Opinions expressed by BIZ Experiences contributors are their own.
The world seems to be spinning faster than ever. What's"in" this morning is "out" this afternoon. Insuch an accelerated environment, a business's ability to stayon top of trends is key. Knowing what's happening in yourindustry and what's likely to happen tomorrow, what consumerswant and what they need--these things make or break your business.To help you keep on top of the latest changes, we're offeringour selections for the top 11 businesses for 1997.
Some pretty large forces are at work in shaping these businessconcepts. The aging of the baby boomers (and their parents) isgiving rise to an interest in assisted living facilities for olderadults and physical therapy to keep people in peak condition.Ongoing corporate downsizing means specialized staffing servicesand professional employee organizations continue to thrive; newlyhot this year are business training companies that help peoplelearn new skills.
The Internet, of course, offers a world of opportunities, as docomputer training and consulting. And an increasing interest in"do-it-yourself" projects has spawned such successfulconcepts as brew-it-yourself custom breweries andpaint-your-own-pottery stores.
Our look at next year's hottest businesses will help youtarget your goals and keep your business on track for success.Check it out--then get to work putting this information to use.
Educational Toy Stores
Back in the days when the words "educational" and"toy store" never shared the same sentence, opening aretail toy outlet was a formula. A toy store was a toy store was atoy store. These days, however, toy stores that featurelearning-based playthings are all the rage.
Why is this market so hot right now? "Today's moreeducated parents are much more involved in their children'slives," says Katie Malone-Cordell, co-owner of Skokie,Illinois-based Brainstorms Inc. In addition, they often have lessfaith that the school system will supply all the education a childneeds.
Despite the presence of monolithic chains such as NoodleKidoodle and Zany Brainy, experts agree there's still room inthis industry for savvy BIZ Experiencess. It's not child'splay, however: "You need capital, competence and luck to makeit," says Howard Davidowitz, chairman of Davidowitz &Associates Inc. in New York City, a national retail consultingfirm.
So how can you ensure success? For one thing, choose a plumlocation, far from the upscale urban areas that large chains favor.But the key, says Sue Edelman, editor of Big Blue Box, apublication that reports on the children's market, is settingyourself apart from the pack: "Be sure you have somethingunique to offer."
Paint-Your-Own-Pottery Stores
Once again, BIZ Experiencess have broken the mold--this time bystarting a slew of paint-your-own-pottery stores. Different fromtraditional ceramic studios, these contemporary studios are locatedin bustling retail locations and boast a hip, coffeehouse-likeatmosphere. Here, the future Picassos of the world are given allthe necessary materials to create their own works of art onfunctional, prefabricated pottery pieces such as platters ormugs.
With an estimated 200 retail outlets and counting,paint-your-own-pottery stores are painting the town from coast tocoast. More than just shelves stuffed with pottery though, manystores also offer live music, cappuccino--even wine and cheese. Andsmart BIZ Experiencess bring in extra business by renting out theirstores for baby and wedding showers, bachelorette parties andholiday celebrations. "When we throw parties, many referralsare generated," says Leslie Tall, co-owner of Paint 'nPlates in Irvine, California, "and in this business,word-of-mouth is absolutely imperative."
You can't just throw yourself into this business, however.Before opening their store, Tall and co-owner Terri Laine Klingnerspent a year reading ceramics magazines, visiting warehouses andfrequenting studios to research prices and themes. Barbara Tobias,editor of Popular Ceramics magazine, warns that thoroughknowledge of safety regulations and the mechanics of ceramics aremusts: "It could really turn people off if they have problems,don't like how their pieces turn out, or if you can'tanswer their questions properly."
Web Site Design
In light of the Internet's promise to place a company'sproducts, advertising and marketing materials in front of millionsof customers, it seems every business on the planet either has aWeb site or wants one. That's why opportunities for firms thatcreate graphics and content for Web pages are simply outtasite.
"Businesses are continuing to learn how to use theWeb," says Don Heath, president of The Internet Society, whichseeks global cooperation and coordination for the Internet."That means good Web site design companies that can provideexcellent graphics and content are going to be important."
Market research firm O'Reilly & Associates estimates 40percent of large companies and 25 percent of medium-sized and smallbusinesses have either developed or plan to develop Web sites.Revenues are also coming from companies with poorly designed Websites that need to be revamped. And because Web site design firmsaren't limited by geography, the world market is in theirgrasp.
But while the Internet offers a huge audience, Web siteentrepreneurs must market intensely to get their attention, saysHeath. Another key? Learn more than just the technical aspect ofthe business. MacDonnell Ulsch, senior vice president ofO'Reilly & Associates' Online Research Division,advises, "A Web site developer also has to be a managementconsultant so he or she can develop a site that reflects themission, goals, culture and personality of the organization--notthe Web site developer."
Computer Training/Consulting
A vast work force in need of up-to-date computer skills,companies adopting new technologies to do more with feweremployees, and a seemingly endless supply of new and updatedsoftware programs--put it all together, and it's no wondercomputer training and consulting companies have a full plate.
Still, industry insiders say it's the Internet that'sspurring much of the growth in these two fields, with corporate andconsumer training on using the Internet leading this growth area.Opportunities for consultants to establish and manage Web sites andcorporate Intranets are also ripe, says Sharon Marsh Roberts, vicepresident of the Independent Computer Consultants Association.
According to Framingham, Massachusetts-based International DataCorp. (IDC), a technology research firm, revenues in the worldwidetechnology training and education market are expected to exceed $27billion in 2000. Likewise, IDC predicts the information technologyconsulting industry will reach $18.5 billion by 2000.
The challenge for computer consultants and trainers iscompetition. A strong commitment to marketing, adequatecapitalization, extensive networking and systems to handleirregular cash flow cycles are all key to a computerconsultant's survival, says Roberts.
Another important aspect is offering diverse training methods."It's important to keep up with the trends in technologyeducation to provide quicker, more efficient service," insistsDeborah J. Clifford, co-owner of Bloomfield, Connecticut-based HBMTechnology Group, an information and business technology solutionscompany, that offers classroom instruction, on-site training, amultimedia learning lab and CD-ROMs.
With no end in sight to the new and updated products that hitstore shelves each year, computer training and consultingbusinesses appear poised for rapid growth.
Specialized Staffing
Staffing services have been booming for nearly a decade. Inrecent years, providing employees who have specialized skills--suchas legal or accounting expertise--has emerged as an especially hotmarket segment, as companies find that hiring people withhigh-level skills on a temporary basis is much less expensive thankeeping them on staff.
The latest trends in this field? Supplying long-term andtemporary-to-permanent employees continues to be hot. Currently,says Bruce Steinberg of the National Association of Temporary andStaffing Services (NATSS), employees with technical and informationtechnology backgrounds are on the most-wanted list. Also hot is theprofessional segment, which includes workers with legal, accountingand management backgrounds.
Despite the demand for workers, there are significant challengesin this industry: Finding adequate capitalization and qualifiedworkers can be difficult, says Steinberg. You must also be cautiouswhen expanding; it's essential to keep a tight rein onreceivables while continuing to heavily promote your business.
"We do a tremendous amount of marketing," says BarryCohen, co-owner of New York City-based Response Staffing Services,a staffing company specializing in providing permanent andtemporary professional-level employees. "You're alwayslooking for new business, so you've got to keep your name outthere."
Despite the challenges, the industry outlook is good: Accordingto NATSS, the overall industry receipts jumped an impressive 10.8percent to reach $20.8 billion in the first half of this year ascompared with the $18.8 billion earned in the first six months of1995.
Physical Therapy
With Americans taking a more active approach to their health,physical therapy businesses are changing to address theirhealth-care needs. Once found exclusively in hospitals and usedsolely for stroke or accident rehabilitation, it's more commonnow to find physical therapists operating out of fitness centers,schools, large companies and free-standing locations and offering awide variety of services.
According to Peter A. Towne, president of the private- practicesector of the American Physical Therapy Association,private-practice therapists are thriving. "The BIZ Experiencesialaspect of physical therapy is bigger than it used to be," saysTowne. "Often, private practitioners enter joint ventures withhospitals to cover outpatient services."
Of course, you don't have to be a physical therapist toprofit from this market. If you've got the business skills butnot the medical know-how, consider hiring experienced therapists tohandle the hands-on work while you tackle marketing, management andthe rest.
Why the growing need for physical therapy? "The populationis living longer," says C. Shelby Durham, who opened RehabOptions Inc., a certified rehabilitation agency in Bala Cynwyd,Pennsylvania, in 1992. But physical therapy isn't just forolder people, Durham is quick to point out; people withdisabilities and sports injuries, among others, also benefit."There's a tremendous need for our types ofservices."
Assisted Living Facilities
Why are assisted living facilities so popular? Just ask PaulKlaassen, CEO of Fairfax, Virginia-based Sunrise Assisted Living, achain of more than three dozen residential elder-care facilities."Americans are dissatisfied with existing options," saysKlaassen. "[The typical] nursing home is expensive, offers alow quality of life and has a hospital environment not designed forlong-term stays."
Assisted living residences, on the other hand, offer residents ahomelike environment, much like apartment living, that provides thehelp they need, whether with taking medication, bathing, dressing,eating or transportation. This relative independence is vital totoday's aging population, says Karen Wayne, executive directorof the Assisted Living Federation of America (ALFA).
Since emerging in the late '80s, the assisted livingindustry has experienced astonishing growth. In six short years,membership in ALFA has soared from zero to 2,600 members."Consumers are demanding this type of long-term care,"says Wayne. And with America getting even grayer as baby boomershead toward their golden years, Klaassen notes, "You have allthe ingredients for explosive growth."
Professional Employer Organizations
A rash of small businesses are shrugging off the endlesspaperwork, unclear regulations and red tape involved in handlingpersonnel functions and are leaving it to the pros--professionalemployer organizations (PEOs), that is. According to Bankers TrustResearch, revenues and earnings for PEOs (formerly known asemployee leasing companies) are growing at about 30 percentannually.
How do PEOs work? Unlike staffing services, PEOs form aco-employment relationship with a small business so both parties"own" the company's personnel. Then, PEOs handle allthe personnel duties, including payroll, hiring and salary reviews.And because PEOs pool employees from multiple companies, they canoffer lower rates on employee benefits such as health care andretirement packages.
One major change in the past year is a move toward PEOstargeting larger companies. Until now, most PEOs limited themselvesto clients with fewer than 100 employees, says Milan P. Yager,executive vice president of the National Association ofProfessional Employer Organizations. But businesses with 200 ormore employees are discovering PEOs can serve their personnel needsas well.
Because of the potential for lawsuits and the very small marginsPEOs operate on, Yager cautions that successful BIZ Experiencess mustbe knowledgeable in benefits and payroll administration as well astaxes and employment law to understand all the rules andregulations.
Keeping clients satisfied is also a must. "Most of ourbusiness comes from referrals," says Fran Morrissey, presidentof Staff Management Inc. in Rockford, Illinois, "so providingquality service is what's really helped us grow through theyears."
Healthy Mexican Restaurants
Remember all that hysteria about the high fat content andinherent evil of Mexican food? Well, now there's analternative: So-called "healthy" Mexican restaurants(often dubbed "fresh Mex") are opening at breakneck speedaround the country--indeed, around the world. Apparently, dinerswant to have their guacamole and stay healthy, too.
La Salsa. Chico's Tacos. ZuZu Handmade Mexican Food. LasFajitas. Cool Peppers Mexican Grill. The list of "light"Mexican fast-food restaurants is growing by leaps and bounds."A restaurant concept is only as good as the pleasure itbrings the customers," says Edward Anderson, president ofChico's Tacos, a chain of fresh-Mex restaurants. "The keyto our success is taste and presentation."
The numbers justify--and fuel--Anderson's enthusiasm.According to the latest Census Bureau figures, sales of Mexicanfood are higher than any other type of ethnic cuisine, ringing upannual sales of $11 billion.
Some experts believe the healthification of Mexican cuisine issimply a reflection of trends in the restaurant industry--andchanges in people's eating habits in general. Americans seem tobe craving healthier fare. And if their hankering for an enchiladahappens to coincide with a craving for something light, well,that's what fresh Mex is all about.
Custom Brewery
Microbrewed beer is a hot commodity these days--that's notnews. What is news is that now there's a way to get inon this market without the expense of opening a full-scalemicrobrewery.
BIZ Experiencess and beer connoisseurs alike are raising theirglasses to custom breweries, which allow customers to brew theirown beer on the premises. What's the advantage? For customers,it's the fun of brewing it themselves, right down to creatingproduct names and designing labels. For BIZ Experiencess, it's thebenefit of opening in a smaller space with less expensive equipmentthan is needed for a traditional microbrewery.
The initial capital outlay is smaller because there is no diningfacility--you offer custom brewing and tasting only. That's onereason the number of custom breweries nationwide has grown fromjust eight in 1995 to more than 40 today.
"People are drinking less but drinking better," saysJeff Altvater, who opened Custom Brew Haus in St. Louis in 1994after noticing a trend toward more personalized concoctions."People really enjoy learning about beer and developing theirown taste, trying to find a beer that is their style."
And for existing microbreweries, adding custom brewing to theiroperations is as natural a match as beer and pretzels--and a greatway to pour on additional profits.
Job Training/Retraining
In a world where the skills you have determine how successfulyou are, it stands to reason that the more skills you have, thebetter your chances for success. That's why today'semployees are clamoring for additional training to make themselvesmore well-rounded, increase their promotability or provide themwith a backup plan in case they're laid off. No wonderbusinesses that train the general public and retrain thedownsized-and-out are multiplying faster than you can say"You're fired."
"People are having to make changes more quickly than everbefore," says Laura Berman Fortgang, owner of Verona, NewJersey-based InterCoach Business Development & Training. Theydon't want to wait until the ax has fallen before takingaction, so they are reinventing themselves.
That trend has created a market of at least 1,500 individual jobcoaches nationwide and untold numbers of training businesses,according to Thomas J. Leonard, founder of Brandon, Florida-basedCoach University, a training and development company.
Today's courses target everyone from newly divorced womenseeking to re-enter the job market to people who want to learn wordprocessing or executives hoping to become more promotion-worthy.And depending on the type of training you specialize in, you may beable to skip establishing an office altogether; some of yourclients may prefer you to train on-site.
While laid-off or downsized employees (or those fearing such)are the hottest market right now, they aren't the only game intown. According to Leonard, tens of millions of self-employed andhomebased individuals are also ripe for coaching or training."People want to get ahead," he says. "They don'twant to lose out."
Contact Sources
American Physical Therapy Association, (800) 999-2782;
Assisted Living Federation of America, 10300 Eaton Pl., #400,Fairfax, VA 22030, (703) 691-8100;
Bankers Trust Research, 130 Liberty St., 10th Fl., New York, NY10006, (212) 250-2500;
Big Blue Box, 9 Galen St., Watertown, MA 02172, (617)923-2583;
Brainstorms Inc., 8221 N. Kimball Ave., Skokie, IL 60076, (800)621-7500;
Chico's Tacos, P.O. Box 890144, Temecula, CA 92589-0144,(800) 77-CHICO;
Coach University, 1971 W. Lumsden Rd., #331, Brandon, FL 33511,(800) 48-COACH;
Custom Brew Haus, 6701 Clayton, St. Louis, MO 63117, (888)334-BREW;
HBM Technology Group, (860) 243-1000, dclifford@hbm.com;
Independent Computer Consultants Association, 11131 S. TowneSq., Ste. F, St. Louis, MO 63123, (800) 774-4222;
InterCoach Business Development & Training, 45 Wayland Dr.,Verona, NJ 07044, (201) 857-5068;
International Data Corp., 5 Speen St., Framingham, MA 01701,(508) 872-8200;
International Trade Administration, (800) USA-TRADE;
The Internet Society, 12020 Sunrise Valley Dr., #210, Reston, VA20191-3429, http://www.isoc.org;
National Association of Professional Employer Organizations,(703) 836-0466, http://www.napeo.org/peo/;
National Association of Temporary and Staffing Services, (703)549-6287, http://www.natss.com/staffing/;
O'Reilly & Associates, 101 Morris St., Sebastopol, CA95472, (800) 998-9938, ext. 332;
Paint 'n Plates, 4213 Campus Dr., #166D, Irvine, CA 92612,(714) 509-6115;
Rehab Options Inc., 111 Presidential Blvd., #101, Bala Cynwyd,PA 19004, (800) 430-7342;
Response Staffing Services, 271 Madison Ave., New York, NY10016, (212) 983-8870;
Staff Management Inc., 5919 Spring Creek Rd., Rockford, IL61114, (815) 282-3900;
Sunrise Assisted Living, 9401 Lee Hwy., #300, Fairfax, VA 22031,(888) 4-DESTINY;
Take Good Care, 160 Rte. 22, Springfield, NJ 07081, (201)912-0200.
