What are the most profitable small businesses?

If you are a small business owner or someone contemplating opening a small business you may be wondering what the most profitable small businesses are.This is especially crucial in today's economy when any business owner (large or small) takes an enormous risk to open and sustain a business.Financial experts advise that before opening any small business that doing your research, understanding your market and setting realistic goals in your business plan are crucial to maintaining and thriving with a small business. Knowing what small businesses are the most profitable can help you determine what direction your small business should take. So whether you are an established small business owner or looking to open a small business here is what you need to know about what are the most profitable small businesses-

• Types of profitable small businesses-Financial records indicate that the following types of small businesses have the highest profit margins.These small businesses are: dentists, accountants including tax preparation, bookkeeping and payroll services, investment advisors and portfolio managers, legal services and physicians. Interestingly financial records also show that these small businesses are also the least affected by a downturn in the economy.They continue to show that same types of profit margins despite any other outward economic influences.
• Why do these businesses thrive?A common key that connects these types of businesses is that they all provide a necessary service.It becomes quickly apparent that even if the economy is struggling people still need to see the dentist and doctor and have legal and financial services at their disposal.While retail businesses often are struggling during a recession (or other slow time in the economy) service based businesses (no matter how small) can continue to thrive. For prospective small business owners this must be a key point to consider.
• What can be learned from this?Obviously not everyone is a doctor, lawyer or dentist (nor should they be).But this trend of profitable small businesses shows that in order to be profitable other businesses should be asking themselves in what ways they need to re-structure their offering to meet the requirements of the environment. For example: restaurants can re-structure menus, specials and prices because people will still want to eat out (and do) but choose differently. This can be a great opportunity to launch offerings that better meet your customers' new requirements and behaviors.
• Marketing is key! Profitable small businesses understand that they must position themselves in the forefront of their market.While many of the small businesses listed above do require specialized training all the training in the world will not do you any good if you do not market your small business.For example: many dentists have now entered the world of online marketing in order to draw in new customers to their practice as they see many of their potential clients looking online to find a dentist in their area.Any profitable small business will understand who their target market is and market their small business directly to them.
• Customer service is crucial to being profitable.Any small business owner will tell you that their ultimate boss is their customer.If you are using a physician who does not listen to you or a tax accountant who is constantly late on promised work you will quickly move on to someone else. Savvy small business owners who are seeking to maximize profits will instill a high degree of customer service into every level of their organization. By providing a high degree of customer service a small business owner not only maximizes one-time profits but helps build a high degree of customer loyalty for returning business.