What's a good business to start in a slow economy?

LegalZoom.com Inc., the California online legal documents service company, suggested the following ventures:

Debt collection

Tough economic times are when bills start to pile up and go unpaid, LegalZoom said.

Maybe it's not an especially pleasant business, but it generally does well during economic downturns. It's a business that can be started at home as an independent contractor for a debt collection agency, too.

International business coach Brad Sugars, chairman and chief executive of ActionCOACH in Las Vegas, agreed that in wake of "extremely loose lending practices," a debt collection company could be a great business to be in during a sluggish economy.

The challenge is holding on to the clients when things get better. "If you come in too late, you may struggle," Sugars said.

Health-care sales

An aging population is going to purchase health-care products and services as their health declines whether or not the economy is sick, LegalZoom said.

Sugars agrees.

"If you need health care, you need health care. If you're going to go into business yourself, go into business with a stable product or service - something people need to buy," not just the latest gizmo.

Gordy Fox, founder and chief executive officer of Home Care Delivered, a health-products supplier in western Henrico County, said that is good advice.

"Any company in health care that has a distinguishable competitive advantage will perform well in this or any economy," he said.

Job search agency

When the economy tanks and people lose jobs, they often turn to employment agencies or job search firms. This may be a good choice if you are a people person with lots of industry contacts and a knack for matchmaking, LegalZoom said.

Sugars said "that's going to be a very high need over the next several years," even though employment is still pretty high right now.

Mediator

Simmering legal disputes often wind up in the hands of a mediator because they're less expensive than attorneys, LegalZoom said.

If you're skilled at negotiating, this may be a good business opportunity.

"There is a very big trend today of using mediators rather than going to court," Sugars said.

But most mediators are legal specialists. "It might be difficult to jump into the business," he said.

Security businesses

Crime doesn't stop in a recession, making security firms a necessity, LegalZoom said.

Not just companies that provide burly security guards, but those that perform workplace security and background checks.

"I wouldn't say it's a recession-style business," Sugars said. "One of the first things companies cut back on is excess security."

Computer repair

Whether an economy is good or bad, computers need fixing, LegalZoom said.

Consider starting a repair business if friends and acquaintances always call you when their computer goes kaput.

Sugars said computer repair is a good business when the economy is sluggish. "People aren't going to upgrade. They're going to repair."

Pawnbroker

A bad economy can mean good times for pawnbrokers as cash-strapped consumers come in with merchandise to plunk down as collateral on loans, LegalZoom said.

"You get a lot of people selling to you," Sugars said. "But you want buyers. Everyone wants to pawn their stuff and not buy much" in a slow economy.

Cosmetics sales

Sounds odd, LegalZoom said, but cosmetics are an inexpensive way for consumers to feel good when times are hard.

One option could be to hold home parties for beauty-aid products such as Arbonne or Mary Kay. That is a good, low-overhead business, Sugars said. "People buy because they're having fun. All you've got to do is sales. It's a great first business to get in."
Contact Iris Taylor at (804) 649-6349 or itaylor@timesdispatch.com.