The Best Service-Based Business Ideas: A Top 10 List
Want to start your own service-based business? This list includes only ideas that have the best chance of success. All these small business opportunities are likely to be profitable in 2020 and beyond, will weather economic ups and downs, don’t require extensive education or experience and don’t need a huge investment to start.
Plus, many of these business ideas are home-based. While they may not make you a billionaire, these business opportunities will provide you with the freedom to manage your time and enough profit to make a good income. All you need is hard work and a can-do attitude.
In this article, we’ll cover:
- Monthly Subscriptions
- Cycling Businesses
- Coffee Business
- Senior Care
- Pet Care
- Software Development
- Vacation Rentals
- Home Renovation
- Amazon Fulfillment
1. Monthly Subscriptions
Monthly subscription services are popping up in all categories from cosmetics to pet products to wine. Every month you hand select products to send to your customers in a unique box. This model allows for monthly guaranteed income.
An interesting (and popular) twist on this idea are meal delivery services, specifically meal kits. Meal kits are projected to hit $10 billion in sales by 2020, according to The Balance. The trend has only started.
Meal kits deliver recipes and ingredients to your door at pre-arranged dates and times. Ingredients are already portioned and/or chopped. They’re an alternative to pre-cooked meals for busy professionals who still want to make home-cooked meals but are short on time.
You could either prepare the meal kits or work to source ingredients from wholesalers or local farms for meal kit businesses.
Self-storage is a big opportunity as people move around more, rent small spaces in expensive cities, buy condos, downsize or accumulate more items. Home-based businesses with lots of machinery or tools, such as skilled trades, also need self-storage.
Self-storage requires more startup capital than our other business ideas—you’ll need a space that can be climate controlled, security and lighting. That said, if there’s high demand for self-storage in your area, financing such as bank loans should be easy to get. This is an industry with a lot of potential.
3. Cycling Businesses
Biking is catching on in the U.S. Commuting via bike has increased 47 percent in the whole country and 80 percent in major cities since 2000. Cycling is an $81 billion dollar a year industry in the U.S.
There are a few options for service-based businesses here. E-bikes (bikes that can run on electric power) are one of the best as yearly sales are expected to hit 40 million bikes by 2023. You can focus on supplying or repairing these bikes or developing kits to convert regular bikes to e-bikes.
Or you can focus on repair, sales or rental of regular bikes.
4. Coffee Business
Americans love their coffee. In 2018, 64 percent of Americans 18 years and older said they drank coffee the previous day. This is up two percent from the previous year, according to Reuters.
At-home preparation has the highest demand. Only 36 percent of those surveyed said they drank their coffee the previous day at a coffee shop. And gourmet coffee dominates the market, with almost half of millennials saying they consumed a cup of gourmet coffee the day before.
What are your options?
- Independent coffee shop offering high-quality, crafted gourmet coffee (espresso based, not brewed) in a well-trafficked area with a unique, comfortable atmosphere
- Ordering coffee through smartphone apps or delivery (niche option, only 10 percent of coffee drinkers use this)
- Importing, distributing or selling gourmet coffee
- Using gourmet coffee to make other products like chocolate, bath items etc.
- Coffee subscription box
5. Senior Care
Employment of personal care and home health workers is expected to grow by 41 percent until 2026, according to the Bureau of Labor Statistics. This is largely thanks to an aging population that prefers to stay at home and avoid hospitals or nursing homes.
Personal care and home health workers help with everyday chores and/or medical care. Or for some more active seniors, there are opportunities to house and/or pet sit and help keep up the house and property.
How about creating a company where you hire your own personal care and home health aides? Or buy into one of the many senior care franchises available. Entrepreneur lists the best ones.
6. Pet Care
Americans spent $69.51 billion on their pets in 2017. That’s up four percent from the previous year, according to the American Pet Products Association (APPA). There are plenty of opportunities within this category.
Pet food is where most Americans spend their pet dollars, with growth focused around premium food and treats. The highest growth area is in pet services such as grooming, walking, boarding, pet sitting and training.
Supplies such as toys, clothing, leashes, collars, beds, bowls and travel items are also a big area of spending. Pet technology doesn’t yet have a huge market share, but it is growing too.
7. Software Development
Opportunities for employment for software developers is expected to increase 24 percent through 2026, according to the Bureau of Labor Statistics. This is faster than the overall average for all occupations.
Applications developers’ employment will rise 31 percent and system developers’ employment will increase by 11 percent thanks to greater demand for computer software in the U.S., especially for new smartphone and tablet applications. The health and medical insurance industry also needs new software to enroll applicants and administer policies.
Finally, software is increasingly being integrated into consumer products like pet and fitness products. These all represent huge business opportunities.
8. Vacation Rentals
This service-based business opportunity doesn’t involve investing in real estate. Instead, you manage other people’s vacation properties. Owners may not have time or interest in advertising on social media, managing online listings, cleaning and dealing with guests.
The vacation rental industry is booming. Revenue in 2018 is projected to hit $13,053 million in 2018 in the U.S. and grow annually by 7.9 percent through 2022, according to Statistica.
The most popular trends focus on accomodation for pets and dietary restrictions, according to HomeAway. A yard or a custom-stocked fridge are good ideas.
You can expect to earn about 20 to 40 percent of gross rental earnings, according to Medium. The more properties you manage the better and you’ll need to be in a busy tourist area.
9. Home Renovation
Homeowners between the ages of 35 and 44 spent on average $3,060 per year on home improvements between 2011 and 2015, according to Statistica. Remodeling has also grown 6.4 percent over the past five years until 2018.
Remodelling contractors include tilers, drywallers, plumbers, electricians, roofers, carpenters and painters. They typically are home-based businesses that work off-site. Tool and machinery costs are less than in the construction industry.
Remodelling contractors either do the work themselves, hire people or act as specialists in niche areas like solar energy. They need the appropriate licenses or certificates, knowledge of local safety rules and building codes, a solid roster of sub-contractors and plenty of hands-on experience and skills.
10. Amazon Fulfillment
Amazon runs a Fulfillment by Amazon (FBA) program that lets independent suppliers sell their product through Amazon’s online retail platform. Amazon absorbs much of the risk by handling customer service, packing, shipping, return and storage, though it’s not for free—they charge a fee for these services.
FBA sellers need to get their product to an Amazon fulfillment center and create listings on Amazon. Pay is sent to FBA sellers on a weekly basis. This is a low-risk way to try online retail, especially if you have a good eye for what people want to buy. Plus, you’ll be working from home.
People also ask:
What Are the Most Needed Services?
The most common business services include:
- Legal services
- Tax services
- Web design
- Writing and translation
- Design and multimedia
The most needed services overall include:
- Home healthcare services
- Mobile solutions consulting
- Professional organizing
- Wheelchair repair
- Pet-related services like grooming and walking
- Transportation services
- Event services (photography, limousine services, event planning)
- Kids services (nanny placement, kids fitness, childcare)
- Home services (inspection, painting, moving, house sitting)
What Are the Most Profitable Service Businesses?
Some of the most profitable service businesses, according to Entrepreneur, include:
- Accounting services (payroll, bookkeeping, taxes)
- Real estate agents and brokers
- Car rental
- Legal services
- Dental practices
- Power companies (includes wind and solar)
- Health services (mental health, podiatrists, optometrists, chiropractor)
- Commercial machinery rental or leasing
- Business consulting (for example, human resources, environmental, marketing)
- Design (graphic, interior, industrial)
- Office administration