If you want to be successful in business you will need to know which business you should venture in for starters.
Knowing which business is highly profitable in 2016 will go a long way in helping you make that crucial decision on which business to invest your time, effort and finance in.
In 2016 statistics provided by Sageworks a financial data services business that examines the net profit margins of a large number of small businesses in the United States have shown that tax and accounting services small scale businesses make an average of about 18.4% in net profit margins and this business tops the list of the most profitable small scale businesses in the U.S.
The top 10 list of profitable small scale businesses in the U.S for 2016 also include the following;
- In second place is company management services which has a 15.5% net profit margin.
- Coming in at a close third is real estate services with a 15.2% net profit margin.
- In fourth place we have automobile equipment rental services with a 14.55% net profit margin.
- Legal services and law firms make a net profit margin of about 14.48% and are fifth on the list.
- In sixth place is medical services and the office of the dentist has a 14.41% net profit margin.
- Electricity generation, transmission and small scale distribution makes a net profit margin of 14.02% and is in seventh place.
- In eight place is real estate leasing services which comes in with a net profit margin of 14.01%.
- Other medical services follows in at ninth place with a 13.03% net profit margin.
- In tenth place is the office of the physician which has a net profit margin of 13.01%.
Sageworks say that the average net profit margin across all the small businesses is about 12.82%.
So What Generally Makes These Small Businesses Profitable?
Jenna Weaver an analyst from Sageworks says that the main reasons why these businesses top the list of profitable ventures is because of the following;
- They are all primarily run on human capital.
- They have low start-up cost and overheads.
- You can work from home for most of these businesses and therefore you save money from possible rent payments, utility bills and furnishing expenses.
It’s important to note that while profits are a big incentive for starting a business you will also have to engage in that business that actually matches your skill set. If you don’t have any legal training and experience it would be highly risky and unwise to start-up a legal firm for example.
You also need to acquire the requisite knowledge and training necessary to be successful in your choice of business.
Find out all the necessary information about starting and operating your business within your base of operation, information like licensing, taxation and local or state policies will help you work professionally and within the confines of the law.