To read the most up to date version of this article, view the Most Profitable Businesses in the US 2024 here.
When it comes to starting or buying a business, choosing one that belongs to a profitable industry is key. While there are other things to consider before investing in a business - like skillset, passion, and funding - determining if a business will make a profit should be one of the first things to factor in.
To help you make the most informed decision, we've compiled our top picks of the most profitable businesses in the US with a factual analysis of why they made our list.
Most profitable small businesses in the US
Whether you plan to start your own venture or buy an existing business, here are the most profitable small business ideas you can pursue.
Cleaning services
A cleaning business leverages the simple idea that you're willing to handle tasks that people shy away from or can't find the time to do. So, whether you choose to service residential or commercial properties, there's high demand for what you offer. With an expected CAGR of 6% by 2026, the cleaning industry is on an upward trend.
However, there are over 800,000 cleaning service businesses in the US which depict a saturated marketplace. This means you'll never be without competition. Whether you plan to start your own cleaning business or invest in an existing one, you’ll need to work hard on differentiating yourself and growing a customer base.
Tip: business opportunities in the commercial cleaning sector double that of residential ones. That's something worth considering before settling for a niche.
Accounting and bookkeeping
If you're a certified public accountant or simply good with numbers with great attention to detail, then investing in a bookkeeping business might be perfect for you. Most small business owners don't have the expertise or bandwidth to manage their accounts themselves, which is why the demand for accounting services is consistent.
With a net profit margin of 18.4% and an average salary of $61,859 per annum, the accounting and bookkeeping services venture is one of the most profitable businesses to start.
Food trucks and food stands
Investing in a food truck business is a terrific idea for those passionate about culinary. With an overhead cost lower than that of running a restaurant and the added advantage of mobility, the food truck business offers entrepreneurs with less funding the opportunity to tap into the food service industry.
With a revenue of over $1 billion in 2022 and a CAGR of 6.4%, the food truck industry is expected to reach a market size of around $2.04 billion by 2030. The food truck business is very competitive, with competition coming not only from other food truck businesses but from brick-and-mortar restaurants and grocery stores as well.
However, despite the saturation, food truck businesses with ingenuity and creativity thrive. An average annual income of $250,000- $500,000 makes it one of the most profitable food businesses to invest in.
If this idea isn’t convincing, but you still want to start a business related to food, you could start a food business from home.
Pet sitting and walking business
About 70% of families in the US have pets, which translates to a whole lot of pets that need to be taken care of when their parents are away for extended periods. So, if you're passionate about pets and want to turn your interest into a business opportunity, investing in a pet service business or starting a dog-walking business might be the right move.
With an average rate of $15/hr, pet sitters make a national average of $31,814 annually.
Pet sitting belongs to the increasingly profitable pet care industry. With a CAGR of 5.06%, the industry is expected to grow from $76.8 billion in 2023 to $98.3 billion by 2028.
As a pet sitter, your competition is other pet-sitting and dog-walking companies, non-professional pet sitters, alternative pet care facilities, and tech companies like Uber for dogs.
Dropshipping
Dropshipping is a subset of e-commerce that includes businesses that sell goods they do not actually have in store. How it works is that the products are delivered directly to the customer by the vendor. This way, you save on shipping fees and inventory storage costs, making it one of the most profitable e-commerce businesses.
Dropshipping is a lucrative business; market analysis shows that the dropshipping market in the US is expected to move from $13.92 billion in 2020 to $24.2 billion in 2026 at a CAGR of 9.65%.
However, dropshipping is very competitive. The Internet is a vast space, but it is also interconnected, which means a lot of people could have access to the product you're selling as well as your target audience. So, if you want to start an e-commerce related business, ensure you have a solid value proposition to convince customers your business offers the best solution.
Auto repair business
There are many reasons why auto repair businesses are a profitable route into business ownership. The average age of vehicles in the US has risen to 12.1 years, which means rather than replacing, people are choosing to repair and hold on to their cars longer. So, if you're a skilled mechanic, investing in an auto repair shop can be a rewarding business venture. Except for major repairs, most fixes can be done on-site with a simple set of tools. Buying an auto repair business is another route into the industry, which will include existing equipment, clientele and property.
The US automotive service market, increasing at a CAGR of 5.98%, is expected to reach a market size of 237.33 million by 2028. The market concentration is medium, which means although competitive, there is room for new players to come in and grow and run a successful auto repair shop. The average annual earnings for a mobile mechanic in the US is $74,643.
Tutoring services
Modern education is evolving toward remote lessons, and while it has a lot of benefits, it has also produced a unique set of challenges for students of all ages. Starting a tutoring service puts you in a position where you can help students struggling with basic concepts and gain more understanding in specific areas further.
So, if you're confident in your communication skills and proficiency in a particular subject or field, tutoring might be a great opportunity to turn your knowledge into profit. You can opt for physical or virtual lessons depending on your target audience. Private tutors in the U.S. earn an average of $25-$80/hr, and online tutors make $25-$50/hr.
Childcare services
Whether it's a daycare, nanny business or after-school teaching, parents will gladly loosen their purses to pay for your time if you can guarantee an educational, safe and reliable service. Since you'll be dealing with kids, most childcare services require certification and background checks. This will differ from state to state. Beyond that, it is a great business opportunity that promises steady income.
Although the average childcare worker's salary in the US is $37,875, there's a possibility to earn far more than this, particularly through daycare businesses. The childcare services industry is forecasted to have a market size of $83.6 billion by 2030, growing at a CAGR of 4.18%.
Carwash and detailing
About 66% of Americans wash their cars at least once or twice a month, an average of 13 washes yearly. Also, more than 72% of drivers in the US use professional car wash services frequently. This shows that as long as people have cars, the carwash and auto detailing business will always be in demand.
The US carwash industry is very profitable, with the mobile carwash and auto detailing market projected to reach $251.583 billion by 2033, growing at a CAGR of 9%. Also, a one-person detailing business can rake in about $90,000 annually, making it one of the most profitable service businesses.
If you're interested in a carwash with a physical location, you can explore profitable car wash businesses for sale on our site.
IT support
IT support is another business that profits significantly from an increasing reliance on technology. Your target customers would be people who have internet or software issues, need to run security programs or require network updates - to mention a few. So, if you're tech-savvy with loads of patience to spare, then running an IT support business might be a great way to begin your entrepreneurial journey.
On average, IT support specialists make $32/hr, rounding up to $67,030/year. The IT service industry in the United States is on an upward trend, with a growth rate of 6.7% and an expected market volume of $628.80 billion by 2028.
Helpful FAQs
What are the most profitable businesses in the US?
Profitable small businesses you can invest in include:
- Cleaning services
- Accounting and bookkeeping
- Food trucks and food stands
- Pet sitting and walking
- Dropshopping
- Auto repair business
- Tutoring services
- Carwash and auto detailing
- Childcare services
- IT support
What kind of online business is more profitable?
Some of the most profitable online businesses include:
- Dropshipping
- Online tutoring
- Digital marketing agency
- Affiliate marketing
- Graphics design
- Freelance writing
What small business has the highest profit margin?
Some high-profit margin businesses include:
- IT support
- E-commerce
- Accounting and bookkeeping
What is the easiest business to succeed in?
Some of the easiest businesses to succeed in with low overhead costs include:
- E-commerce businesses
- Pet sitting and dog walking
- Cleaning services
- Tutoring
Ready to start your journey into business ownership?
Choosing which business idea best aligns with your interests and skill set is just the beginning of your path to entrepreneurship. After settling for an idea, you must research the industry your business belongs to. Do a thorough market analysis to find out the competitiveness of the sector, pricing of competitors, an effective marketing strategy, gaps in the market and ways to exploit them.
Next, you'd have to figure out the best way to secure funding. Depending on your starting capital, you can explore funding options such as SBA loans, crowdfunding, grants, angel investors and family and friends. You can read our guide on accessing financing for more resources on funding the purchase of a business.
Starting a business from scratch isn't the only path to entrepreneurship; you can always buy a business and continue to grow it. There are thousands of profitable businesses you can buy on our site.
And if you're set on starting your own business, you can read our guides on what it takes to start different businesses.
@Be_theBoss