The 7 WORST Businesses To Start in 2023

TL;DR

Avoid starting a clothing company, franchise, fad products, restaurant, vending machine, loan-dependent or pyramid scheme businesses.

Transcript

okay so today we're doing something a bit different we're talking about some of the worst businesses that you could start especially as a beginner I'm going to give you a list of reasons why these businesses are ones you probably want to avoid some of the risks associated with them uh and let's just get into this video right now um now keep in mind... Read More

Key Insights

• 😘 Clothing companies have low profit margins, making it difficult to attract customers.
• ☄️ Franchises may offer brand recognition but come with limited scalability and potential control by the corporate entity.
• 🥺 Fad products have a short lifespan, and trying to chase trends can lead to inventory problems and financial losses.
• 😘 The restaurant industry is highly competitive, with low profit margins and additional risks such as pandemics and lockdowns.
• 👨‍💼 Vending machine and ATM businesses have limited profit margins and may not be easily scalable to a large business.
• 👨‍💼 Being cautious with loans for business startups can prevent personal financial risks associated with loan guarantees.
• ❓ Pyramid schemes or MLMs are not sustainable or profitable for most participants and should be avoided.

Questions & Answers

Q: Why should I avoid starting a clothing company as a beginner?

The clothing industry has low profit margins and it's challenging to attract customers, especially if you don't have a strong personal brand or design expertise.

Q: What are the drawbacks of starting a franchise business?

Franchises may make you feel like a manager rather than a business owner, have limited scalability, and the corporation may take a significant portion of your revenue as royalty fees.

Q: Why should I avoid starting a business based on fad or trend products?

Fad products have a short lifespan, and as more manufacturers flood the market, prices drop, leaving you with inventory that you paid a premium for but can't sell at a profit.

Q: What are the risks of starting a restaurant business?

Restaurants have low profit margins and face intense competition due to a saturated market. Factors like pandemics and lockdowns also pose additional risks.

Q: What are the challenges of running a vending machine or ATM business?

The profit margins for these businesses are low, and when factoring in your time and costs associated with restocking machines, it may end up being more like a job than a scalable venture.

Q: Why should I avoid getting a loan for my business?

Taking a loan for a business can be risky, as failure to generate profits can lead to personal financial loss, such as losing your house or car if you have personally guaranteed the loan.

Q: Why are pyramid scheme businesses not recommended?

Pyramid scheme or MLM businesses rely on recruiting more participants who pay fees to join, making it unsustainable and with limited profitability. Only a few people at the top make significant money.

Q: What is the key message for starting a business?

It is essential to avoid buying yourself a job and consider scalability when selecting a business. Can you hire others to run the business and still make a profit?

Summary & Key Takeaways

• Starting a clothing company can be challenging due to low profit margins and difficulty in attracting customers.

• Franchises may make you feel like a manager rather than a business owner, with limited scalability and potential issues with profit margins.

• Trend or fad products can lead to inventory problems as the market gets saturated and prices drop.

• Restaurants have low profit margins and are highly competitive, making them risky business ventures.

• Vending machine and ATM businesses have limited profit margins and may end up being more like a job than a scalable venture.

• Taking loans for business startup can have risky outcomes, and pyramid schemes or MLMs are not sustainable or profitable.