Business Opportunities
Home-based Businesses
A home-based business, as defined by the U.S. Small Business Administration, is "a business that is conducted out of a residence with no other headquarters location." According to researcher Harry B.R. Beale in Home-Based Business and Government Regulation (Microeconomic Applications/SBA, February 2004), home-based businesses comprise about half of all U.S. businesses. More than two-thirds of sole proprietorships, partnerships, and S corporations are based in owners' TABLE 9.6 The safest and riskiest small businesses, 2002homes. About 52% of home-based businesses are in service industries, 16% in construction, 14% in retail trade, 5% in finance, insurance, or real estate, 4% in transport, communication, or utilities, 3% in manufacturing, 3% in wholesale trade, and 3% other. A full 78% of all businesses in the forestry, fishing, and hunting sector are home-based as are 92% of residential general contractors.
| TABLE 9.6 | ||||
|---|---|---|---|---|
| The safest and riskiest small businesses, 2002 | ||||
| Rank | Type of business | Industry | % with profits | % with losses |
| All sole proprietorships | All | 74.9% | 25.1% | |
| 1 | Surveying and mapping (except geophysical) services | services | 93.7% | 6.3% |
| 2 | Optometrists | health care | 93.0% | 7.0% |
| 3 | Dentists | health care | 91.8% | 8.2% |
| 4 | Certified public accountants | services | 91.2% | 8.8% |
| 5 | School and charter bus drivers | transportation | 90.8% | 9.2% |
| 6 | Special trade contractors | construction | 88.2% | 11.8% |
| 7 | Mental health practitioners and social therapists | health care | 87.8% | 12.2% |
| 8 | Physicians (except mental health specialists) | health care | 87.1% | 12.9% |
| 9 | Taxi and limousine service | transportation | 86.3% | 13.7% |
| 10 | Residential building construction | construction | 85.9% | 14.1% |
| 11 | Medical and diagnostic lab services | health care | 85.4% | 14.6% |
| 12 | Architectural services | services | 85.1% | 14.9% |
| 13 | Land subdivision and land development | construction | 85.1% | 14.9% |
| 14 | Child day care services | health care | 85.0% | 15.0% |
| 15 | Legal services | services | 84.6% | 15.4% |
| 16 | Administrative and support services | services | 84.6% | 15.4% |
| 17 | Home health care services | health care | 83.5% | 16.5% |
| 18 | Physicians (mental health specialists) | health care | 83.1% | 16.9% |
| 19 | Educational services | services | 83.0% | 17.0% |
| 20 | General freight trucking, local | transportation | 82.8% | 17.2% |
| 21 | Architectural, engineering, and related services | services | 82.7% | 17.3% |
| 22 | Drafting, building inspection and geophysical survey | services | 82.4% | 17.6% |
| 23 | Support activities for mining | services | 82.4% | 17.6% |
| 24 | Motor vehicle towing and other transportation | transportation | 82.0% | 18.0% |
| 25 | Personal and laundry services | services | 81.5% | 18.5% |
| 26 | Couriers and messengers | transportation | 81.0% | 19.0% |
| 27 | Machinery manufacturing | manufacturing | 80.9% | 19.1% |
| 28 | General merchandise stores | retailing | 80.9% | 19.1% |
| 29 | Religious, civic, professional and similar organizations | services | 80.6% | 19.4% |
| 30 | Chiropractors | health care | 80.4% | 19.6% |
| 31 | Nursing and residential care facilities | health care | 80.2% | 19.8% |
| 32 | Social assistance | health care | 79.9% | 20.1% |
| 33 | Publishing industries | information | 79.8% | 20.2% |
| 34 | Engineering services | services | 79.8% | 20.2% |
| 35 | Miscellaneous repair services | services | 79.7% | 20.3% |
| 36 | Real estate agents, managers and appraisers | real estate | 79.6% | 20.4% |
| 37 | Nonresidential building construction | construction | 79.5% | 20.5% |
| 38 | Automotive mechanical and electrical repair | services | 79.0% | 21.0% |
| 39 | Podiatrists | health care | 79.0% | 21.0% |
| 40 | Leather and allied products | manufacturing | 78.9% | 21.1% |
| 41 | Transportation equipment | manufacturing | 78.4% | 21.6% |
| 42 | General freight trucking, long-distance | transportation | 78.1% | 21.9% |
| 43 | Building material and garden supplies | retailing | 78.1% | 21.9% |
| 44 | Accounting services (except CPAs) | services | 77.9% | 22.1% |
| 45 | Forestry and logging | agri services | 77.7% | 22.3% |
| 46 | Food manufacturing | manufacturing | 77.5% | 22.5% |
| 47 | Scientific research and development services | services | 77.2% | 22.8% |
| 48 | Automotive equipment rental and leasing | rentals | 77.1% | 22.9% |
| 49 | Automotive body shops | services | 77.0% | 23.0% |
TABLE 9.6 The safest and riskiest small businesses, 2002 (CONTINUED)
| TABLE 9.6 | ||||
|---|---|---|---|---|
| The safest and riskiest small businesses, 2002 (CONTINUED) | ||||
| Rank | Type of business | Industry | % with profits | % with losses |
| 50 | Broadcasting and telecommunications | information | 76.8% | 23.2% |
| 51 | Outpatient care and miscellaneous health practitioners | health care | 76.6% | 23.4% |
| 52 | Credit intermediation and related activities | finance/insurance | 76.6% | 23.4% |
| 53 | Water transportation | transportation | 76.3% | 23.7% |
| 54 | Plastics, rubber, clay and glass products | manufacturing | 75.8% | 24.2% |
| 55 | Nondurable goods (including food, chemicals, etc.) | wholesale | 75.8% | 24.2% |
| 56 | Paper products | manufacturing | 75.7% | 24.3% |
| 57 | Insurance agencies and brokerages | finance/insurance | 75.3% | 24.7% |
| 58 | RV parks and recreational camps | accommodation | 74.4% | 25.6% |
| 59 | Other activities related to real estate | real estate | 74.2% | 25.8% |
| 60 | Waste management and remediation services | services | 74.1% | 25.9% |
| 61 | Other insurance related activities | finance/insurance | 73.8% | 26.2% |
| 62 | Management, scientific, and technical consulting | services | 73.6% | 26.4% |
| 63 | Electrical equipment, appliance, and components | manufacturing | 73.5% | 26.5% |
| 64 | Apparel | manufacturing | 73.0% | 27.0% |
| 65 | Food and beverage stores | retailing | 72.9% | 27.1% |
| 66 | Amusement, gambling, and recreation industries | entertainment | 72.9% | 27.1% |
| 67 | Printing and related support activities | manufacturing | 72.7% | 27.3% |
| 68 | Market research and public opinion polling | services | 71.3% | 28.7% |
| 69 | Durable goods (including machinery, wood, etc.) | wholesale | 71.1% | 28.9% |
| 70 | Investment bankers and securities dealers | finance/insurance | 70.9% | 29.1% |
| 71 | Auto services (including oil change shops and car washes) | services | 70.3% | 29.7% |
| 72 | Computer systems design services | services | 70.2% | 29.8% |
| 73 | Other miscellaneous services | services | 70.2% | 29.8% |
| 74 | Fabricated metal products | manufacturing | 69.6% | 30.4% |
| 75 | Advertising and related services | services | 69.5% | 30.5% |
| 76 | Furniture and related products | manufacturing | 69.2% | 30.8% |
| 77 | Food services and drinking places | accommodation | 68.9% | 31.1% |
| 78 | Rooming and boarding houses | accommodation | 68.5% | 31.5% |
| 79 | Testing laboratories | services | 68.1% | 31.9% |
| 80 | Medical equipment and supplies | manufacturing | 67.8% | 32.2% |
| 81 | Electronic and appliance stores | retailing | 66.8% | 33.2% |
| 82 | Furniture and home furnishing stores | retailing | 66.7% | 33.3% |
| 83 | Rental and leasing services | rentals | 66.6% | 33.4% |
| 84 | General rental centers | rentals | 66.2% | 33.8% |
| 85 | Lessors of real estate (including miniwarehouses) | real estate | 66.0% | 34.0% |
| 86 | Specialized design services | services | 65.8% | 34.2% |
| 87 | Motor vehicle and parts dealers | retailing | 65.8% | 34.2% |
| 88 | Heavy construction | construction | 65.8% | 34.2% |
| 89 | Information services and data processing services | information | 65.5% | 34.5% |
| 90 | Investment advice and other financial activities | finance/insurance | 65.1% | 34.9% |
| 91 | Air and rail transportation | transportation | 64.9% | 35.1% |
| 92 | Wood products | manufacturing | 64.1% | 35.9% |
| 93 | Fishing | 64.0% | 36.0% | |
| 94 | Motion picture and sound recording | information | 63.9% | 36.1% |
| 95 | Hotels, motels, and bed and breakfast inns | accommodation | 63.2% | 36.8% |
| 96 | Gasoline stations | retailing | 62.9% | 37.1% |
| 97 | Commercial and industrial equipment rental | rentals | 62.6% | 37.4% |
| 98 | Other ambulatory health services (including ambulances) | health care | 61.7% | 38.3% |
| 99 | Securities brokers | finance/insurance | 60.1% | 39.9% |
According to Beale, most home-based business owners work alone. Nine out of ten home-based businesses have no employees; 7.2% have between one and five employees; 1% report having five to nineteen employees; and 0.2% have twenty employees or more. In addition, most of these businesses are quite small in terms of receipts. Most (77%) have gross receipts less than
TABLE 9.6 The safest and riskiest small businesses, 2002 (CONTINUED)
| TABLE 9.6 | ||||
|---|---|---|---|---|
| The safest and riskiest small businesses, 2002 (CONTINUED) | ||||
| Rank | Type of business | Industry | % with profits | % with losses |
| SOURCE: Patrick O'Rourke, "The Safest and Riskiest Small Businesses," in Useful Business Statistics, Bizstats.com, 2003, http://www.bizstats.com/sprisk2.htm (accessed January 10, 2006) | ||||
| 100 | Clothing and accessories stores | retailing | 59.5% | 40.5% |
| 101 | Securities and commodity exchanges | finance/insurance | 59.1% | 40.9% |
| 102 | Performing arts, recreation and related | entertainment | 57.6% | 42.4% |
| 103 | Utilities utility | services | 57.3% | 42.7% |
| 104 | Chemical manufacturing | manufacturing | 56.8% | 43.2% |
| 105 | Sporting goods, hobby, book, and music stores | retailing | 55.0% | 45.0% |
| 106 | Support activities for agriculture and forestry | agri services | 54.9% | 45.1% |
| 107 | Oil and gas extraction | extraction | 54.3% | 45.7% |
| 108 | Miscellaneous store retailers | retailing | 50.7% | 49.3% |
| 109 | Textile and textile product mills | manufacturing | 50.5% | 49.5% |
| 110 | Health and personal care stores | retailing | 49.5% | 50.5% |
| 111 | Other miscellaneous manufacturing | manufacturing | 48.8% | 51.2% |
| 112 | Nonstore retailers | retailing | 48.8% | 51.2% |
| 113 | Videotape and disc rental | rentals | 48.4% | 51.6% |
| 114 | Primary metal industries | manufacturing | 41.0% | 59.0% |
| 115 | Nonmetallic mineral mining and quarrying | mining | 38.3% | 61.7% |
| 116 | Commodity contracts brokers and dealers | finance/insurance | 36.6% | 63.4% |
| 117 | Computer and electronic products | manufacturing | 35.4% | 64.6% |
| 118 | Animal production (including pet breeding) | breeding | 34.5% | 65.5% |
| 119 | Scenic and sightseeing transportation | transportation | 33.8% | 66.2% |
| 120 | Hunting and trapping | hunting/trapping | 23.6% | 76.4% |
The 1999 U.S. Small Business Advocacy report Homebased Business: The Hidden Economy (http://www.sba.gov/advo/research/rs194tot.pdf) gathered information from 125,000 businesses and remains the most extensive consideration of the demographics of home-based business in the United States. Included in the sample were businesses owned by women (33%); by nonminority men (59%); by African-Americans (3%); by Hispanics (4%); and by "other minorities," mainly Asian and Pacific Islanders, and Native Americans or Alaska Natives (4%).
Based on 24.8 million nonfarm business tax forms filed in 1998, the SBA report estimated that the number of home-based businesses had increased between 11% and 33% (from nine million to ten-twelve million) between 1992 and 1999. Among home-based businesses, 90% are sole proprietorships; only 2.1% are franchises. More than 86% of home-based businesses are likely to be run by the founder, as compared with 72% of businesses that are not based in homes.
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Jobs and Career OpportunitiesCareers and Occupations: Looking to the FutureBusiness Opportunities - Business Starts, Business Size, Business Failures And Terminations, Safest And Riskiest Businesses, Number Of Businesses