Recession Busting Home Businesses

When it comes to the recession, the old adage “What doesn’t kill you makes you stronger” rings true for many small businesses throughout the U.S. And for the 2009 Home-Based 100 winners in our Recession Busters category, they proved that is definitely the case, by not only powering through the storm, but also starting businesses from scratch in the middle of what amounts to the worst recession since the Great Depression.

But this isn’t abnormal; entrepreneurs have always been a driven group. Various economic low points of the past century have never held them back. In fact, a number of companies and products were actually launched during tough times: Campbell’s Soup debuted in the 1890s, IBM released the personal computer in 1981 and Apple introduced the first iPod in 2001. All of these eras were tough economic times.

PERFECT TIMING

Piece that little history lesson together, and our conclusion is that recessions are opportunity-rich times. Banquet Tables Pro founder Alex Steiner, 2009’s winner in the Recession Busters category of the StartupNation Home-Based 100, couldn’t agree more. Though he had a secure job in web design and marketing, he saw the current economy as “his chance,” he says. “When times are tough, you either step up or get out of the way!” He obviously chose the former.

Steiner launched his Tampa, Florida, banquet furniture company this past January with just $450. Despite opening his home-based business in a somewhat recession-sensitive sector, he’s seen immediate results. Within the first three weeks live, he made more money than what he was making a month as an employee, and “cash has grown by more than 20,000 percent,” Steiner says. “When the economy starts moving again, the banquet industry is going to boom with all the corporate parties, [new] restaurants and more.”

“[Entrepreneurs] are optimistic by nature,” says Neal Creighton, CEO of RatePoint Inc., a provider of feedback and online reputation management services. “And there’s a good small-business spirit in this country.” A recent survey by the company found that even though 51 percent of SMBs reported a decline in sales due to the economy, 58 percent expect to see growth in 2010. “A recession is a great time to get started,” says Creighton, adding that he started his first company during the 2001 recession. “If you’re fresh, you can see the ways to differentiate yourself from competitors or deliver your product for cheaper.” Doing this includes leveraging technology, free web tools and your home-based business status.

It’s a matter of finding those threads of opportunity out there. A Top Ten winner in the 2009 Recession Busters category is proving that it’s doable, too. When Claire Eads launched her home-based company, Bebe Dulce, last year, she was only following character. She felt confident about the need for her handmade baby gifts despite the economy. “Everyone buys baby gifts,” she points out. “And I feel that even though we’re going through a recession, consumers will spend a little more on a gift for someone else vs. spending a little more on themselves.” Aspen, Colorado-based Bebe Dulce has had significant growth since launch, seeing a 25 percent increase in sales a month and expanding to nearly 25 stores in four states.

CLEAR SKIES AHEAD

Creighton completely agrees with us. “Tough economic times help small businesses grow stronger and learn where to be more efficient,” he says. “You’re forced to be more innovative.” Eads has taken advantage of some of the free tools Creigton mentioned: Most of her marketing is done online with free web tools. And being a home-based business owner has contributed significantly to the success of most of our Recession Busters. Eads cuts a lot of costs that way, including office space rent, gas for the commute and full-time daycare. Steiner, whose home office now has four computers and takes up about 60 percent of his place, saves on office space, too.

Home-based business or not, while other businesses are making cuts or shutting their doors, our Recession Busters are plugging away like never before. Says Creighton, “You put forth your best when your back is against the wall.” And our top 10 are evidence of exactly that; it’s just that their wall is most likely in a kitchen, bedroom or home office.