Recession and Personal Services

A trend we've been following for years is the growth of personal service firms. 

These are firms that have created niche businesses by providing life support services to increasingly harried, time constrained and affluent consumers.

Examples include traditional personal services like gardening, house cleaning, fix-it services, nannies, cleaners, etc. 

It also includes career coaches, college counselors, dog walkers, personal shoppers and a wide range of firms that provide teaching and training services for kids and adults.

There has even been a butler boom over the last decade.

The NT Times article Outsourced Chores Come Back Home discusses the impact of the recession on personal services businesses.  Not surprisingly, they are struggling as consumers choose to do these tasks themselves to save money.

Personal businesses will be hit hard in this recession.  But the long term trend towards outsourcing tasks will survive this recession as consumers continue to outsource tasks they don't like or have time for.

Photo credit:  Wall Street Journal

Comments

[Curtis Gray]

What concerns me about Personal Services businesses is the fact that they are services businesses, as opposed to production businesses. In other words, they don't make anything.

So without production businesses to produce things (like cars, pencils, soap, and software) who are these personal services companies going to sell to?

This is why they are hit so hard during a recession. Since these services are expensive very few non-affluent people can afford them.

- Curtis
http://ShipItOnTheSide.com - Build a software startup as a side job.