If you’re thinking about starting a business and want to
figure out which products or services have higher profit margins (or low
initial investment), one thing to keep in mind is that it's generally about
finding something where the cost of production or delivery is significantly
lower than the price customers are willing to pay. This often comes down to low
overhead, intellectual property, or specialized skills. People are willing to
spend money, indeed they are going to spend it somewhere.
Let’s dig in to some categories for these high profit/low
investment businesses and some examples:
1. Digital Products and Services: There are actually
a lot of niches in the digital products category. These often have very
high-profit margins because, once created, they can be replicated and
distributed at virtually no additional cost. Following are some examples of Digital
Products and Services.
Online Courses: If you have some knowledge
that you can impart to other people (how to take good pictures, how to read
Tarot cards, how to make a great speech, etc.) you can create a course and
upload it to a provider like Udemy.com. You may need to interact briefly with
students on an ongoing basis, but once you do the initial heavy lift of creating
the course video, documents, quizzes and tests, it’s out there available for
sale endlessly, almost on autopilot.
Print-on-Demand
Books, and Ebooks: Again, if you have some knowledge that you can impart to
other people you can create a nonfiction book to tell people about that
subject. And if you’re a good storyteller or have a story churning around in
your soul, tell the story and sell it in ebook or print book format. You create
the content once, and sell it endlessly. Success here depends on the book cover
(get a professional one!), getting reviews, and getting word out there (i.e.,
marketing in every place you can think to market it.).
Print-on-Demand
Art, T-shirts, Hats, Mugs, Shopping Bags, etc. If you’re an artist or
photographer you can buy a special printer to print your artwork or photos on
canvas or paper and resell your prints over and over. If you’re good at graphic
design you can buy printing devices for printing on t-shirts, hats, mugs, and
other items. You can sell all this stuff on Etsy or E-bay or your own website.
And if you don’t want to buy the printers you can have one of many
print-on-demand websites print your stuff as the buyer purchases it and they do
all the work. The profit margin from print-on-demand website sales is very slim
however.
Software & Apps: If you have
programming knowledge and you work for a company, why not create your own
software, or better yet an app that can be sold on Google Play and in the Apple
store, or in the Microsoft Store. See what apps are popular and create a new
one with improvements. Or create a completely new app filling some niche no one
has thought of yet. If you don’t know how to code, there are websites where you
can create apps for Android or Apple. You can also hire someone to do it for
you pretty cheaply on Fiverr.com.
Stock Photos/Music/Video:
If you know how to take a decent picture and have a good quality camera, taking
photos and selling them to a stock photo website like Shutterstock can
be a good idea. You need to upload a large quantity of excellent photos to be
successful and you should pay attention to what people are looking for. Additionally,
you should always keep adding new pictures. But the ones you upload will
be available for sale over and over. Royalties are small, so that’s why you
need a huge library.
The same thoughts go for stock video, which is very
much in demand. Short videos in profile (or vertical) format (as if shot with a
smartphone vertically) are in demand for YouTube shorts, TicTock videos,
Instagram Reels, etc.) Also videos in 4:3 and 16:9 landscape views are in
demand. If you want to focus on creating stock videos you will find a very
successful niche opportunity. Watch a YouTube video that uses stock video
footage and you will see what kind of stock video is required by YouTube
creators and how much of it a single video can use. Again once your videos are
on the stock website, they can be sold over and over.
If you are a musician, one way to get name recognition or
some income is to create songs, instrumental music, soundscapes, or even sound
effects to sell on stock music websites. Stock music is pre-recorded
music available "off-the-shelf" from a large music library. Unlike
custom compositions, it's not created for a specific film or TV show. Once
created, these can be licensed repeatedly.
Digital
Marketing Services: The following digital marketing services often require
more time and skill than physical goods.
SEO, which stands for Search Engine Optimization, is
the practice of improving a website's visibility and ranking in search engine
results pages (SERPs) like Google, Bing, and others. The primary goal of SEO is
to drive organic (unpaid) traffic to a website. SEO is an ongoing process that
requires continuous effort, monitoring, and adaptation as search engine
algorithms evolve. If you know how to do this there are blogs and website
owners and developers who will pay you to help them rank higher in search results. (An SEO book)
Another digital marketing service is social media management. Some person or business may be too busy with their core
function to take care of their Instagram, Facebook, or Twitter/X accounts. This
might involve writing content for each social media account, interacting with
followers, or just posting what the company or individual gives you to post.
2. Consulting & Coaching:
Business
Consulting: If you have experience running a business, providing your expertise
to small businesses or new startups could be very profitable with little
startup cost for you. Businesses may need your help with writing business
plans, getting small business loans, business strategy, marketing, or operations.
You know what you know and what you can offer. This could be a very helpful
niche for some customers.
Personal
Training & Fitness Instruction: If you are certified as a personal
trainer or have experience with fitness instruction, you can leverage your expertise
to help individuals achieve their health goals. You may meet them at the gym,
at their home, or in your rented space. You could also create YouTube fitness
content.
Life Coaching: Guiding individuals in
personal development. While there are no federal or state-mandated licensing
requirements to be a life coach, in most places certain qualifications and
skills are highly recommended for success and credibility. While
anyone can technically call themselves a "life coach," the most
effective and reputable life coaches possess a strong set of interpersonal
skills, undergo robust training and certification, may have applicable college
degrees, and are committed to continuous learning to genuinely empower their
clients.
Tutoring:
Providing academic assistance to students can be a way to earn income with
little to no investment in resources. Ideally you will be a current or former
teacher, have a college degree in your subject area, or be a self-taught
expert.
Music Lessons: Similarly,
music lessons have a low startup cost, and can be a high profit margin
business. If you are good at playing a musical instrument, or singing, you can
turn your expertise into dollars.
3. Specialized Services with Low Overhead:
Cleaning
Services: Residential or commercial cleaning, often with low startup costs
and a focus on labor. Starting a business removing dog poop from people's yards is a burgeoning business opportunity.
Bookkeeping
& Accounting: Essential services for businesses with generally low
overhead.
Event Planning:
Clients often pay for venues and supplies, reducing the planner's direct costs.
Wedding planning is a much sought-after service.
Real Estate
Agent: Once you have your real estate license, commissions for selling real
estate can be substantial, with relatively low ongoing overhead beyond
licensing, gas for driving around to all the various properties, and marketing
(all of which is deductible).
Notary
Services: Being a Notary Public involves minimal ongoing expenses once
certified. Being a Notary Public, particularly a mobile Notary and/or Notary
Signing Agent, offers a flexible and potentially lucrative side hustle income. A
Notary Signing Agent assists as a Notary Public when contracts are being signed
and are often retained by lawyers’ offices or real estate offices. The
profession requires dedication to learning the laws, marketing your services,
and maintaining a high level of professionalism.
Photography
Services: Photographers for hire can have good profit margins, especially
for specialized niches like weddings or commercial photography. You need to
have good equipment, so the cost of initial investment could be a lot compared
to some of these other opportunities we’ve discussed, but still less than other
business startups.
4. Niche Products with High Perceived Value:
Jewelry: Jewelry can have very high markups, particularly for unique or luxury items, so if you
can find a good source of lower priced but quality Jewelry, you could do well
selling it.
Specialty
Products: Phone accessories, kitchen gadgets, watches, collectibles – items
that can be mass-produced cheaply but sold at a premium due to demand or
novelty. I would include Pokemon cards, baseball cards, collector items based
on movies, or Science Fiction series.
Candles: Some
people have success selling candles. Raw materials are inexpensive, allowing
for significant profit margins.
Pet Care
Supplies & Accessories: Pet owners are often willing to spend
generously on their companions. You could make pet beds, cat scratching posts,
pet food dishes, dog houses, bird houses, etc.
Skincare &
Cosmetics: Products in this industry often have high markups due to
branding, perceived efficacy, and consumer demand for beauty. Hence the success
of Amway, Mary Kay, and others.
It's important to remember that "high profit
margin" doesn't always equate to "easy money." Competition,
marketing, customer acquisition, and operational efficiency are all crucial
factors in realizing those margins. But if you’re thinking about working for
yourself there are many ways to do so and you can often create a niche that
taps into one of your interests or hobbies. People are willing to spend money,
in fact they must spend money, and they can just as easily spend that
money with you or they can spend it on some huge corporation. If you want the
potential to earn bigger money than you can as an employee for someone else,
consider one of these high profit margin or low initial investment business
ideas.
Good luck!
