When starting a new business you should consider the potential industries your company may have the best opportunity to compete in.
To help with this, we’ve compiled a list of the top 4 industries that show the most promise for startups in 2020. With the right combination of determination, passion, and creativity, your profitable business is just around the corner.
Why Transportation Industry Businesses are Trending
When you think of the recent advancements made in the transportation industry (self-driving Teslas, Uber, Lyft) it becomes clear that the transportation industry is hungry for growth and even hungrier for new talent.
Every person, company, and product relies on transportation daily—creating a powerful demand. As transportation becomes more intertwined with technology, there is a shift away from traditional services and towards startups with radical ideas.
Transportation industry projected growth
How to Stand Out
Transportation is becoming all about ease, accessibility, and technology. In order to differentiate yourself from the industry giants, start asking yourself how your company could harness trends to alleviate current pain points.
For example, Nomad rides, a rideshare app, is attempting to beat Uber with the strategy of putting their drivers first. By charging riders 20 percent less and giving drivers 20 percent more of their profits, they have a competitive advantage that could place them on the frontline.
Resources for starting a transportation business
Why tech startups are (still) trending
It’s no secret that technology has exploded in popularity—establishing itself as the backbone of companies like Apple, Samsung, and JP Morgan. With technology, businesses have instant access to customer data and are able to conduct meaningful research that keeps them a step ahead of competitors.
Tech industry projected growth
- The “in-vehicle” technology market is expected to grow 6 percent in 2020, to $18.5 billion.
- The global information technology industry is expected to grow at a rate of 3.7 percent in 2020, to $5.2 trillion.
- 44 percent of businesses plan to increase tech spending in 2020, up from 38 percent in 2019.
How to Stand Out
Differentiating yourself in the tech industry can seem like a daunting task, especially if you compare yourself to a company like Apple. When starting your business—think specialized and targeted. Instead of capturing the entire market with a unique idea, try targeting an underrepresented customer or industry.
One example is Even, a bank app, focused its technology efforts on providing financial help to those living below the poverty line. This demographic is historically neglected by more traditional banks. By focusing on them, Even has a target market that is untouched by competitors.
Keep in mind that tech businesses are successful all around the nation, not just in Silicon Valley. It’s often cheaper and more sustainable to build your app or software somewhere else. Some businesses are even building fully remote workforces to avoid the high costs of living and working in the highly saturated Bay Area.
Resources for starting a tech business
Health and Medical
Why Health and Medical Business is trending
Healthcare in the U.S has reached a turning point—where traditional services and facilities are facing extinction due to the rising preference for “convenient, personalized, and data-driven health.” The over 65 population is also set to double by 2030, as a result of the aging boomers, creating a record-breaking demand for elderly care.
Healthcare industry growth projections
- Global health care spending is expected to rise at a CAGR of 5 percent between 2019 and 2023
- Medical cost trends have been flat over the past two years, but are expected to increase by 6 percent in 2020
How to stand out
The current gaps in the health industry, including the deep pain points of high medical and insurance costs, leave large opportunities for startup success. Moving away from the traditional models and specializing in biotechnology, personalized health, or elderly care will align you with the populations’ current needs.
GoodRx, a telemedicine platform, for example, developed their business model after recognizing the burden high prescription drug costs place on individuals. Using technology that tracks pharmacy drug prices, they are able to offer their customers lower costs that aren’t otherwise accessible. By alleviating this common pain point, GoodRx becomes a necessary step in healthcare routines.
Resources for starting health and medical business
Green products and services
Why businesses related to green products are trending
As concerns about global warming and sustainability become increasingly prevalent, a more environmentally conscious population is coming into the consumer purchasing market. Green products have gained popularity in this landscape, by offering quality goods that have low environmental impacts.
Growth projections for businesses selling green products and services
- 50 percent of consumer packaged goods growth from 2013-2018 came from sustainability-marketed products.
- Sustainable product sales are estimated to reach $142.4 – $151.1 billion by 2021.
How to stand out
One of the biggest barriers in this industry is the intention-action gap that exists. According to a study, 65 percent said they want to buy products from brands that advocate sustainability, yet only about 26 percent actually do so. Closing this gap could be the key to unlocking the market potential.
Imperfect Produce, a produce subscription box that fights food waste, has effectively closed the intention-action gap by going straight to their consumers. Instead of trying to draw people to their website, this company actively sets up booths at farmer’s markets and college campuses. Doing so provides consumers with a visual reminder to achieve their goals, without having to go out of their way to seek out information.
Resources for starting a green products or services business
Build Your Brand With A Business Plan
A creative idea that is backed up by data and demand projections is well qualified to bring about profitable results, but a business plan is what will really drive your success. By following the outlined steps you will lock down your financials, design successful marketing and distribution strategies, and create a plan that is adjustable for future growth.