Any plan to buy businesses ready for success should include a review of the market sectors expected to thrive in the economic climate of the future. Most buyers know to avoid companies such as a photo film processor, a vendor with candy bar machines in school lunchrooms, or a printer specializing in street maps. But other trends deserve attention. Consider these ideas when evaluating the many kinds of businesses that are offered for sale. 1. Green companies--Ignore politically motivated cynics who claim our economy will remain fully dependent on petroleum, and on habits of the "throw-away" consumer for the foreseeable future. A recycling company, a firm that installs solar panels or one that converts auto engines to run on used cooking oil are businesses that ought to have a profitable present and future. 2. Serving seniors-- The population bubble of baby boomers reaching the senior years means billions being spent on products and services specific for this market. And there is a broad range of businesses in this category, from care centers and at-home services to educational programs, travel and tour enterprises and, if you have the proper training, health facilities. 3. Personal services -- Not only does the economy's personal services sector offer numerous and varied opportunities, it also has this advantage: the competition can't outsource to reduce costs and beat you on pricing. Companies offering massage therapy, beauty services, computer technical support, laundry, house cleaning, childcare and the many other functions on which people rely to manage their busy lives, command a significant dollar share of the economy. For many entrepreneurs planning to buy businesses, the search should involve a close look at this sector. 4. Catering to limited budgets--Whether it's a dollar store, recycled clothing boutique or services for the DYI customer, companies marketing to budget-conscious consumers have a good future. Even in a rapid economic recovery, it will take a long time for most of the currently unemployed to get absorbed into the work force. And middle-class people with limited financial resources --much of the population--won't be back to their overspending habits any time soon. In the meantime, expect growth for companies catering to the budget conscious, and a desirable category for many business buyers. 5. Work-at-home opportunities--Searching for a worthy investment among Internet-based enterprises and other businesses you can operate from your kitchen table is like crossing a minefield to get to an oasis. Yes, work-at-home opportunities are very appealing, but many offerings in this category are not worth anywhere near their asking prices. Sellers often promote companies that have yet to earn a dollar although based on what seem like good business plans. When looking to buy businesses that can be run from home, seek those with a documented history of solid earnings, a base of customers, and a product or service to sell that has proved to be popular. 6. Buy local enterprises--The desire to support merchants near home rather than add to the profits of big chain stores, and to avoid imported merchandise of questionable quality, and to discourage the energy-burning practice of shipping goods to your table from across the globe--these consumer motivations are contributing to a growing trend of buying from local merchants. Business buyers interested in retail companies for sale are smart to search for those with a strong following in their neighborhoods. As customers realize the benefit to their cities and towns of keeping their money in local circulation, many retail merchants rooted on Main Street, rather than Wall Street, will have the opportunity to take back some of the market share they had been losing to the big box operators. The successful plan to buy businesses should include, along with choosing competent advisors and conducting careful due diligence, the tactic of focusing on industries well positioned for 2010 and beyond.
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