General Motors, Disney and Microsoft all famously started in times of economic crisis, and no self-respecting entrepreneur would allow the current downturn to put them off starting their business. It makes sense to avoid start-up ideas that are cash-hungry to get off the ground, or businesses that rely on a buoyant economy, like property or luxury holidays. So what kind of businesses do thrive in the recession? Take inspiration from these successful companies who have turned economy-busting ideas into money makers.
LUXURY FOR LESS
A new generation of fashion-on-loan businesses are booming. Rent Your Rocks started in 2006 loaning diamonds and pearls at a fraction of the purchase price. With finance houses so risk-averse, founder Sophie Croydon says, “The biggest headache was insurance, but we persevered and now we count The X Factor and A-list celebrities among our clients.”
The Ila Dusk personal alarm’s success lies in its ear-piercing scream and its timing. Neil Munn, CEO of Zag, a division of ad agency BBH, which developed the brand, explains its recession-related success, “More women take buses rather than taxis at night and want to feel safer.”
Zeitgeisty businesses get media coverage which equals free advertising. Anna Bance, founder of dress rental service Girl Meets Dress, says, “It was a great time to launch. Magazines and newspapers covered us with ‘recession dressing’ headlines.” And my company was a neat example for “Support British business” stories.
Businesses are avoiding long-term overheads such as extra staff. Online start-ups peopleperhour.com and timeetc.co.uk provide high-quality staff on a per-hour basis, meaning none of the commitment of full-time employees. Time Etc reports 25% growth in 2011, forecasting 50% for the coming year.
TREASURE NOT TRASH
The days of disposable consumerism are long gone. “People care more than ever where their hard-earned cash is going,” says Jeanette Ward, whose company Rosie Robins makes customised prints featuring family sayings. “It’s a personal and unique gift – we can barely keep up with orders.” Launched on notonthehighstreet.com at the end of last year, Rosie Robins’ personalised products now sell more than double other items in its range. It’s always a great time to launch your business – you just need to pick the right one.