The 7 Worst Businesses to Buy Or Start
by
Get the full episode insights!
Enter your email below to get notified about more insights from:
BigDeal
This episode is titled:
The 7 Worst Businesses to Buy Or Start
Notable Quotes
"Some businesses are deadly to your money, restaurants being one of them."
"The truth is there is no such thing as the right or wrong business. There is only the right or wrong business for you."
Get episode summaries just like this for all your favourite podcasts in your inbox every day!
Get More InsightsEpisode Summary
In this episode of the Big Deal Podcast, host Cody Sanchez outlines seven types of businesses that potential buyers should avoid. The discussion begins with the introduction of the Contrarian Community, a platform designed to assist individuals interested in business acquisitions.
Cody shares a cautionary tale about a community member, Mary, who made poor business decisions by purchasing a failing restaurant franchise and entering a 50-50 partnership with an inexperienced operator. This story exemplifies the risks associated with starting businesses that he categorizes as "deadly."
The episode outlines seven specific types of businesses to avoid: first, restaurants, which have high failure rates; second, hotels, which are seen more as real estate with operational complexities; third, retail storefronts that often result in financial losses; fourth, consulting firms due to key man risk; fifth, personal brands that are difficult to sell post-owner; sixth, Amazon FBA dropshipping that suffers from platform risks; and seventh, dry cleaners, which carry environmental liabilities.
Cody emphasizes the need for careful risk assessment and alignment with personal strengths and networking resources when considering business acquisition. Instead of just jumping into any business based on dreams or trends, he advocates for a strategic approach, ensuring that the business chosen aligns with one's skills, passions, and resources, reinforcing that the right business is subjective to each individual’s circumstances.
Cody shares a cautionary tale about a community member, Mary, who made poor business decisions by purchasing a failing restaurant franchise and entering a 50-50 partnership with an inexperienced operator. This story exemplifies the risks associated with starting businesses that he categorizes as "deadly."
The episode outlines seven specific types of businesses to avoid: first, restaurants, which have high failure rates; second, hotels, which are seen more as real estate with operational complexities; third, retail storefronts that often result in financial losses; fourth, consulting firms due to key man risk; fifth, personal brands that are difficult to sell post-owner; sixth, Amazon FBA dropshipping that suffers from platform risks; and seventh, dry cleaners, which carry environmental liabilities.
Cody emphasizes the need for careful risk assessment and alignment with personal strengths and networking resources when considering business acquisition. Instead of just jumping into any business based on dreams or trends, he advocates for a strategic approach, ensuring that the business chosen aligns with one's skills, passions, and resources, reinforcing that the right business is subjective to each individual’s circumstances.
Key Takeaways
- Avoid businesses with high failure rates, such as restaurants and hotels.
- Assess your personal strengths, passions, and network before starting a business.
- Understand the risks associated with platform-dependent businesses like dropshipping.