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The year 2020 was a massively tough year for most businesses. Between the COVID-19 pandemic and the accompanying economic roller coaster, many businesses were either shattered or barely stayed afloat. Even businesses that thrived often had to execute extreme changes to their business models. However, in 2021, a new day is dawning for new business as the COVID-19 vaccine is rolled out.
The U.S. will, hopefully, soon be open for business in person again. Even as the pandemic continues to pose challenges, many online businesses are performing strong numbers and making big plans for growth. If you’ve been contemplating starting a new business in 2021, now is the perfect time to get your plan together and apply for a business license, business bond, and other essentials. Why? Here are five reasons that new businesses could find ways to thrive in the new year.
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1. E-commerce Businesses Are Poised for Another Year
Many eCommerce businesses were experiencing strong growth even before the pandemic, and 2020 turbocharged that phenomenon to the tune of 30% year over year market growth. There’s no real reason to think that eCommerce will see anything but more growth for new business in 2021, even if it doesn’t increase as explosively as it did in 2020.
Today’s entrepreneurs are flocking to eCommerce not just because of its massive growth, but also because of its relatively low start-up costs and easy-to-use platforms like Shopify. Business models like the tremendously popular drop-shipping, in which an entrepreneur never has to store or handle items themselves, have made it easier than ever to start an online business with not much more than a computer and a bank account.
Even more so than in other sectors, the secret to success for a new eCommerce business will be finding a niche. Giants like Amazon and Walmart already play the mega-retail game better than anybody else. So, start by thinking small and looking for specialized opportunities. Hand-crafted goods, niche collectibles, and reselling are great examples. There are abundant opportunities for playing the kind of small game that can turn into a successful eCommerce business.
2. Demand for In-Person Experiences Will Rise
The pandemic has been nothing short of a disaster for the hospitality industry, with thousands of bars and restaurants closing permanently. Brick and mortar retail has weathered tough times as well. Yet, once the vaccine has helped right things somewhat, many consumers likely will be craving the in-person experiences that they’ve largely had to abstain from for over a year.
Aspiring restaurateurs, bar owners, shop owners, and other purveyors of in-person experiences stand to benefit from the impending return to going out. Although it’s hard to predict exactly what will come, experiential consumer attractions like pop-up bars, themed restaurants, and VR experiences are likely to come roaring back to an entertainment-starved populace.
Of course, things won’t just be going back to the way they were if you were to start a new business in 2021. In-person businesses will have to change and accommodate the new normal, including finding effective ways to follow safety precautions while the pandemic remains a threat. And, as we’ll discuss next, these changing times will produce the greatest commodity of all: innovation.
3. Different Sectors Will Be Ripe for Innovation
Recovery periods after disasters frequently offer opportunities to disrupt old models and build new ones. Thus, if you’ve got an innovative business idea you think could succeed, 2021 might have the opening you’re looking for.
Many experts are predicting a so-called “Great Reset”. This means old business models can be wound down and new ones can begin to grow and thrive. There’s abundant precedent for this. The Great Depression of the 1930s produced many important advances in materials science. However, the Great Recession of the late 2000s and early 2010s spawned many startups that are now household names. For example, Airbnb and Bitcoin.
This is one area in which fortune will favor the bold, so don’t hesitate to get started on your preparations. Learn about the big questions you’ll need to answer: “How much initial capital do I need to get started? What are the requirements for getting a business license in my state? What is a surety bond?” The sooner you find the answers, the sooner you can take the plunge and seize the chance to create something new.
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4. Labor Pool Will Be Full of People Looking to Get Back to Work
Unemployment remains devastatingly high as we enter 2021. That means, depending on which industry they’re in, new business owners may have a substantially larger than average labor pool to work with when hiring.
Skilled workers of all kinds who’ve had trouble finding work will be eager to return. People who’ve stayed in jobs they don’t like due to economic uncertainty will likely begin to explore their options more. Also they will seek work that suits them better and which offers improved benefits. Employers who can provide fulfilling work for good pay will find that workers are willing and able.
However, understanding the realities of the 21st-century labor market means innovating along with workers. It also means involving them in the leadership of the business’s ground-level operations. It also includes offering living wages and healthcare benefits that allow workers to provide for their families and take care of their health.
5. The Real Estate Market Could Be Ripe With Opportunity
For years, the trend of increasing urbanization and consolidation has made it tough for new businesses to afford prime urban core real estate as deep-pocketed players snapped up prime spots. Now, some of the real estate markets that were once America’s hottest have dropped precipitously in price. This created many potential opportunities.
That means that new businesses in 2021 may have a slightly easier time finding a place to set up shop. No one celebrates the closure of thousands of businesses. However, it does clear the way for new businesses to find the perfect spot in newly vacant commercial real estate. Commercial landlords will be in search of new tenants for their spaces. So, businesses that act quickly and know what they’re looking for could be able to score an excellent price.
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