The 15 Most Profitable Small-Business Industries
August 22, 2017 by Rose Leadem
Thinking about launching a new businesses? Here’s where to look to for high profit margins.
While a number of small businesses flop in their first year, a safe way to help your new venture be a success is by tapping into the right industry.
From accounting to legal services to real estate – there are certain industries that tend to see higher profits than others. By analyzing net profit margins of privately held companies over the past 12 months, financial information company Sageworks sought to uncover exactly which industries are the most profitable.
For the second year in a row, accounting and tax services takes the cake for the most profitable industry. Real estate, legal services and management of companies and enterprises follows closely behind, also landing on the top of the list for most profitable types of small businesses.
“Many of the top performers are service industries in which certifications and education requirements are barriers to entry,” Sageworks analyst Libby Bierman said in a press release.
However, that doesn’t mean other major industries didn’t see higher progitability over the past year either. From healthcare to manufacturing, check out this year’s list of the most profitable industries for small businesses.
1. Accounting, tax preparation, bookkeeping and payroll services
Finances are a part of everyone’s lives, so here’s an industry that will remain important no matter what. Not only that, but these types of businesses don’t need to purchase or maintain any expensive equipment, thus have few overhead costs.
2. Lessors of real estate
Up from eighth place last year, lessors of real estate – also know as landlords – made its way to second place on this year’s list. While purchasing land can be costly at first, renting it out to people or companies has major benefits and is a great way to bring in the big buck – especially during a time when many people are turning in to renting instead of buying.
3. Legal services
Like accounting and taxes, here’s another industry that requires specialized training and certifications. While you may have to invest in degrees in training, you can charge a considerable amount for specialized services.
For the full story featuring Sageworks, visit Entrepreneur – The 15 Most Profitable Small Business Industries