The Rise of Recession-proof Businesses
During the last 25 years, the U.S., Canada, and the world experienced two major economic upheavals. First, the Great Recession from 2007 to 2009 took about ten years to recover from completely. Then there was the financial crisis brought about by the COVID-19 pandemic and the subsequent lockdown. As a result, the term “recession-proof” has become quite common — whether among those in business and finance or even among regular people.
According to the Federal Reserve, the Great Recession began in December 2007 when the economy peaked. The decline in overall economic activity, while modest initially, came to its lowest point in the fall of 2008.
During the pandemic, job losses peaked at 13%, but by July 2022, the unemployment rate had returned to 3.5%. Transworld’s Main Street Market highlighted that many people had opted to leave the corporate world and pursue their own entrepreneurial dreams due to the Great Recession. Thanks to COVID-19, even more individuals are seeking to own their own businesses and focusing on industries with a greater chance of surviving the next economic downturn. So, what are the top industries for those seeking to buy or start a company?
Industries on the move in Quebec and in Canada
New and existing entrepreneurs want to invest in a company with solid potential now and in the future. While there is no crystal ball that can predict what will happen in tomorrow’s economy, Transworld’s Main Street Market Report offers insight into which business categories have been trending upward in recent months. By deal volume, the best-performing industries were:
- Restaurants
- Construction
- Beauty/Personal Care
- Automotive
- Medical-related
Industries on the decline
Meanwhile, industries that appear to be declining include:
- liquor-related businesses
- Real estate
- Ice cream/yogurt shops
For liquor-related businesses and ice cream/yogurt shops, people have simply reduced their consumption of these items. Meanwhile, the decline for the other industries may have thrived during the pandemic, but as life has returned to normal, the demand for them has diminished. Additionally, some industries trending down may be related to increased mortgage rates now at a decade high in Quebec. Upon a spike in mortgage rates, landlords increase the rents charged to businesses.
Why sell your business now in Montreal, Quebec City, or elsewhere in Quebec?
So why should someone consider selling a business now? More people are looking to start their own businesses, making now a great time to sell. If you own one of the five industries listed above in the industries on the move section, now is the time to sell, as they have proven to be more recession-proof than others, making them more appealing to potential buyers.
What's next for you?
More people than ever appear to be interested in owning a business and being their own boss. When they select a business from an industry that has proven itself able to weather economic ups and downs, it helps to mitigate some of the risks that come with entrepreneurship. If you think now might be the right time to buy a business or sell a business, Transworld Business Advisors Quebec can help. Reach out to learn more from our qualified business brokers to make the next step in your future.
