Certain businesses thrive on good economies. Fine dining establishments, tourist trades, and gambling do well when the economy is good, but they tend to tank when it’s bad. A lot of people are not willing to spend the money when they think their job is on the line.
There are certain industries that do just fine during a recession though. Even if the economy is bad, you still need to pay taxes, people are still going to die, and people are still going to need food and water. Industries that are based around those facets of life will still do well when the economy is bad.
But there are some industries you would not think of as recession proof that you would not peg as being recession-proof. Here is a small list of them.
Antique Restoration is the practice of making junk items, and bringing them back to working order, sometimes better. Sure, they purchase items to restore and sell, or they do the restoration work for other sellers, but that is only half of the business model. The other half is restoring childhood memories.
Any business that deals in nostalgia tends to survive recessions quite nicely, because people are willing to pay a little extra to bring to life a childhood memory. Having your favorite childhood toy, or an object that your grandmother used, can take you back to a time when everything was a lot simpler than today. Be prepared to pay a lot of money for your item to be returned back to childhood glory. Depending on the damage done to the piece, and what exactly the client wants done, it can be quite an expensive process. But a lot of people will eat the cost to have something that reminds them of childhood.
The best known restorer is Rick’s Restorations, the focus of the show American Restoration, but there are restoration places all over the country. The owner, Rick Dale, is something of a general restoration expert and his backlog of projects can take upwards of a year to complete. But there are plenty of restorers all over the country, each with backlogs just as long, if not longer.
9. Tattoo Artists
Even in bad economic times, people will splurge a little on luxuries. The reason is that people want to give themselves a little extra something when times are tough, and a tattoo will last until you decide to get rid of it yourself. Also, the unemployed get more tattoos because they do not have to adhere to any company dress code.
It’s hard to figure out how recession proof-the tattoo industry is because there is no national organization keeping statistics, but first-hand reports from tattoo artists indicate that they are not losing money because of these economic times. The best guess is that the industry is recession-resistant.
A side effect of this is an increase in tattoo removal services, with increases of 50 percent in some places. This is because there are people that still get tattoos for stupid reasons, even during bad economic times. In addition to getting rid of various names, such as the ex and that one mistake from that night of heavy drinking, clients opt to remove visible tattoos for job seeking purposes. This is done not at the behest of the company, but by the owner of the tattoo themselves. The tattoos tend to make them feel isolated from their fellow employees because too many tend to attract unwanted attention.
An unfortunate side effect of using an item is that it will break down. During good economic times, we feel more indulgent with our money and are more likely to replace our items. When the economy turns south however, the trend shifts and everyone wants to repair items and keep them going as long as possible.
The biggest repair industry that sees increased business in a recession is the automotive repair industry. All areas of the automotive repair industry sees increased business. Common areas that see increases in business are auto parts providers, such as Autozone, Pep Boys, and O’Reilly. In 2011, Autozone impressed their investors by announcing almost 2 billion dollars in sales. Pep Boys showed a similar increase last year as well.
Automotive recycling is a $10-billion-per-year industry, and a sizeable percentage of that is from dismantlers. Every month of this current recession, auto dismantlers reported more and more new customers looking for a bargain when fixing up their car.
Outside of auto repair, home appliances get repaired a lot more often during bad economic times. Even something as disposable as computers tend to be repaired a lot more often during bad economic times. Refrigerator repair increased 800 percent in the first year of the recession, and computer repair saw a 400 percent increase.
When money gets tight, we tend to slip on paying our bills from time to time. For any of the utilities, if you do not pay, you will get turned off and you will have to pay a higher fee to get it turned back on. When it is an item that you are buying through a payment plan and you neglect to pay, the rightful owner will try to get it back after a set amount of time has passed: usually three months, sometimes longer. After they obtain the right to get their item back, they turn to a repossession agency to do so.
Repossession is one of the few businesses that thrive during a recession. Some agencies, especially in larger cities, can get 200 or more calls a month. When economic times are good, a repossession business would usually get 20 to 30 calls a month.
Repossession is something that has been in the spotlight nowadays because of shows like Lizard Lick Towing, Operation Repo, and Repossessed. There is some inherent drama in the whole situation. Having your vehicle towed can be an emotional event, and some people do not take it well. A lot of people just cry on the side of the road as they see their vehicle driven off, but some get downright confrontational. This business is not for people that are too soft.
6. Discount Chain Stores
When the economy tanks, a lot of people want to make sure their money last as long as possible. Every dollar should count outside of recessions too, but a lot of people are not as foresighted when times are good. In bad times, everyone starts heading over to the Wal-Mart to fulfill their daily needs; even people that are against it philosophically will shop there. When you feel that you are struggling, no matter how true it is, you tend to look for bargains.
During most quarters of the recession, Wal-Mart averaged a 2.5 percent sales increase. Other stores from the recession tended to do just as well.
If you looking for bargains and still hate Wal-Mart, you can always go to the Dollar General, the Big Lots or even many of the mom-and-pop .99 cent stores out there. Any place that provides similar items to Vons or Target, at a much lower price, tend to do better in recessions. Recently, Dollar General announced that it was opening 625 stores all over the country, increasing the overall workforce by 6000. At the same event, Dollar Tree announced a 5.1 billion dollar profit.
5. Freelance/Temp Work
Work needs to get done, even during a recession. Companies are feeling the crunch too, and have to let go of employees sometimes. They need someone to take over the burden of the let-go employees and the increasing paperwork. There’s only so much extra work the company can place on the remaining staff and still be productive. Sometimes they have to rely on temporary staffing to meet the demands of the recently let-go staff.
A temp worker is simply that, a temporary staff member hired on to take over the duties of the staff for a set period of time, sometimes a day, other times a lot longer. If you get along great with that particular supervisor, he or she might hire you at a full time, or at least request you on a semi-permanent basis.
Those that are fortunate enough to have jobs, but still want to make a little extra for other expenses, can get into the world of freelancing. A freelancer is something of a mercenary, which is what the term originally meant. He or she sells his services for one assignment, collects their pay, then moves on to the next, choosing to work with a company again if he or she feels like it. Freelance writing is the biggest freelance market out there, but it is not the only one. If your talents lie elsewhere, you can find freelance work doing just about anything you can think of.
Our country has become reliant on the energy grid for pretty much our day to day needs. We need automobiles to get from point A to point B. We need electricity to power our homes, our places of work, where we eat and where we shop. An increasing number of us also need the Internet for our daily business. We will need energy providers so we can live.
One thing to understand about energy is that its stable. It grows very slowly and demand does not diminish at all. If you have a job right at the start of the economic downturn, chances are pretty good that you will have that job at the end of it. The only exception to the general trend is in the area of green energy, such as solar, wind, and water powered turbines. In the last couple of years, there is an 300 percent increase in these sectors of the market.
3. Candy, Gum, and Snack Food
When the economy tanks, sales of quick snacks skyrocket. In 2008, Cadbury saw a sales increase of 30 percent from the previous year; Nestle grew 12 percent in the same year and Hershey’s saw an increase of 9 percent. During bad times, candy sales increase because it tends to soothe the nerves for a time. It is an easy and affordable indulgence that acts like a psychological barrier from the world. When you eat a piece of candy, gum or other snack food, especially a childhood favorite, it takes you back to a much simpler time, when you did not have to worry about the world and your place in it.
A lot of companies have realized how psychological these products can be, and have started to advertise for that nostalgia. Pepsi, Coke and other soda companies have altered their can designs to resemble how they look from when you were a kid. Retro soda brands like Tab, Mello Yellow and Fresca have also been brought back in limited qualities. Candy is now looking like it did back in the day as well. Basically, anything that reminds the consumer of childhood is doing well in these times.
On the rare times that people do go out for an indulgence during a recession, they are more likely to catch a movie. Even though it’s expensive to see a movie even during good times, its price tends to be much better than buying a copy from the store. It provides an escape from the struggles of reality for the length of the movie. Since the recession started, ticket sales of summer movies have increased exponentially, with last summer’s Transformers: Dark of the Moon making $1.3 billion worldwide.
A related business that sees an upsurge during a recession is the rental business. During the first year of the current recession, Netflix saw an almost 50 percent increase in rentals; its British equivalent, Lovefilm, showed a similar growth.
This is basic economics. Renting a movie for less than $2 a day, or paying $20 a month for a Netflix account, is cheaper in the long run than paying upwards of $25 for one new DVD.
1. Fast Food
During a recession, people cannot afford to pay upwards of $20 a person for a quality meal at a fancy restaurant. They might be able to do that once in a while, but for daily meal options, they need some place that deals in quantity over quality. While not the ideal for proper nutrition, any of the fast food providers can do this.
During the first few years of the recession, McDonald’s often announced that their sales increased 5 percent from the previous year. Other fast food franchises continue to show the same kind of growth.
As a sometimes-splurge, a lot of non-chain restaurants are offering cheaper dining options for their clientele. Many mom-and-pop restaurants started doing fixed priced options for their places, such as ordering three items in the restaurant for one low price. This is similar to the “2 for 20” deals that places like Applebees, Chilli’s and other chain restaurants, but arguably better because they are made in the restaurant. Which places are offering these deals in your community can be easily discovered via your local paper’s food and dining section.
Written By Joseph Ferguson