What was your business venture's net profit margin in the previous fiscal year? Was the projected revenue reached? Is cash-flow adequate and are you able to manage your accounts payable? Were you able to buy decent medical and dental insurance? Were you able to deposit $ 5K or more into your retirement account? Could you afford to take a vacation this year? If the answer to two or more of those questions is no, I respectfully suggest that you evaluate the future of your business or consulting venture.
If paying bills is often a stretch, if you can barely afford even the least costly health insurance, you infrequently (or never) pay into your retirement fund, if sales revenue has been lackluster for most of the past eight quarters, then it's time to make a change. Your best option may be to not just tweak your business model and engineer a pivot but to explore another type of venture altogether, one with greater profit-making potential.
Sageworks, a financial data service located in Raleigh, NC, analyzed the net profit margins of 16, 000 small businesses that earned less than $ 10 million between September 2014 and August 2015. The average net profit across all industries in that time period was 7.2%
Surprisingly, the list of top performers consists almost entirely of Solopreneur friendly service industries. Despite the challenges of selling services, especially intangible services to B2B or B2C clients, Sageworks' list demonstrates that it is possible to make money as a self-employed service provider.
While educational degrees and professional credentials pose a formidable barrier to entry for several of these high-yield businesses, others require only a much more attainable certification and license to do business, plus the right relationships to help you build a solid client list.
To enter and build your current business, you drew upon certain of your competencies, professional experiences and relationships and you may have developed additional skills over time. For example, all self-employed professionals must become proficient at sales. That is a skill you can transfer to another venture, such as real estate sales.
It is almost certain that you have competencies that have lain dormant as you pursued the opportunities available to you at the time. Look over old resumes and remind yourself of previous job responsibilities and positions you held while serving on a not-for-profit board or committee.
Did you chair a finance committee or serve as a board treasurer? Were you responsible for preparing monthly financial statements at one or more places of employment? Those experiences could help you repackage yourself as an independent bookkeeper who works with small business clients. If billing and other administrative functions formed the core of one or more of your previous jobs, you may be able to bundle those services and present them as a high-profit business that you can operate from a desk in your bedroom.
Whichever of your skill sets that research shows has the potential to propel you into a new business venture, update and deepen that knowledge with a couple of courses at a community college, or with free online courses at Coursera or Massive Online Open Courses (MOOC) . If you'd like to receive a certificate from the school that sponsors your course, it will cost less than $ 100. Check the list of high-profit businesses below and see how your skills and professional experiences might successfully be applied.
Business Net Profit Margin
Accounting / Bookkeeping 18.4%
Real estate sales 15.2%
Lawyer's office 14.5%
Dentist's office 14.4%
Health practitioners (chiropractors, etc) 13.3%
Physician's office 13%
Business or technical consulting 12%
Graphic and industrial design 11.4%
Administrative services (billing, etc.) 11.3%
Architectural / structural engineering services 11%
Real estate property services 10.1%
(landscaping, cleaning, etc.).
Thanks for reading,