The 10 Fastest-Growing Industries for Small Business

Past performance is no guarantee of future results, as the old business truism says. But you also may have heard that you can’t know where you’re going without knowing where you have been.

To get a sense of which industries small businesses are growing in, the analysts at Raleigh, N.C.-headquartered private-company financial-information company Sageworks ran some numbers for Entrepreneur.com. Here’s a look at the industries where U.S. companies with $10 million or less in annual sales have shown the highest and lowest percentage change from Jan. 1 to Dec 31, 2012. As a benchmark, the average growth rate across all U.S. small businesses in the time period was 8 percent, says Libby Bierman, an analyst at Sageworks.

Fastest-Growth Industries for U.S. Small Businesses in 2012

1. Residential building construction: 14.77 percent
2. Building custom software and servers for businesses: 14.29 percent
3. Machinery, equipment, and supplies merchant wholesalers: 13.75 percent
4. Management, scientific, and technical consulting services: 12.31 percent
5. Architectural, engineering, and related services: 11.40 percent
6. Foundation, structure, and building exterior contractors: 11.37 percent
7. Building finishing contractors who make additions, alterations, maintenance and repairs: 11.32 percent
8. General freight trucking: 10.41 percent
9. Services to buildings and dwellings, including pest exterminators, janitorial services, and landscaping: 10.11 percent
10. Other specialty trade contractors, including site preparation activities and other specialized trades: 10.04 percent

Related: Hunting for Business Ideas? Consider Looking at These 8 Hot Industries

Slowest-Growth Industries for U.S. Small Businesses in 2012

1. Skilled nursing care facilities: -3.29 percent
2. Printing and related support activities: 1.86 percent
3. Automotive repair and maintenance: 2.81 percent
4. Offices of physicians: 3.00 percent
5. Highway, street, and bridge construction: 4.24 percent
6. Insurance agencies, brokerages, and other insurance-related activities: 4.32 percent
7. Lessors of real estate: 5.07 percent
8. Other miscellaneous manufacturing including jewelry and silverware, sporting and athletic goods, dolls, toys, and games, office supplies other than paper, and signs: 5.55 percent
9. Offices of health practitioners other than physicians and dentists, including chiropractors, optometrists, mental health practitioners, speech and occupational therapists: 5.98 percent
10. Other amusement and recreation services including bowling centers, golf courses, and recreational centers: 6.03 percent

Related: Franchise Forecast Continues Strong for 2013

The good news for entrepreneurs is that much of the fastest growth is in service businesses, which can be started without a lot of money to buy equipment and inventory, says Bierman. Software development, management consulting and architecture firms have been frontrunners have been for a few years now, says Bierman.

Not all of the businesses on the fastest-growing list are service based. In particular, the residential housing market has just started to recover, and that is supporting businesses related to the construction industry, including foundation and exterior construction and specialty contractors. A lot of construction projects were abandoned during the recession and so part of the bounce in construction is businesses and individuals picking back up old half-finished projects.

Business services and construction are looking strong in the coming years. “They provide services that are, maybe not critical, but very much needed by other businesses and people who are trying to even grow their homes,” Bierman says. “I don’t see these industries going anywhere. Maybe their growth rate won’t be as high as it has been, but I don’t think it will be a decline anytime soon.”

Related: Most New Business Ideas Hatching for 6 or More Months

A list of the fastest-growing industries for all businesses would include manufacturing, says Bierman, but most successful manufacturers have more than $10 million in annual revenue. “Manufacturing as a whole has been something that has pretty positive news lately,” she says. “If those manufacturers are having pull, the middlemen, or the wholesalers that are transacting those sales, will continue to see growth, too.”

During the depths of the recession, many industries were contracting. Now, almost all industries are growing, albeit some at more sluggish rates. The slower-growth companies are not seeing impressive growth rates because they are entrenched in technology that is becoming obsolete, such as printing. But some of those industries are seeing slower growth simply because they have relatively inelastic demand. For example, an economic recession does not change the fact that sick people need to go to the doctor. The growth rate for physician’s offices does not typically change drastically.

Overall, the home health-care industry has seen positive growth rates in revenue over the past year as consumers look for an alternative to moving into a nursing care facility, says Bierman. Skilled nursing care facilities come up on this list as a shrinking, but that’s partly because of the restrictions placed on the data. For this research, Sageworks included only those businesses with less than $10 million in annual revenue. The decline in skilled nursing care facilities may be an indication that smaller facilities are losing ground to their larger competitors or home health care alternatives, she says.

source- entrepreneur.com

What Would-Be Entrepreneurs Fear Most About Starting Up

While a majority of Americans prefer to be self-employed, relatively few actually take the plunge. What's stopping them?

According to a 2012 survey conducted for the European Commission by TNS Custom Research, 51 percent of Americans would rather be self-employed and 44 percent think it would be possible for them to go into business for themselves within the next five years -- a figure that has increased 8 percentage points since 2009.

But despite the relatively large number of Americans who want to be in business for themselves and believe it feasible in the near future, relatively few would-be entrepreneurs actually take the initiative. Bureau of Labor Statistics data indicate that only about 6 percent of the adult population is self-employed, making the fraction of Americans who would prefer self-employment to wage employment about eight times as large as the share of Americans actually working for themselves.

Related: Why Americans Love Small Business

Why are so few would-be entrepreneurs starting businesses?

While a number of those surveyed have no intention of becoming entrepreneurs any more than they might act out their preference to play professional basketball or be a runway model rather than continue their day job, a surprising number have legitimately considered founding their own company and not followed through. One third of the people who told TNS they wanted to start a business said they gave up on the idea after having thought about it or taken steps to get the company going.

A number of those who wanted to start-up but didn't, faced real obstacles that kept them from going into business for themselves -- 4 percent could not come up with a business idea, 15 percent didn't have enough capital, 8 percent said they lacked the necessary skills and 2 percent said administrative barriers held them back.

Related: 10 Questions to Ask Before Quitting Your Job to Start a Business

Most people, however, didn't go into business for themselves because they were afraid of what would happen if they didn't succeed. When asked to identify what would-be entrepreneurs most feared about starting a business, the top responses were a fear of going bankrupt (38 percent) and a fear of irregular income (37 percent), which amount to a significantly larger sum than those who feared personal failure and losing job security.

But while the largest number of would-be entrepreneurs often stop themselves from starting a business because of the financial risks that self-employment entails, making money isn't the reason most Americans prefer to be entrepreneurs in the first place. Only 9 percent of respondents said they preferred self-employment because it offered a greater potential for making money than working for others. Instead, a majority -- 54 percent -- said they preferred to be entrepreneurs because of the independence self-employment affords, and a third said they would prefer it for the freedom to decide when and where to work.

In the end, money still plays an important role in influencing whether or not people go into business for themselves. While the opportunity to make money doesn't draw many Americans to entrepreneurship, the fear of going broke keeps them from taking the plunge.

source: entrepreneur.com

Fresh Idea: The Unlikely Inspiration Behind Food-Saver FreshPaper

By the time she was 17 years old, Kavita Shukla held multiple patents. Today, she is the 27-year-old CEO of Fenugreen and inventor of its core product FreshPaper, a technology that aims to keep fruits and vegetables fresh for longer. Inspiration struck in an unlikely place: a tooth-brushing accident while visiting her grandmother in India, an experience that has shaped her core business philosophy.

No idea is too simple, Shukla said today at the Women in the World Summit, where she was honored as a "mother of invention." The annual conference in New York is hosted by Newsweek and the Daily Beast and gathers some 2,500 attendees, including A-listers like Hillary Clinton, Oprah Winfrey and Angelina Jolie. Shukla shared her startup success story and lessons for other aspiring inventors.

At 13, Shukla accidentally drank the water while brushing her teeth at her grandmother's home in India -- a recipe for disaster in a country with notoriously unsafe tap water. As a remedy, her grandmother mixed up a batch of herbs and spices. She didn't get sick. When she returned home to the U.S., Shukla started experimenting with those same spices as part of a middle-school science project and discovered the combination was a potent inhibitor for bacterial growth.

A few years later, when she was a senior in high school, FreshPaper was born. It is a simple sheet of paper lauded as a "dryer sheet" for produce. Put a piece of FreshPaper where you store your fruit and vegetables, and they will stay fresh up to four times longer, the company promises.

Last year, Shukla launched FreshPaper in a local farmers market in Boston. It rapidly gained attention through word of mouth and is now sold in 35 countries. While she initially imagined that the paper would be most useful in the developing world, as 1.6 billion people globally live without proper refrigeration, the product is increasingly popular in the U.S. and recently became available at Whole Foods.

"I didn't realize [food spoilage] was a big issue in the U.S.," said Shukla. "I was really amazed by the response. People said things like, 'FreshPaper makes it possible for me to eat healthier and for me to afford fresh healthy fruits and vegetables.' Now, we actually donate FreshPaper to local food banks."

The next major step is to engage with farmers, both in the U.S. and in the developing world. If she could get FreshPaper in their hands, Shukla believes they could stop a great deal of food spoilage at the source and create more access to healthy food for people around the world. Fenugreen has already worked with farmers in Malawi and Haiti and hopes to expand.

Shukla offered these three tips for aspiring entrepreneurs.

Simplicity is valuable. 
"FreshPaper is powerful because it's so simple," Shukla said. "Simple ideas are the ones that have the power to change things because they can be used by everyone, everywhere around the world."

A good idea doesn't have to be trendy. 
"Believe in your idea," said Shukla. The next big thing doesn't need to be a fancy mobile technology or app. You never know how your idea will connect with others until you test it out.

Inspiration is everywhere.
"I often think [of] what would have happened if I hadn't drank my grandma's mixture, or dismissed it," Shukla said. Don't be afraid to play and experiment. Her grandmother's potion may as well have been magic, she said. 

source- entrepreneur.com

3 Apps to Help You Write a Marketing Plan

You might have a great product or an excellent service but your business won't grow unless people know you're out there. That requires marketing -- online, mobile, on Google, Facebook, direct mail or even printed flyers on doorstep. But where do you begin?

It all starts with a marketing plan. It's a written strategy to help achieve your goals and spread the word about your startup.

Here are three apps that can help you figure out your needs, understand your competition and develop a cost-effective marketing strategy:

1. Marketing Plan Premier 
This comprehensive iPad app is both a fill-in-the-blank tool and a mini-marketing text book. Marketing Plan Premier relies heavily on the idea that all good businesses provide a solution to a consumer problem. The initial steps involve defining that problem and how your product solves it.

From there, the app helps you analyze your competitors, determine your target market and come up with a price. Finally, the app briefly runs you through options for advertising.

Related: A Data-Driven Reality Check for Your Marketing Budget

Once you fill in all the blanks, Marketing Plan Premier inserts your answers into a pre-written multi-page, executive summary. You can export the finished Word document by email or through Dropbox.

Price: $9.99

2. Marketing Plan App 
If you don't need a lot of guidance, Marketing Plan App can get you similar results in less time. The app is available for iOS and Android, and it's formatted to work with the smaller, mobile phone screen.

This app can help you craft everything from your Vision Statement and market analysis, to helping you determine your marketing budget. After you fill in the blanks, save the document as a PDF or Word doc, then email to export or print straight from your device.

Price: $9.99 for iOS, $7.99 for Android.

Related: Writing a Business Plan? Don't Forget About Marketing

3. MarketMyBiz
This marketing plan app comes from a very unusual source: the government of Australia. MarketMyBiz is a beautifully designed app for the iPad or Android tablets. It isn't as wide-ranging as Marketing Plan App, but the navigation structure is intuitive and you won't get bogged down in boxes as you move from page to page.

This app also includes a section that helps you discover your weaknesses and helps you create a plan to address each one.

When you're finished, MarketMyBiz compiles your answers into one, simple report that you can print from the tablet or email as a PDF.

Price: Free

source: entrepreneur.com

Why giant retailers wouldn't affect local kiranas

Organised retail vs Local kiranas

      Many believe as the giant corps come into India after the govt has allowed FDI in retail, the local stores will be affected, some believe this would bring money and growth and employment, and some believe it would kill millions of shop owners. even politicians like Mamata Banerjee and Nitish kumar have opposed the idea and claimed they wouldn't allow this in their states. However, when I was in USA, I visited WAL-MART and Target stores, moreover I did some research in order to get a clear picture of how much would this affect INDIAN market, surprisingly, I don't think it's really gonna affect anyone apart from the organised retailers currently working in Indian cities. 

        Let's take a look at some of the pointers on why FDI in retal wouldn't affect India as hyped.

• Demographic of  India: Unlike US and UK, in India, language, food, clothes, traditions change after every 50 kms, if Walmart opens store every where, managing the inventory will be a big big issue as they won't be able to turnover the stock as they do in US, this may decrease profitability. In US they have stores away from the city and consumers buy in bulk and store for rest of the week or month, but in India, not many have the combination of time, motivation and vehicle. 
• Indian consumers: Local shop owners have given us some outstanding service over the years. If I need bread and eggs and milk at 7am, the shop owner will send a Chotu who will come running and deliver the goods something Walmart wouldn't be able to do ever and something we can't do without.
• Other countries: in countries like Brazil and China, walmarts have done successful business over the years because they haven't really had the concept of local kiranas, they either run community centres or grow themselves. Moreover they have enough space to allow 1 lack sq feet of walmart something that India doesn't have. China is larger than India in terms of space but has equal population thus density is low allowing land space. Brazil too is as big as India in terms of land but population in one sixth to that of India. Here they will get such land only in  outskirts. Now if I am living in salt lake and need some stuffs for home, I wouldn't travel all the way to Walmart to buy it, the cost may be cheaper there but my fuel expense will cover it all.
• Bleeding organised retails in India: India have had organised retail for over a decade now but when we look at the figures, it's not really tempting to invest here. Birlas run "More" stores all over India and has posted net loss of 423 crores last year. Reliance fresh made net loss of 247 crores. Bharti enterprise posted net loss of 260 crores. Subhiksha who at one time had over 12000 stores in India has shut down operations. Once these giant corporations come in, these Indian retailers shall sell equity and make some money using their expertise. 
• Supply chain: as mentioned earlier, India has diversified population, a product may sell in some part but may not sell in the neighbouring state. Moreover some states may not even allow them to setup stores so again this would affect the supply chain of the stores and managing inventory will be a really difficult task.

      So what's the end picture? Well, according to me, the small kiranas who know their customers by name now will eventually modernise and create databases, and there maybe a time when these giant corps may end up buying the small stores to increase their presence all over the country. It's happening for real in UK where Tesco has bought small stores and is running in different formats of retail like : supermarket , convenience stores and street corner stores. Similarly we may see the same scenario here in near future. These giant corps will have to make their own space in terms of consumers and land. This will certainly take time. So I don't really think allowing them will really have a bad effect in Indian retail market. As they wouldn't go about setting up stores in every locality.

Cheers,

Akash Poddar 

Hiring for startup

         Here’s something funny about first-time entrepreneurs. Even though they dream about making all the big decisions as boss of their own enterprise, when the time comes to recruit first teammates, they compromise. It’s true. Instead of seeking out a fabulous fit for their organization, they settle for the first person who “is available” and expresses enthusiasm for the startup mission.

The reason why startup entrepreneurs have a difficult time finding good people is they don’t try that hard.

Here are five considerations to help you hire the employee of your dreams.

1. Hire desired skills. Startup entrepreneurs are prone to hire an unqualified employee because the job candidate claims to be a “fast learner.” This kind of enthusiasm may work for larger companies with extensive training resources, but not for budget-starved startups.

Employees who are asked to do something they’ve never done before are likely to make beginner’s mistakes that will cost your company precious capital and time. The best way to avoid avoidable problems is to hire employees who have already “been there and done that.”

If, for example, your company needs proposal writing assistance for a Small Business Innovation Research (SBIR) government grant, don’t just hire any kind of writer to do this important work. Search for a grant writer who has prepared several SBIR proposals in recent years. Then, favor applicants whose proposals turned into grant awards. I’d always rather pay more to people who know what they are doing, than less to people who don’t.

2. Hire relevant experience. Desired work experience should be defined not in terms of years, but rather in terms of specific work achievements. Just because a biochemist has, for example, 10 years of work experience doesn’t mean that the previous work accomplishments line up well with your company’s operating needs.

Another way to define work experience is in terms of work environment. A marketing manager who managed promotion campaigns for a well-established, big-budget corporation may flounder when asked to conceive and implement promotional campaigns for a cash-poor startup. As you review candidates, pay attention to work histories in which applicants were required to perform with little managerial supervision and team assistance. I also like to hire compulsive organizers who are happy to create systems for an emerging enterprise.

3. Hire competitive drive. Let’s face it — all startups have to compete aggressively for customers. So doesn’t it make sense to hire employees who thrive in a competitive work environment? Great startup employees embrace competitive challenges, hate losing clients to competitors and are highly motivated to exceed work goals. During interviews with prospective employees, ask about sports interests and other personal and professional activities that involve achievement under pressure. Prospective employees who dislike fast-paced competition probably won’t be happy working for your new company.

4. Hire persistence. With hiring criteria that emphasize competitive drive, should entrepreneurs favor job applicants who say they “have a long history of winning” in everything they set out to do? Not necessarily. Great startup employees adapt well to shifting priorities and don’t get easily discouraged from unexpected setbacks. Ask prospective employees how they handled career disappointments. Also, invest extra time into talking with prior bosses about a job candidate’s ability to manage frustration in a work setting. Simply stated, all startups need determined problem-solvers, not toxic finger-pointers.

5. Test performance. I’m a fan of long probation periods for recent hires in small businesses. If a new employee doesn’t fit in with the company rhythm or perform well during the first few months on the job, don’t delay in discussing your dissatisfaction. Another low-risk way to test prospective employee abilities is to create a project that can be completed as an independent contractor.

Here’s one last tip. I find that the most productive way to quickly sort through resumes, online or offline, is to have your written job criteria list on hand. If a candidate doesn’t meet your top three criteria for experience and expertise, then discard the person’s resume and move on. Hiring decisions are easy. It all comes down to this: If your game is football, don’t hire (and pay top cash for) the trophy-winning polo player.

Cheers

Akash Poddar

Family Business

Bridging the Gen Gap.. Its possible :)

         Family Businesses has a major contribution to the Indian Economy, apart from startups, family businesses enhances employment much more than the MNCs and giant corps does. There was a time when family business was labelled as "certain community idea" but things have changed now but challenges remain the same. I myself have been involved in my family's manufacturing business for quiet some time now and i have been facing quiet a few challenges which em sure most of you face as well. We cant blame the elders {father, uncle, grandfather} for their way of running business, because they have started it and are running it for decades, but now as we are taking up, there are certain changes in the work which we like to bring but is often not well taken by the elders, lets highlight some of the solutions to such problems which i have used myself and is really effective.

• Use external source: By this i mean try and bring letters or articles from newspapers or magazines or websites or blogs{like mine :-)} to show them the authenticity of the idea. Convincing them that such plan has been implemented somewhere and is successful will add a big push.
• Write down your idea: Instead of discussing it verbally, which may also lead to arguments, if you present the idea in paper using diagram or facts, it will make them hard to ignore what you have in mind. Plus it will also give them time to consider your contribution.
• Ask for your control: If there is a part or department at work where you think you can make a major contribution, ask for full authority. This will automatically make the elders focus more on that particular department and they will surely boost your morale.
• Fix a transition plan: Don't feel shy to talk to elders to make a transition plan (a plan that focuses on who will take over what). Indian children aren't very comfortable talking about it, but if there is not a proper transition plan, business may fall later and may often lead to courts.
• Focus on the chair: There are many people particularly in Indian businesses who have their eyes on the business and they will be willing to find loopholes so that they can take advantage of even a minor error, the business belongs to you, treat it like your baby and protect it, if you let loose now, in the long run it will kick your rear back.

    You may not always get full support, there will be times when your ego may get hurt but you have to be strong enough and get your work done. Every father will be proud of you once you show them the results, plus that director's remuneration package adds to your celebration :)

Cheers

Akash Poddar