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Whether you are looking for a market for your new business or a market to
expand your existing business, here are some growing markets that you should
consider:
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1. Small Business
In the US alone, there are about
25 million small businesses today. Small businesses represent a large market
that may be the only major source of growth over the next 10 to 15 years.
They are a very good market for their fellow small businesses.
The problem with the small business market, however, is
that they are hard to reach. Small businesses cut across industries, making
it difficult to craft a single marketing message to reach them. More
importantly, they often lack resources and have very limited time. Their
buying priorities are different, and focus more on value. Many of these
small businesses are also home-based -- the sole proprietorships that, in
most cases, have no employees and are run by an individual out of his or her
home. In fact, according to the Bureau of Census' Survey of Business Owners,
almost half or 49 percent of the nation's businesses are operated from home.
2. State and Local Governments
According to the
Bureau of Economic Analysis, expenditures of state and
local governments have grown from $411.9 billion in 1984 to $1,490.3 billion
in 2004. It is expected to grow to $2,396.9 billion in 2014.
The local government is a big market that small businesses
can tap. Small businesses can win thousands (if not millions) of dollars a
year in local government contracts. The challenge lies, however, in knowing
the ins and outs of selling to the government and understanding the
government procurement process.
3. Growing Hispanic Market
One of the fastest growing consumer segments in the United States today
is the Hispanic market. The number of Hispanic households is estimated to
increase at a faster rate than any other group in the United States,
continuing a demographic explosion that began several decades ago. Assuming
that growth rates persist at their current phase, it is estimated that
Hispanics will account for nearly one out of every five American residents
by 2012. As such, opportunities abound for small businesses that consider
implementing new approaches and strategies to target the Latin Americans.
However, it is important to note that this young, burgeoning market is
extremely diverse. There are extensive demographic and economic differences
among the Hispanic household population. Native-born Hispanics who have
lived exclusively in the United States have different consumption and buying
patterns than the immigrant Hispanics. US-born Hispanics speak
English fluently and more likely to have grown accustomed to American tastes
and living. The large influx of new immigrants, on the other hand, prefer
information in Spanish and more likely to shop in stores where personnel can
speak Spanish to them.
4. Gay Community
The gay and lesbian market may be
offbeat for some, but it is one market that even the big boys are checking
out. In fact, there are now about 175 Fortune 500 brands including American
Airlines' AAVacations.com, Volvo and American Express that advertise
specifically to gay and lesbian audiences.
Big companies are no longer ignoring the power of the gay
consumer because of this group's tremendous buying power, which was
estimated to be about $641 billion in 2006. While on average they do not
earn more than other Americans, this market has also more disposable income
(hence bigger buying power) because fewer are raising children. Setting
aside any moral objections or issues about this group, GLBT is a market that
small businesses can consider.
5. Burgeoning Consumer Debt
Americans today owe more money than they make.
Consumer debt as of October 2006 is now at a record $2.378 trillion,
according to data from the
Federal Reserve Board . A May 2006 study
by the Center for American Progress shows that household debt
levels have
reached 108.4 percent in 2005, exceeding household income by more
than eight percent. Data from
USCourts.gov show that there
have been 1,112,542 bankruptcies as of fiscal year ending September 2006.
American families borrow more money to keep pace with the rising cost of
living. The problem is compounded by the weakening of the labor market, flat
wages and falling incomes while prices for critical ticket items such as
health care, housing, college education have increased substantially.
The problem of growing debt presents many opportunities for small
businesses. One such business that thrives in this situation is a home-based
collection agency. There is also a growing need for credit counseling
businesses as well as debt consolidation companies.
CONTINUE TO PART 2
Updated January 2007
Originally Published
November 2005
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