Here are 10 of the most successful small businesses for you to consider starting in 2023.
- Catering Business
- Real Estate Investing
- Online tutoring
- Retail – Building Supply
Although some of the most profitable businesses are online, others offer in-person services. Food trucks, for example, are expected to continue growing to $6.6 billion by 2028 due to their geographic versatility, potential for high returns, and flexible menus.
Steps to increase small business profitability include:
- Knowing key numbers like annual sales revenue
- Understanding gross profit margins
- Keeping track of net profit figures
Before starting a small business, consider the market size, competition, and average industry profitability. It takes most small businesses 18-24 months to generate a profit.
Starting a Business in 2023
As the small business sector continues to grow, it’s important to stay up-to-date on the latest and most profitable business opportunities. If you love to cook, you can start a catering business from home. Real estate investing can be a good option for those looking for a passive income business.
Profitable Business Opportunities
Online tutoring is a lucrative opportunity that can earn between $20-50 per hour, reducing costs with the absence of a physical location.
Cleaning services offer a profitable model due to their low barrier to entry and the value of word-of-mouth marketing. Furthermore, freelance copywriting businesses can be profitable if you have a way with words, as many businesses and organizations pay for a variety of written content.
Most Profitable Businesses of 2024
Ecommerce firms remain consistently profitable as they cover all businesses where products are bought and sold over the internet.
Profitable Business Models
Here are the most profitable types of small businesses:
- Food trucks
- Cleaning services
- Dog walking
- Website design
Small Businesses with High Profit Margins
Accounting and tax services top the list with an 18.4% net profit margin. Real estate services and law firms also report high profits.
Death care services are also on the list with a profit margin of 10.7%. This industry includes undertakers and funeral homes which demonstrate consistent demand and low overhead.
Profit margins for small businesses vary based on size and industry, but a healthy range is typically between 7% to 10%.
Understanding Profit Margins
Profit margin is the amount by which income exceeds revenue. Operating profit margin or return on sales measures the proportion of income to revenue and provides insight into profitability. Higher profit margin translates to a stronger, healthier business.
While the most profitable online businesses require minimum investments, they also aim for maximum returns.