Best business opportunities for 2007: are you ready to pursue your entrepreneurial dreams? We've identified this year's five most promising markets.
"When my wife, Mweia, and I founded the company, it was based on my personal life and the transformations that I made. I was 320 pounds and I tried a lot of different things to lose weight. I was a vegetarian for 13 years, but the weight never went down because I was making unhealthy choices," Uqoezwa says. "So we came up with The Raw Choice as a reminder of the power in all people to make better dietary choices, but also to inspire, support, and educate them in lifestyle changes that they can make on a day-to-day basis."
Uqoezwa, 29, did his research on health and nutrition and became completely dedicated to living an organic lifestyle. As a result, he lost 120 pounds in seven months. In 2003, he left a position as vice president of business development at Excel Personal Development and started The Raw Choice.
Using $160,000 in personal savings, Uqoezwa began holding one-on-one classes and small workshops to teach people about making healthier lifestyle choices. He also introduced three organic products: Natural Regenerating Green, a green food supplement product, Agave Nectar, an all-natural organic sweetener extracted from the Salmiana Agave Cactus plant found in South America, and Himalayan Crystal Salt, imported from the Himalayan Mountains.
Today, the 10-employee company has an estimated $1.2 million in revenues for 2006 and 18 products, including Tibetan Gogi Berries, Monukka Raisins, Turkish Mulberries, and Peruvian Raw Chocolate. The products, which range in price from $5.99 to $17.99, are all certified organic and imported. They are sold in more than 1,000 retail stores nationwide, including Whole Foods and Wild Oats, and on the company's Website (www.TheRawChoice.com). "The size and diversity of the market is bigger than ever before, so the opportunity to go into multiple markets is greater," says Uqoezwa. But one of the biggest challenges has been importing product. Sometimes it takes six months to bring a product to the marketplace.
Uqoezwa is capitalizing on a strong health and wellness industry that is emerging as one of the hottest sectors for business opportunities in 2007. Today, a growing number of health-conscious consumers are making smarter food choices and discovering that proper diets will lead to happier and healthier lives. "The outlook for our business and the industry as a whole is definitely positive," says Uqoezwa. "As we approach 2007 and begin to look beyond that, we see that people are more aware that a change is needed now if we want to enjoy better health in years to come."
The Raw Choice is positioned for growth in one of five sectors that BLACK ENTERPRISE has pinpointed as the most promising industries for 2007. These categories are all poised for fast growth due to high demand for their products and services. The sectors--health and wellness, homeland security, construction/contracting, business services, and portable technology--show promise for entrepreneurs who are ready to roll up their sleeves and work hard.
[Health & Wellness]
HERE'S TO YOUR HEALTH!
Few can argue the following facts: The nation's girth is increasing and the folks who try to curb this growth are getting richer. As more Americans lead sedentary lives, exercise becomes even more of a pipe dream than ever.
Smart entrepreneurs know this and are turning a national problem into a business opportunity. According to the Natural Marketing Institute's annual research study, Health and Wellness Trends Database, in 2004 the industry reached $68 billion in retail sales of consumer packaged goods (vitamins, minerals, herbal and dietary supplements, and organic foods and beverages). In 2005 that number reached $79 billion, a growth of more than 15% from the previous year. "Fifty-six percent of organic product users are actively involved in health and wellness in varying degrees and across various product segments," says Maryellen Molyneaux, NMI's president. The group estimates total health and wellness sales hit $90.49 billion in 2006. The industry is expected to grow steadily through 2007 and beyond.
According to the International Spa Association, the spa industry is an estimated $11.2 billion industry. Medical spas are the fastest-growing segment, expanding at a rate of 109% compared to a 26% growth rate for spas overall. Personal fitness franchises, especially those geared toward women, are also on the rise. For example, Liberty Fitness, which opened in 2002, has 61 women's fitness center locations in 16 states and plans to open another 1,500-plus in the next five years.
Edward Behrens, chairman of SCORE's Southern New Jersey chapter, says that while health and wellness is on the minds of a lot of people, the typical customer base turns over every six to eight months, whether it's for supplements or going to the gym or anything else. "In other words, you have to find new customers on a continuing basis," says Behrens. "However, if you can identify exactly who your customer base is and what they need, you can be successful."
SECURING YOUR BUSINESS
Businesses that can help Uncle Sam fight the war on terror are in high demand these days. According to industry tracker Homeland Security Research of Washington, D.C., governments and businesses worldwide will spend $59 billion in 2006 on the fight against terrorism. Spending is expected to double by 2010 and the market for security goods and services is expected to increase to $178 billion by 2015.
And while large corporations are bound to benefit, so will smaller companies working on government contracts. In fact, the U.S. Department of Homeland Security spent $28 billion during the last fiscal year and handed out 115,000 contracts (33% of all contract dollars went to small companies). Also, the department requires that larger companies subcontract 40% of the contract's value to smaller shops.
Homeland security prospects look promising in services that specialize in risk assessment, surveillance products, and technology devices to prevent chemical, biological, and radiological threats to U.S. borders, railways, seaports, air travel, and industrial and nuclear plants.
BUILDING A FUTURE
New and existing home sales took a beating in 2006, thanks to increased interest rates and a downturn in the housing market. But commercial construction, contracting, and home renovations are still thriving, particularly in the Gulf States and other areas ravaged by the hurricanes of 2004 and 2005.
According to McGraw-Hill Construction's 2006 Construction Outlook, an industry study, new building projects were estimated to reach $654 billion in 2006, a 3% increase from the previous year. And this year, the Federal Emergency Management Agency awarded more than $600 million in contracts to three minority-owned firms in the Gulf region.
According to the June 2006 Global Insight/Home Improvement Research Institute Forecast, home improvement product sales are expected to increase by 8.8% to $312 billion. Another 2.2% increase is expected in 2007, and total market growth from 2008, to 2010 is projected to average an increase of 5% per year.
"It's a good outlook for contractors because we're seeing an increase of what we call buy-it-yourself, where the consumer buys it and has a pro install it," says Richard Johnston, senior research analyst at the Home Improvement Research Institute. "We're also seeing an increase in what we call the 'pro.' That's where the homeowner hires the professional to buy and install the items. That's going to continue, with the baby boomers driving the market."
AT YOUR SERVICE
According to the latest figures, there are more than 25 million businesses in the U.S.--a figure that's growing at a rate of 2% annually. Not every business keeps its services in-house. Many companies, large and small, outsource several services to save money. Cleaning services, for example, are extremely popular. According to the Freedonia Group, an industry market research firm, the U.S. commercial and residential cleaning service business is a $46 billion industry. The demand for the service is expected to grow by 5.5% annually through 2009. Cleaning franchises can cost as little as $1,000 to start (JAN-PRO Cleaning Concepts offers a package for just $950) and can be operated from home.
Increased outsourcing means increased opportunities for entrepreneurs. "Small businesses tend not to collaborate, form strategic partnerships, or leverage industry relationships and resources. This creates opportunities for new entrepreneurs to provide services that help other entrepreneurs save time and make more money," says Franne McNeal, significant business results coach for HR Energy, a business coaching firm. "In my line of work, I'm finding that people are becoming business coaches and they are coaching by phone, tele-seminars, and Web-based seminars."
PORTABLE WAY TO GO
By now, it's probably safe to say that anyone who doesn't own--or who hasn't used--a cell phone is living under a rock. According to technology research firm Gartner Inc., mobile phone sales in 2005 reached 779 million units, a 16% increase over 2004. Technology research firm IDC reports that in the first quarter of 2006 alone, 226.7 million units were shipped out to mobile phone users, increasing worldwide shipments by 26%.
By 2009, mobile phone shipments are expected to surpass 1 billion units. All of this can translate into a wealth of opportunities for small business owners, particularly in the area of cell phone accessories such as phone cases, faceplates, headsets, and other items. The strong demand for feature-laden cell phones and mobile devices is providing revenue streams for entrepreneurs looking to cash in, such as manufacturers of cell phone add-on products, Web developers that deliver mobile content for media devices, or network operators and wireless developers offering systems and data services.
Credit Americans' thirst for technology and convenience with helping to drive that trend. "If you can develop products and services to support the technology industry, you have a great business opportunity," says HR Energy's Franne McNeal, who points to a cell phone case maker as proof. "Instead of making handbags, the company looked at the growth of the technology industry and found a portable technology product that everybody uses. Now it has a very successful niche business."
A BRIGHT FUTURE FOR TECHNOLOGY SUPPORT SERVICES
Leslie McNeal knows a good business opportunity when she sees one. In 2001, after seeing a need for qualified, technical staffers among major companies, she broke away from a corporate career and began contracting to provide such services.
Ready for a taste of entrepreneurship and realizing that big corporations were more apt to hire contract workers than fulltime employees, McNeal, 35, and her husband, Nathan, 36, made an investment of $30,000 five years ago to start Kennesaw, Georgia-based McNeal Professional Services, which relies on a national network of technical contractors to fulfill the staffing needs of its corporate clients.
In 2002, Nathan left an engineering consulting position at another firm to join his wife and start a new division that would work with major telecommunications carriers to design, optimize, test, and improve wireless phone coverage. "When you see the 'Can you hear me now?' Verizon commercials," says Nathan, "we're the folks who are actually doing the work to optimize those cell phone networks."
The gamble that the McNeals took when they kissed their steady paychecks goodbye and jumped into business ownership has paid off. Last year, their 40-employee firm brought in $3.8 million in revenues, and in 2007 it expects $4.6 million. "We see significant opportunity ahead in both sectors," says Leslie, "and continued growth for our company, and for those that can ferret out the opportunities and fulfill customer needs in a professional, timely manner."
McNeal Professional Services is sitting pretty in the high-growth technology business services category. To sustain that growth, the McNeals are always scouting for new clients and opportunities.
Estimating a startup cost of about $150,000 for the wireless engineering aspect of the business, the McNeals see opportunity for ambitious entrepreneurs who are willing to "put in a lot of hours" to start and grow companies in those sectors.
McNeal says that a tighter job market and the fact that companies are looking to augment their existing staff, without having to hire full-time employees and pay benefits for them, has created an ongoing demand for technical staffing services.
High-Growth Market Resources for 2007
[Health & Wellness]
The International SPA Association
A worldwide community of spa professionals, product manufacturers, and service providers www.experienceispa.com 888-651-4771
A franchise that emphasizes women's total body health, fitness, nutrition, and wellness www.libertyfitnessfranchise.com 888-521-2582
Department of Homeland Security Small Business Procurement Assistance
Designed to provide the links to contracts, grants, and research and development resources www.dhs.gov/xopnbiz/smallbusiness 202-282-8000
Federal Business Opportunities
The point-of-entry for federal government procurement opportunities of more than $25,000 www.fedbizopps.gov 877-472-3779
National Association of Home Builders
A trade association that promotes national housing policies. Visit this site to find strategic partners and resources that serve the industry. www.nahb.org 800-368-5242
Minority Business Development Agency
The Minority Business Development Agency is part of the U.S. Department of Commerce and was created specifically to foster the establishment and growth of minority-owned businesses in America. www.mbda.gov 888-324-1551
National Minority Supplier Development Council Inc.
This business membership organization lists regional councils that certify and match more than 15,000 minority-owned businesses with member corporations. www.nmsdcus.org 212-944-2430
Portable technology offers unparalleled business opportunities in selling devices, services, or accessories. Vist wireless phone company Websites such as www.ver izon.com and www.sprint.com and check out their wholesale and value-added reseller opportunities.
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|Date:||Jan 1, 2007|
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