Starting or buying an existing business brings significant risk, one of which is business failure. But the financial rewards and sense of accomplishment from business ownership outweigh these risks, and that’s why entrepreneurs take the leap.
While every business sector will always face challenges, there are some businesses that are less likely to fail based on their inherent attributes: necessity, recurring revenue, diversification, a well-defined market, stability, or recession-proof. That’s what we mean when we say, ‘businesses that never fail’.
This article will list the top 10 businesses that never fail. Although businesses are never immune to turbulence, there are some sectors that are less sensitive to socioeconomic, political, and environmental challenges.
We’ll cover the following businesses that will never go away:
- Real estate
- Transport
- Funeral homes
- Nursing and care services
- Agriculture
- Launderettes
- Payment processing
- Insurance services
- IT Support
- Food
Before we begin our analysis, it’s important to understand the reality of business failure rates in the UK. Close to 60% of start-ups fail in the first three years, and roughly 20% fail in the first year. Despite this gloomy statistic, it is possible to build a resilient business. To do this, you need to craft a solid business plan and understand the reasons behind business failure. We’ll offer more resources on building and growing a bullet-proof business toward the end of this article.
Now, let’s dive into fail proof business ideas that offer services everyone needs.
10 businesses that never fail
Although business success is never guaranteed, here are 10 businesses and industries with the lowest failure rates.
Real estate
Real estate includes property investment, development, advisory, management and leasing.
The UK’s real estate market is extremely attractive, boasting capital appreciation, high demand for property, and significant rental yields. In 2022, the real estate sector had the highest GVA (gross value added), generating nearly £270 billion.
Although it is a tough sector to enter, it’s one of the most stable industries that will always be in demand, particularly in major cities like London, Manchester, and Glasgow.
Transport
The UK transport sector is a fundamental industry and includes a diverse range of transport opportunities: warehousing and support, road freight transport and removal services, postal and courier services, railways, and air and sea transport.
The costs to start a small transport business are significant, but it is a feasible and scalable business if you play your cards right. April through to December are busy months for transport-related businesses. Haulage Exchange is a great digital platform for new business owners looking to advertise their fleet and grow their client network.
Recent statistics demonstrate that the public transport sector can expect a CAGR of 2.84% between 2023 and 2027. Despite the sector facing intense challenges, cash flow improvements are possible through effective transport management systems (TMS).
Funeral homes
The truth is that funeral homes are for-profit businesses, and the industry does offer a wide variety of career opportunities. It may seem distasteful to profit off a bleak reality of life, but that is why it is crucial to offer a supportive, affordable, and respectful service – a celebration of life.
The funeral market is very competitive, with three big corporations dominating UK market share alongside many small, independent funeral directors. Nonetheless, it is a profitable business to own due to the UK’s growing ageing population.
Senior healthcare services
The healthcare industry is considered one of the most stable industries. This comes as no surprise. It’s an essential service-based industry that has experienced significant growth over the past few years.
Healthcare businesses offer a diverse range of opportunities, with at-home care becoming increasingly popular. In 2022, care home operators experienced a 5% jump in occupancy and increased profitability.
While starting or buying an existing healthcare business is a great choice for entrepreneurs, investing in a care-related franchise is also a great, alternative route into business ownership.
Agriculture
The UK agriculture sector is an imperative part of the economy, and it includes a wide range of different businesses: farming, agriculture consultancy, nurseries, farm management, pastoral farming, honeybee farming, biofuels... the possibilities are endless.
Investing in an agriculture-related business means you’ll be joining an economic powerhouse that employs nearly half a million people and contributed £11.2 billion to the UK economy in 2021. Recent statistics also demonstrate that 21% of all UK farms made an average profit of £75,000 or more. Dairy and poultry farms were the most profitable.
Although starting or buying a farm will pose significant challenges, it is considered one of the most profitable industries that experiences consistent demand.
Laundrettes
Laundrettes that are located in high-traffic areas experience low failure rates. They offer an essential service that requires minimal labour costs and easy management. While net profits will vary based on location, it’s a common understanding that laundry businesses are sustainable, replicable and can leverage other sources of income simultaneously (like detergents, snacks, coin exchange or credit).
A laundrette’s success rate is far higher than most industries, attributed to a consistent cash flow and many revenue-boosting strategies. While utilities and machine repairs can make a dent in your profits, buying a laundrette can be one of the lowest risk businesses for entrepreneurs.
Payment processing
Every business has payments to process, and in an era marked by digital solutions and automation, there’s no surprise that digital payment processing might become one of the most profitable industries in the future.
As card payment preference and e-commerce continues to skyrocket, payment processing systems have experienced a boom, expected to reach an industry revenue of £8.9 billion by 2024. It’s also grown at a compound annual rate of 7.6%.
Payment processing is a service that will always be in demand, and it's important that new business owners focus on revenue growth through product differentiation that focuses on changing customer needs.
A report by EY also indicates that experts expect an increase in M&A activity and venture capital investment into the payment processing industry.
Insurance services
Insurance related businesses offer a diverse range of products related to cars, personal health, work, homes, and disabilities. Insurance businesses form part of one of the most stable and sophisticated industries in the UK. For example, in 2022, 69% of UK adults had a contents insurance plan, and 68% had a motor insurance plan.
This indicates a clear demand for insurance products, making it a business that will always be in demand. Of course, an insurance business’s profits will depend on the number of policies issued, premiums charged, ROI, business costs, and claims.
Motor vehicle and property insurance make up most of the market, and the general insurance market grew by 1.6% in the last five years, expected to reach a market value of £75.6 billion at the end of 2023.
IT services
The IT services market has witnessed incredible growth over the last few years. It’s expected to have a CAGR of 10.36% until 2028, with a forecasted market value of £96.33 billion ($117.09 billion) in the same year.
If you’re looking to avoid business failure, then investing in an IT service business could be a smart move. Adoption of SaaS (software as a service) and cloud-based products across UK companies has accelerated demand for IT services.
The IT service market is rapidly expanding, creating significant opportunities for tech-savvy entrepreneurs to join a business with one of the lowest failure rates.
Food
To survive, we need food, and that makes the food sector a fundamental industry. The food industry is the biggest manufacturing sector in the UK, and includes multiple food-related business opportunities that entrepreneurs can invest in.
At present, the food industry’s total business investment increased by 8% from 2021, totaling an incredible £4.3 billion. Its entire output is valued at £33 billion! The food and drink industry has commercial maturity, with developing markets and premium products becoming increasingly popular.
There’s no denying that this sector faces immense challenges brought on by inflation, recent energy price hikes, and the cost of living. But with the right product, defined market, and marketing strategies, starting or investing in a food-related business can bring profitable returns.
Helpful FAQs
What businesses are least likely to fail?
Businesses with the lowest risk of failure include:
- Real estate
- Laundromats
- Senior care centres
- Self-storage
- IT services
What are the top five reasons businesses fail?
Business failure is a common reality, and there are many reasons for a failing business. The top five reasons for business failure include:
- Financial problems
- Lack of vision
- Poor management
- Evasive toward learning and adapting
- Ineffective marketing strategies
What industries will never die?
Industries that will never die, despite macroeconomic challenges, include:
- The food and drink industry
- The pharmaceutical industry
- The healthcare industry
- Professional services (IT, accounting, legal, engineering)
Bottom line: businesses that never fail
When you start or buy a business, you’re also facing the potential risk of business failure. However, investing in a business that has a low failure rate gives you a better chance at success.
The businesses and industries we’ve mentioned above all have something in common: their inherent attributes reduce their risk of failure.
But even inherent attributes cannot guarantee success. That’s why it’s important to adapt, upgrade and cater to ever-changing consumer preferences and industry fluctuations. Being conscious of the cyclical nature of your industry is essential, and implementing strategic ways to mitigate risks will bring you one step closer to keeping your doors open and increasing your profits.
Now that you’re up to speed on the most low-risk business ventures, it’s time to explore thousands of profitable businesses for sale in our most popular categories.
If you’d like more helpful resources on improving your business, you can read our article on tips to grow your business and strategies to improve your cash flow.
We wish you all the best on your new business venture!
@Be_theBoss