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Doomed to Failure: Business Ideas Unlikely to Succeed in 2021

Businesses to avoid in 2021

Recently we published a blog post that promised 10 Niche Business Concepts for 2021, and offered some business ideas likely to be successful this year. It got us thinking, though, how turbulent these times are for new small businesses. 

We figured that, as well as providing tips on the best business ideas to pursue in the coming year, it might also be helpful to offer advice on those businesses and industries to avoid in 2021. 

Whether Covid has gutted the industry, or simply shifted consumer behavior away from favoring a given business model, there are plenty of businesses that started 2020 strong but would be poison to try out now. 

So, here’s Zyro’s shortlist of the business ideas that are highly unlikely to bring you success and fulfillment. 

We’re not here to tell you what to do, but… maybe don’t try any of these.

Business ideas to avoid in 2021

1. Nightclubs

DJ setup in nightclub

If there’s one thing many people are really itching for during the pandemic, it’s a good dance. 

There’s no question that, as soon as it’s safe to do so, people will come back to nightclubs in their drove, looking to get loose, have a good time, and dance off that Covid funk. 

So how come nightclubs are introducing our list of businesses to avoid in 2021? 

Firstly, because, while people might feel like they want to let loose, the reality of entering a dark room crowded full of intoxicated strangers without masks will no longer carry the same appeal as it did at the start of 2020. 

We will have spent way over a year adjusting to a new, socially distanced reality, and that’s going to be hard to shake. 

The model of nightclubs as we understood it will be changed for a lot longer than you might expect, and with the ever-present threat of further restrictions, tighter regulations, higher competition, and future waves of Covid, this is just an unpredictable business to get into. 

2. Travel businesses

Empty plane

It’s not just the immediate issue of Covid restrictions and lack of interest in travel at the moment which you need to contend with. In so much of the world, travel and tourism infrastructure and networks have totally broken down. 

This means that in the post-Covid world we’re going to enter, it’s going to be harder than ever before to deliver quality holidays at reasonable prices. 

The companies that will blossom in the travel industry after Covid are, unfortunately, those larger brands that have the resources to weather the crisis, and the networks and reach to continue offering good deals. 

3. Restaurants

Empty Restaurant

Anyone even slightly familiar with gastronomy will know that, of all small businesses, restaurants and diners have among the highest failure rates at the best of times. 

Covid, of course, has seen a huge number of even very established restaurant owners hanging up their aprons due to restrictions and drops in trade. 

While it might be tempting to assume that this means there’ll be a large gap in the market as restrictions are lifted, we would still advise that this is an ailing industry you’re unlikely to succeed in. 

While there may be an initial spike in eating out as restrictions are lifted, the surge in popularity of food delivery services is unlikely to subside massively. 

Unless you have tons of experience in running restaurants, have a strong concept, great location, and a receptive market, it’s worth steering clear.  

4. Salons and spas

Empty Salon

One of the very first kinds of businesses that were ordered closed at the start of the current crisis were those which were deemed unessential or required close physical contact. 

This meant pretty much all beauty salons and spas. 

Despite the refrains of “I need a haircut” that have been heard throughout the pandemic, these are also likely to be among the last businesses that return to business as normal at the end of the current situation. 

While the long-term survival of this industry is all but assured, at least until the end of 2021, it’s likely to face tighter restrictions and higher uncertainty than other types of businesses mentioned in this list. 

5. Events businesses

Empty Function Room

This is another industry that has suffered greatly under Covid restrictions, and which will no doubt see a slow return to normal. 

Even once the restrictions have been lifted and people are back in the mood to hold events again there’ll be another issue: competition. 

Owing to the low bar to entry, events businesses tend to be among the easiest to start, and therefore the most competitive. 

It would be our recommendation that you try and seek out a business model that is a little more niche. 

6. Coffee shops 

Empty Coffee Shop

Similarly to restaurants, coffee shops are likely to see a slow recovery, stretching out across the next couple of years. 

Adding to the difficulties here, coffee shops tend to have even more narrow operating margins to restaurants, making them even more challenging to turn a profit from. 

All this said, unlike some of the other businesses on this list, however, the outlook for coffee shops (of a certain type) look good. 

Not only will there be a refreshed appetite for long brunches and takeaway coffees at the end of the pandemic, but the shift away from offices and towards remote work will mean that plenty more laptop-wielding remote workers will be on the hunt for a table and wifi connection. 

7. Pretty much any brick and mortar store

Closed storefront

The continuing pandemic will certainly keep consumers away from regular brick and mortar stores of all types in the short term, but the post-Covid landscape looks bleak for the high street too. 

Most forecasters agree that the relationship between consumers and stores will remain reversibly changed by the crisis. After more than a year of people getting used to the practice of shopping for almost everything online, there is simply going to be less appetite for stores as they used to exist. 

While it’s pretty certain that big grocery stores and some other niche services will gradually see their regular trade returning, opening up a high street storefront as a new small business is so risky as to be entirely untenable. 

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Duncan

Duncan is obsessed with making website building and eCommerce accessible to everyone. He explains the best tools and the latest digital marketing trends in ways that are clear and engaging. His focus is on supporting the sustainable growth of small to medium-sized enterprises. When not writing, he enjoys deep sea fishing and endurance cycling.

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