7 Small Businesses You Don't Want to Start

The title of this article is a bit misleading. These aren’t the absolutely worst ideas for starting businesses. They were fine ideas for starting a business in their day, as were film developing, video stores, dial-up internet services, and horse-drawn carriages.

But for some that day is gone and these are no longer necessarily good choices. Some are no longer good choices because their potential markets have been saturated . You can still start a business in a saturated market, but if you do you’ll have to find a specific niche you can target and/or have especially strong skills.

For others, times have changed and no matter how talented you are or how much you love the idea are, your new business is unlikely to be profitable.

Here, in no particular order, are businesses you don't want to start.

Computer Shop

Computer Motherboard
Image (c) Dave Mcleod

There hasn’t been a lot of money in selling systems for a long time as the margins on computer equipment have continued to shrink. Computer services, including repair, virus removal, on-site tech support, etc. are the money-making side of most small computer shops. But now even that market is getting saturated—and facing ever stiffer competition from retail chains such as Staples and Best Buy that also want a piece of the "computer help" market.

If you’re thinking of getting into this racket be prepared to branch out or operate without a storefront. One successful local shop offers smartphone repair services; many of the others have closed for good or converted their storefronts to home-based businesses and offer mobile-only service.

Pet Supply Store

Image (c) Dave Mcleod

Pet supply stores are another popular business idea that is getting difficult for the independent operator. Unless you live in a densely populated area (with lots of pets) where there’s no pet supply store within five miles, you’ve likely missed your chance to operate a lucrative pet supply store. Retail chains, grocery stores, vets and online sellers have pretty well eaten up this market.

There are still many other pet-related businesses you could start that could make money, though. See 18 Pet Business Ideas for inspiration.

Web Designer

Web Designer
Image (c) Hero Images / Getty Images

Ah, the glory days of web design, when all you needed to know was some HTML and have some basic design skills!  But this is no longer a business for beginners. Now you need knowledge of  CSS,  content management systems such as WordPress, graphics software, domains, search engine optimization, and ecommerce platforms—for starters.

And because it’s so easy to create a blog or website using applications and/or templates, the days of being able to make a living creating simple ‘placeholder’ websites are gone.

Driven by the growing popularity of mobile devices and ecommerce, the outlook for web designers is still positive, but it is not a good choice for someone who doesn’t have the requisite training and skills and is looking for a new business to start that has low barriers to entry.

Travel Agency

Image (c) Dave Mcleod

As with so many other businesses, the internet has had a huge impact on the travel industry—statistics show that the number of retail travel agencies has declined by 60% since the mid-1990's.

Budget-conscious travelers can scour online travel booking sites such as Expedia and get instant access to airfares, hotels, and transportation—why have someone else book your trip?

While the traditional retail travel agency is becoming extinct, there is still a demand for travel services in niche markets like cruises or high-end travel packages. There are also opportunities in the travel guide business if you are outgoing and have expertise in a particular travel destination.  

Appliance/Electronics Repair

Appliance Repairman
Image (c) George Peters / Getty Images

In the old days, refrigerators, stoves, washer/dryers and other appliances lasted for decades and were worth repairing when required. Now however, most appliances have a lifespan of less than 10 years and are prohibitively expensive to repair. If a broken appliance or television is not under warranty, it makes no sense to the consumer to spend hundreds of dollars to repair a five-year-old device when a brand new model can be had for a few hundred dollars more.

This combined with the general decline in the prices of appliances and electronics has decimated the number of independent repair businesses. Most manufacturers offer extended warranties on new appliances and warranty repairs are handled by designated warranty depots.

Clothing Store

Store Closing
Image (c) Kirby Hamilton / Getty Images

A visit to the clothing section of your local Costco store will tell you all you need to know about the demise of mom & pop clothing stores. For big-brand products, small clothing stores simply cannot compete with the discounted prices that large retail chains, big box stores, and online vendors such as Amazon can offer.

If your dream is to open a clothing store, focusing on high-end brands that the bigger retailers do not carry will give you the best odds of success.

Limousine Services

Booking a Ride on Uber
Image (c) Martin Dimitrov / Getty Images

The taxi and limousine industries are being crushed by ride-sharing companies such as Uber and Lyft who are revolutionizing the transportation industry with their affordable, easy-to-access ride services. Uber offers services in over 300 cities and provides over a million rides per day. Smartphone apps make hailing a ride-share quick and simple.

As a result taxi and limousine services, with their heavily-regulated business models, have seen enormous declines in some locales. According to a report from Certify, ride hailing services now account for over 80% of the business ground transportation market, based on business expense receipts.

If you are thinking of starting a ride service you may want to think about specialized areas such as transportation services for seniors or the handicapped (see The Best Business Ideas for Working for or with Seniors). Senior transportation franchises such as Driving Miss Daisy are available. There are also still plenty of opportunities for contract truck drivers.

Finding the Right Business Idea

Open for Business
Image (c) Fabio C. Manente / EyeEm / Getty Images

If you want to start a business and your business idea is on this list, don’t get too discouraged. There are so many great business ideas out there and with some research and thought, you’re sure to find the one that’s right for you.

Learning how to generate your own business ideas is a great place to start.

Browse these business idea articles ranging from 15 Inexpensive Businesses That Anyone Can Start through The Best Small Business Ideas for Businesses That Will Prosper in Tough Times.

There are no guarantees of success when starting a business, but you can dramatically increase your odds of success by preparation and due diligence.

Have a business idea? Do some preliminary market research. Is there a demand for your product or service in your area or is the market already saturated? To start a successful business you need the demand for your products and services to continue to be healthy to ensure your business is profitable for years to come.

Once you’ve chosen an idea, the best thing to do is write a business plan; it will help you determine if a particular opportunity is right for you.

See also:

12 Wacky Business Ideas (That All Make Money)

15 Inexpensive Business Ideas

Top 10 Tips for Starting a Business That Will Succeed