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The 8 Most Promising Types of Businesses for Start-Ups

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Not surprisingly, the hottest industries of 2013 are all somehow connected to tech.

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Online Shoe Sales

This industry has grown 16.2% over five years to $8.9 billion in 2013. Each year, more than 100 million Americans buy goods from the online retail marketplace, and clothing, accessories and shoes are the second largest category of items after books. IBISWorld estimates industry revenue will increase at an average 10.2% over five years.

Amazon (NASDAQ:AMZN) and Foot Locker (NYSE:FL) control less than 16% of this market. "Online shoe retailers were the most surprising on the list. The industry has a lower level of concentration" than might have been thought, says Boyland of IBISWorld. Meanwhile, online-only retailers like Zappos, warns Goettler, will need to ensure consumers can return their products inexpensively and conveniently. Neal worries that this industry has already peaked.

Digital Forensic Services

If your IT security fails, a digital forensics service comes in to investigate. These services help solve crimes committed with or on computers, such as phishing, bank fraud, and money laundering. In the last five years, IBISWorld says revenue for this industry increased at an annualized rate of 11.9% to $976.2 million. As consumers spend more time online, the amount of electronically stored information (ESI) will rise exponentially.

There are obstacles. Capital intensity and the rate of technological change are high, so prospective firms have to secure substantial backing to enter successfully. Industry participants will be challenged by the expansion of cloud computing, which allows information to be manipulated, stored and processed from multiple computers. Still, revenue is likely to continue to climb at the rate of 9.1% over the next five years.

Translation Services

The growth of the global market has benefited this industry. Industry revenue has increased at a rate of 2.4% in the past five years to $3.2 billion in 2013. The Internet has been instrumental in increasing demand for translators as businesses expand into new countries and require services to adapt websites and marketing materials to the new region. Industry revenue may increase 3.4% in 2013, though IBISWorld points to some challenges. Translation services remain relatively labor intensive, and some competition exists through software programs and free internet websites (though most fail to provide cultural context).

TV & Home Theater Instillation Services

IBISWorld says this industry is highly fragmented and has a very low level of capital intensity, affording firms with transportation and proper tools good opportunity. About 98% of today's US households have at least one TV, 84% have a DVD player or recorder, and 25% have a home theater, according to the Consumer Electronics Association. Revenue is growing an annualized 4.1% to $12.2 billion over the five years to 2013.

But cable subscriptions are falling – one report says paid subscriptions will be down 6% by 2017. To succeed, start-ups must keep up with the rapid pace of technology. "One concern with theater installation services is the difficulty of identifying and reaching consumers without paying significant commissions or referral fees to consumer electronics retailers," says Goettler.

Editor's Note: This article by Sheryl Nance-Nash originally appeared on The Fiscal Times.

For more from The Fiscal Times:

The 10 Hottest Spots to Start a Small Business


The 10 Best and Worst States for Small Business

7 Reasons Why It's Never Been Easier to Start a Business


Follow The Fiscal Times on Twitter @TheFiscalTimes.
No positions in stocks mentioned.
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