The best businesses to start are those that are either low-cost, high-profit, low-competition, or trending. You also may want to look for a business that performs well during or after COVID-19 restrictions.
To compile this list, we reviewed market research by companies such as IBIS World, Statista, Bureau of Labor Statistics (BLS), and Grand View Research. We looked for businesses that are growing and expected to grow even more over the next several years.
Here are 21 of the best businesses to start in 2020:
1. Home Healthcare
A home healthcare business is when a caregiver or licensed health professional provides services in a patient’s home. Before coronavirus, market research firms predicted 7.8 million job openings by 2026 in the home healthcare industry—largely due to the rapid increase in baby boomers needing care. Because of the expected growth, it’s one of the least risky industries for starting a business.
Due to COVID-19, home healthcare workers are even more in demand to assist elderly who are sheltering-in-place. Additionally, many elderly are reluctant to enter nursing homes because of high coronavirus infection rates.
Home healthcare professionals provide medical assistance including meal prep, transportation, dressing, and housekeeping. Medical-based assistance (which requires a license) provides healthcare services similar to that in a nursing home setting or a hospital.
Overall, home healthcare is an appealing business because it’s relatively low-skilled and requires minimal training. You can grow the business with low-risk by building up your client base to the point where you can’t take on any more patients. Then, hire additional healthcare aids to continue patient growth.
2. Lawn & Landscaping Service
Landscaping and other “green” related businesses—tree care and outdoor services, have recovered relatively quickly after lockdowns and some were never shut down in certain states. Businesses that bounce back is something to consider when choosing a business to start.
A landscaping business is toward the top of this list because they are consistently in-demand, have relatively low costs, and are easy to launch. Once you fully pay off your equipment, it can be profitable. The landscaping industry often has companies that provide poor service, which gives you an opportunity to call on and potentially sign unhappy customers.
An easy hack to figure out which neighborhoods are ripe for landscaping opportunities is to go to Google Reviews and Yelp to see which businesses have low ratings (1- and 2- stars). Research what neighborhoods those poorly reviewed businesses serve, and hand out flyers in those neighborhoods. Be sure to do quality landscaping for your first handful of customers, and you’ll build a solid customer base quickly.
The costs to get started with a basic lawn care business are under $5,000 for equipment, licenses, insurance, and marketing. However, a larger landscaping company can cost over $100,000 when you factor in trucks, trailers, commercial equipment, and an office. With a well-functioning lawn care business, you should be able to pay yourself anywhere from $60,000 to $200,000 per year.
3. Commercial Cleaning
We have seen anecdotal evidence that commercial cleaning businesses are in demand during COVID-19 and one of the best businesses to start in 2020. And it makes sense. Companies want to make their customers safe by deep-cleaning their building interiors frequently.
One of the best ways to start a cleaning business is to buy into a franchise—they are traditionally low cost. With a franchise such as Vanguard Cleaning you’ll receive training, marketing, a proven business model, and support. You can get started with a cleaning franchise like Vanguard for under $40,000.
A cleaning business is also something you can start on the side or weekends. Once your client base builds up, and you cannot handle any more clients, consider hiring your first employees. It’s a low-cost and low-risk business to scale.
4. Solar Power Installation
Revenue from US solar power installation companies grew 39% from 2018 to 2019. What drives much of that growth is both an improvement in technology and an increase in government subsidies.
Additionally, people have a desire to improve the environment. They are willing to pay the upfront cost in solar installation for a long-term electricity bill savings. It can cost a homeowner anywhere from $14,000 to over $50,000 to have solar power installed in their home.
To start, get proper training—solar power installation training costs are usually around $1,000. Additionally, your state may require specific licensing, such as a solar power contractor’s license. To determine if you need this license, it’s best to check with your state’s official business licensing website.
It can cost less than $30,000 to open a solar power installation company. However, that is if you work out of your home and aren’t purchasing solar panel installation equipment in advance of a signed and paid contract. The profit margin for a solar power installation business can reach up to 60%—government tariffs may decrease this for your business.
As an added resource to our 2020 best businesses list, download our popular Starting A Business E-Book.
5. Medical Marijuana Services
The medical marijuana industry has two of the fastest-growing businesses from 2018 to 2019—both growing and retail. Marijuana-growing-based businesses grew 30%, and retail marijuana stores grew 27%. As more states legalize medical and recreational marijuana and allow farming within the state, the industry will continue to grow.
It’s a challenge to open a marijuana business because it’s highly regulated and taxed. For example, in many cities, a store must be 1,000 feet away from churches, schools, and residential areas. Additionally, you will need to acquire a state license before opening a marijuana business. States may also charge an excise or sales tax. For example, Colorado charges a 15% excise tax, which is a tax levied against the business.
The cost to start a marijuana dispensary (another name for a store) will be high. Expect to spend at least $150,000 to open a small dispensary. The amount of income you earn will vary, depending on location and demand. Due to increased competition, sales for the average store has decreased. You should expect to earn anywhere from $50,000 to over $300,000 a year as a store owner.
6. Local Meal Kit and Food Delivery
Meal kit delivery is one of the fastest-growing industries from 2019 to 2020, with a revenue increase of 22.8%. The restaurant industry has been hit hard by COVID-19. As a result, you can expect the meal kit industry to grow as people choose to eat in more.
Instead of trying to take on national meal kit giants such as Hello Fresh and Blue Apron, consider creating a local-based meal kit delivery. People like supporting local farms. A unique selling point is ensuring meat and vegetables are all grown locally.
One of the beneficial aspects of a meal kit business is that revenue is recurring. Let’s quickly look at the numbers. If you get 300 customers and charge them $120 per month (for 12 meals), that’s $36,000 in revenue per month. With only 300 customers, you’re already over $400,000 in revenue a year.
As an alternative to meal kits (or in addition to), you could deliver local food to residents. Food delivery demand has increased as more people avoid grocery stores and restaurants to avoid coronavirus infection.
7. Subscription Box Service
It can be challenging to start a subscription box service because you will need capital to start the business. However, you could run a crowdfunding campaign on a website such as Kickstarter to gauge interest in your idea and potentially raise funds to start the business.
A subscription box service typically operates on a recurring revenue business model. The income per customer per month will be less than a meal kit—around $25 per month. To get at $500,000 per year in revenue business, you’ll need close to 1,700 monthly customers.
8. Custom Face Masks
The demand for face masks has skyrocketed. In April 2020, Etsy sold hundreds of thousands of face masks through 10,000 different online stores. Incredible. As more cities, states, and businesses require patrons to wear a mask before entering the store, demand for face masks will continue to grow.
We can also expect that people will want unique masks to match their personalities. Browse Etsy’s face masks, and you’ll see several different fabrics, patterns, and fits.
Keep looking at that Etsy page because this is where the opportunity lies. Notice how poor the marketing is for masks. Lots of low quality photos without someone modeling the mask. A business with well-designed masks and exceptional marketing could quickly carve out a market on Etsy.
Unless we experience additional viruses, the demand for custom face masks could eventually end. When you notice demand waning, consider transitioning from selling face masks to another fabric-based business such as home decor (drapery, pillow, tablecloths), apparel (scarves and clothing), or simply raw fabrics.
9. Skilled Trade Businesses
Examples of skilled trades jobs you can turn into businesses are electrician, machinist, pipe layer, welder, and HVAC technician (heating and cooling tech). Several sources are predicting that 31 million skilled trade jobs will be vacant in 2020. A huge challenge of filling these jobs is finding skilled workers. There is a huge opportunity to start a business that not only serves customers well but also trains future skilled trade workers.
Number of Vacant Spots in Skilled Trade Jobs in 2020
One idea for training skilled trade workers is to provide apprenticeships within your business. Set up an apprenticeship program, and you will quickly have workers to fill the available skilled trade jobs. Business income will be stable and consistent due to a large number of job openings.
The cost to start a skilled-trade related business varies depending on the type of business you’d like to run. Expect to spend at least $250,000 to open the business, which includes location costs, equipment, inventory, licenses, and payroll.
Income potential can be high with a skilled-trade business because there is tremendous demand and opportunity to grow. It’s reasonable to expect to grow the business to over $1 million in revenue during the first five years.
10. Ecommerce Website Design
Ecommerce sales in the US are expected to grow steadily over the next several years. Combine that expected growth with how coronavirus has altered buying habits of millions of Americans and ecommerce sales will only accelerate.
The pandemic is forcing many businesses to adopt ecommerce to keep their business afloat. Even non-food retailers are making curbside pickup available for customers that may not feel comfortable entering the store. Overall, curbside pickup appears to be a success.
Most small biz owners don’t have the online tech skills to create an ecommerce-based website. They will need to hire someone to set this up for them. That’s where you come in. Fortunately, advancements in software and websites have made it easier and more affordable to set up online purchases for small businesses.
For your first few ecommerce website customers, you may want to charge a discounted rate. Once you have a portfolio of websites, charge a minimum of $5,000 to design an ecommerce-based website for a small business. For a small biz with hundreds of products, charge a minimum of $10,000.
11. Purchase a FedEx Route
FedEx had to cap the number of shipments allowed for dozens of companies because they got slammed with ecommerce orders. As consumers prefer shopping ecommerce over visiting a store, home shipping demand will stay elevated.
This increase in home deliveries is an opportunity for those who want to be one of the over 10,000 independent contractors that work for FedEx. Purchasing a FedEx route means you oversee a specific delivery route—train employees, maintain vehicles and equipment, and oversee day-to-day operations.
The average cost to purchase a route is around $100,000. Typically, you will get paid by each package you deliver—somewhere between $1 and $2. On average, you can expect to earn around $30,000 to $40,000 every year. Most FedEx route owners oversee a few different routes to increase income.
12. Pet Grooming
Pet grooming is expected to grow in demand as US households spend more money on their pets every year. Mobile pet grooming in particular may see an uptick in demand because elderly and immunocompromised individuals will prefer the groomer to visit instead of going to the groomer.
In addition to a possible demand increase, what makes mobile pet grooming appealing to many first-time business owners is the low startup cost. Some business owners can start for $10,000 in capital because they use the grooming vehicle as collateral.
Regarding the profitability of a mobile dog grooming business such as Wag’n Tails, if you groom 100 dogs per month at $75 per dog, you would earn over $90,000 per year plus tips. Not bad!
13. Online T-shirt Business
If you’re fashion-minded, starting an online T-shirt business could be lucrative. One benefit of this type of business is the low startup cost. For example, Teespring.com is a T-shirt design company that allows creators to open an online store and upload T-shirt designs for free.
When someone purchases your designed T-shirt through your Teespring store, they print, ship, and handle any customer service issues. All you need to do is create the shirt, and promote your store links. For many creators, this is their dream set up because they despise business operations.
How much can you make on a sale through Teespring? That depends on a few factors: the cost to print the T-shirt and how much you’d like to charge. The good news is that you set the price of the T-shirt. So, if you’d like to charge more for a unique design, you could charge a higher price. On average, expect to earn about $10 on a T-shirt sale.
14. Build an Online Brand
Building an online brand involves growing a following on an online platform such as a social media platform, an email list, a podcast, a Facebook group, or a YouTube channel. Often, an online brand’s followers are there for education, entertainment, or both. You can choose between creating an online personal brand or an online business brand.
An example of an online personal brand is Amy Porterfield. She has a popular podcast that teaches about marketing and sells courses about building an email list and online course. An example of a business brand is Fizzle. It has a free podcast and guides about being an online entrepreneur. Fizzle sells a membership with courses and coaches for those who want to become an online entrepreneur.
You can monetize an online brand by selling related products, advertising to followers, and getting a referral fee as an affiliate marketer (when your followers make a purchase).
Building a brand online can result in a high-profit margin business. For example, selling an online course can lead to a 95% profit margin— earning $100,000 in revenue, but it may only cost $5,000 in expenses.
Your first step to building your online brand is to choose your niche. Are you going to educate and teach people, or entertain them? Once you select your niche, decide on an online platform. YouTube is excellent for long-form entertainment and education; however, Instagram is geared for short-form entertainment.
15. Managed IT Services
If you are interested in tech, consider starting a managed IT (information technology) service business. Small and medium-sized businesses need help with issues such as data backup, cybersecurity, and network configuration. Any company that handles sensitive customer information needs a computer system protected from hackers.
Because this business is mostly knowledge and service-based, the startup costs are relatively low. TeamLogic IT is a franchise that focuses on managed IT services. The cost to start the franchise is around $150,000. If you’re not financially ready to start this franchise, consider working as an IT Technician at a TeamLogic near you, or a similar business, to gain valuable work experience.
A consultant is a person or firm that provides expert advice in a particular area. This is a great business to start because it’s flexible and can have a high-profit margin. When consulting, the costs are low, because you are the product. Clients are paying for your own knowledge and expertise. Additionally, you can do the job at home and save on overhead costs.
To get started as a consultant, you need a client base. Many consultants get clients through the professional network they’ve built over decades. If you’re someone who needs to grow your potential client base, you need to establish credibility.
A hack to establish credibility in an industry is to write a book. It doesn’t need to be a long book—about 100 pages would be the minimum length. If you don’t want to write the book, you could hire a ghostwriter to take your thoughts and ideas and turn them into a book. Once you have a book—and the book provides value—your credibility increases instantly. Additionally, it’s a great way to get speaking gigs in front of potential clients.
As a consultant, you can earn anywhere from $100 to over $300 an hour. To reach the higher rate of pay, you’ll have to prove your worth. Some of the most common consulting areas are business strategy, environmental, software, human resources, marketing, and financial.
When consulting on your first projects, consider how you can translate that project into a story-based case study. To charge a higher hourly rate, potential clients need to understand the value you can provide by reading through your past client successes.
17. Massage Therapy
Another top growing industry in the US is a massage business. From 2019 to 2020, massage therapy franchises grew 18%. Recently, it has become easier for massage therapists to find clients with the increase in popularity of websites like Massagebook and apps like Zeel and Soothe. These platforms connect those looking for massages to therapists and companies. Although massage therapy took a hit during COVID-19, due to reopenings, many therapists are heading back to work with the right safety protocols in place.
Becoming a massage therapist requires a long-term mindset. On average it will take about a year to complete massage therapy classes, and will cost around $8,000. Remember, after completing classes, you then need to build your business with a reliable client base.
One benefit of starting a massage therapy business is that you aren’t required to have a physical location. No overhead can save you a lot of money.
A mobile business is where employees go directly to a client’s home to give the massage. However, if you’re opening a physical location, expect to spend at least $75,000 (which includes six months of expenses) for a small location with one therapist and up to $500,000 for a larger location with several therapists. The Massage Envy franchise states initial investments from franchise owners range from $440,000 to over $1 million.
18. Graphic Designer
If you have a creative and artistic personality, selling graphic design services is a great business to start. Getting started with graphic design has never been easier due to the online platforms that connect graphic designers to potential clients.
For example, 99designs is an online platform that allows graphic designers to submit work as a bid for a job. The client chooses the design they like the most. You also should have a website showcasing your work and expertise. Clients will often discover you on an online platform and then contact you through your website for additional work.
To get started as a graphic designer, it’s crucial to have a portfolio showcasing your best work. We recommend you specialize in a particular design niche when first starting out. For example, if you specialize in the restaurant industry, you can appeal directly to restaurant owners by marketing creative designs for related items like menus, restaurant flyers, and signage.
Consider hiring your first junior graphic designer once you have a consistent and full schedule of design work. The cost to get started as a graphic designer is minimal. Your expertise and services are the product. You can start getting clients for under $1,000 in expenses. As a graphic designer, earn anywhere from $30 to over $200 an hour.
19. Accounting Firm
We’re going to see a massive transfer in small business ownership through 2021. According to a Facebook survey, one-third of small business owners said it’s unlikely they will open back up.
New owners will purchase many of these businesses. This new purchase presents an opportunity for accountants and bookkeepers to assist the new owners with understanding and operating the business financials.
An accounting business is also one of the most stable businesses to start. Every few years, tax laws change. Both people and companies need accounting assistance to comply with the new laws. Additionally, companies need audits in both a growing economy and a recession. The demand for accountants remains relatively consistent.
The cost to start a small accounting business can be less than $20,000. Save money on rent by using an office in a coworking location for you and your small team. A coworking office is a shared location with other businesses.
The amount of income potential for an accounting business depends on the amount of billable hours per project. You can charge between $150 to over $300 an hour, depending on the type of services you offer.
If you plan to do bookkeeping solely, you don’t need a degree or official certification. You can still make a decent amount of money as a bookkeeper, but not as much as a certified public accountant (CPA) with a firm.
You might also choose to offer tax preparation services only, using one of the big income tax firms, like H&R Block, as a partner. You may need a special certification, especially if you choose to partner with a larger company. Still, you can usually complete the training within a few months or less.
To get your new accounting business noticed by potential clients, consider creating content to educate your target market about accounting best practices. For example, if you’re specializing in accounting for manufacturers, create blogs, ebooks, or videos about how they can efficiently track income, expenses, or strategies to help businesses save money on taxes.
20. Open a Franchise
Franchises are one of the best businesses to start because they have a high success rate. 92% of franchises are still operating after five years. When you buy into a franchise, you’re receiving all of the tools needed to make the business a success—branding, business systems, contracts, and support. A franchise can be an easy business to operate because you don’t have to spend years learning how to manage the business effectively.
The main downside to most franchises is the amount of capital it takes to start one. Many franchises charge a franchise fee to open, which can cost tens of thousands of dollars. Additionally, they may also require you to have a certain amount of personal liquid capital or a net worth more than $500,000.
Franchise Opportunities is a website that connects those looking to purchase a franchise with those looking to sell. It includes information about popular franchises such as Jimmy Johns and Allstate, in addition to more niche and affordable franchises.
21. Child Day Care Center
Depending on your local area and business restrictions, a child day care center may not be the best business to start during COVID-19. However, if this is a business you’d like to start, use the time during the pandemic to plan your business.
Because of reduced capacity, we’re going to see many child care centers go out of business. You may find a good deal on purchasing a turnkey (ready to operate) child care center near you.
Consider that a child day care center is one of the most frequently financed businesses by the Small Business Administration (SBA). The challenge of opening a day care center is that it does require around a 20% down payment by the borrower, which is a standard lending practice. If you need to finance $125,000 to open your daycare center, you must put down $25,000 to obtain the loan. As an owner of a well-run day care, earn up to $60,000 during your first year.
A benefit of starting a child day care center is if you open one in an underserved area, you may receive government funding. For example, the Head Start Program is a government-funded program that provides early childhood education and services to low-income children and families. Head Start provides funding to qualifying day care centers.
A downside of opening a child day care is the licensing requirements. Your state may require a training class to ensure you’re prepared to care for children at the center. Your state may also enforce a certain number of workers per child watched. To learn about your area’s specific requirements, it’s best to visit your state’s official business licensing requirements website.
Ultimately, the best business to start for you depends on your skills, interests, and financial situation. Observe your local area and see what enterprises are in-demand due to COVID-19. Where is competition lacking in your area?
If you have funds to invest in a business, consider starting something with a storefront or vehicle such as a medical marijuana dispensary or mobile pet grooming. If money is tight, consider starting a low-cost business, such as home healthcare or personal training.