating the human body.

  1. Health Practitioners: 13.01%

The downside here is that it’ll take you years of studies, licensing, practicing and med school debts to get at this point, but if you made it, hey! There’s a lot of money to be made in private practice so why not?

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