Follow the Economy

• At the time of this writing, most people's budgets are directly affected by the recession: Either they've already taken a hit to their bottom line and have tightened their belts, or they're worried about their future incomes and have cut back on their spending pre-emptively. Unless your target market is the unworried rich, this is a bad time to start a business selling high-priced luxuries.
  
  New businesses should therefore focus on high-value products at reasonable end cost for their customers. This does not mean cheaply priced products; most small businesses don't have the economy of scale to be able to compete effectively on commodity items. Instead, focus on high-quality items at competitive pricing, which still have a decent profit margin. You can charge your customers accordingly with the quality of your goods and services, so long as they feel like they are getting sufficient value for their dollar.
  
  

Follow the Trends

• Every business starts in a larger economic and social environment, during which some markets are clearly "hot" and others are considered past their prime: right now, environmentally sustainable energy is considered a hot market, but few people are starting new businesses in real estate or mortgage services.
  
  Of course, the problem with hot markets is that everyone knows about them already. The best trends are the ones which you can identify, but which have escaped the notice of the larger market. These markets will offer you less competition during your start-up and early expansion phases, which will give you a leg up before everyone else notices the opportunities in your market.
  
  

It Doesn't Matter: Follow Your Muse

• Arguably, you shouldn't try to time the beginning of your business at all. Economic trends tend to last only one or two years, and "hot" markets can be similarly short-lived. A successful business, on the other hand, can take five years or longer to reach full profitability. If the success of your business is predicated on an unchanging economy, you may find yourself unable to sustain your business model when your initial assumptions no longer match your market.
  
  The best business to start now is the business that you can successfully launch--and in which you want to invest your time, effort and capital--independent of transient economic and social impacts. Most successful businesses are founded with the long haul in mind. It's the rare entrepreneur who can start a business, accomplish his financial goals and get out in a short time frame.
  
  The question to ask, instead, is not whether this time is good for your business, but whether your business is good for this time. A solid business idea will last, but may be delayed for a better environment. But a business which must be started immediately--and which you expect is likely to fail under different circumstances--is probably too likely to fail, period.