Business Insights

10 of the worst business ideas to steer clear from in 2024

October 10, 2023

Worst bussiness ideas in 2022 everyone should stay away from

It doesn’t take much for what seems like a good idea to turn into a bad business. Turning a blind eye to current and predicted market trends can cost you a failed business and bankruptcy. To prevent that from happening in and safe you a lot of headaches, we’re taking a look at the worst business ideas.

It’s not that they’re really bad business ideas per se (some of them are though). It’s more about how the socio-economic situation is ever-changing and evolving, making it hard to move on with their realisation.

10 bad business ideas to stay away from

Now that we got that out of the way, let’s take a look at the worst business ideas to avoid in 2024.

Non-proprietary SaaS

SaaS is one of the worst business ideas because it’s already over-saturated with such a low barrier of entry that anyone can build and deploy sub-par technology. With inflation tightening up everyone’s purse strings, with exceptions, of course, I believe that only new, unique, and proprietary technology will stand a chance.

Kirk Morales, Co-Founder of Persosa

eStores for other brands

I’d say the worst possible business you could start is an eCommerce business selling other brands’ products.

Firstly, with eCommerce set to grow 129% this year according to Forbes, price competition for commoditized products will get tougher driving down margins to virtually nothing.

Secondly, more and more brands are moving towards D2C selling and bypassing retailers completely. Nike this year announced that they would not only boycott Amazon but would stop supplying retailers within 2 years, a trend likely to be followed by other leading D2C brands.

Finally, you won’t be able to compete with the big players with deep pockets that can afford to lose money on acquiring customers on the first sale and making it back on subsequent purchases meaning you won’t be able to compete on price.

Wesley Parker, Co-founder at Homesage

Pyramid Schemes

The worst business idea for 2024 (and the one I’d most strongly advise against) is a pyramid scheme business. Pyramid schemes are doomed to fail because their success depends on recruiting more people and investors over time.

There are only a limited number of people in a certain community so eventually, they collapse. Plus, the only people who make a decent income are those at the top of the pyramid, leaving those at the bottom with scraps.

The worst part, they’re often related to investment fraud and have already been banned in several countries.

Letitia James, The New York State Attorney General

Perishable food mail subscription

A perishable food business is a bad business idea on its own. Pair it with a mail subscription and it could end up in a disaster for many reasons. Managing perishable inventory is extremely difficult because timing is crucial for products that expire fast. Too many things that depend on time can cost the business – delays, miscalculations, miscommunications – not to mention product spoilage and damage. Also, these businesses face higher costs for storage and transportation.

Abby Jenkins, Product Marketing Manager at Oracle NetSuite

ATM routes

The problem with an ATM routes business is that the math doesn’t add up. On average, one ATM gets about 5 transactions per day, and the average withdrawal is around $80-$100. The worst part? You only get 1%-3% of that, which averages around $3-$15 per day. Not to mention the large initial investment, operating costs, cash pickup and restocking, and the long payback period (at least 4 years). So unless you have hundreds of ATMs in your route, it’s not worth it.

Codie Sanchez, Founder of Contrarian Thinking and Private Equity Investor

Retail stores

The majority of new retail stores start off well but fall off along the way. The failure rate of new retail stores is around 20% in the first two years, 46% in the first five years, and 33% in 10 years. They fail across all industries, not just clothing stores which are more prominent.

Nearly 3200 US retail stores closed in 2023 alone – huge retailers like CVS, Bed, Bath & Beyond, Walgreens and many more. So imagine what could happen for small mom-and-pop stores.

Rupal Agarwal, Co-Founder and CSO at Your Retail Coach

Pay-to-play social media platforms

There are huge risks to the pay-to-play model for social media. Social platforms are built on their users, no matter if the users are regular people who post cat photos or influencers who make a living off of the platform. Adding a pay-to-play model will create a divide between those who are able to pay and those who aren’t able to (or don’t want to). That divide could turn off many people from using the platform.

Shirin Ghaffary, Senior Correspondent at Vox

Single-product subscription boxes

Offering yet another subscription service that offers just one product, way less compared to many of the available subscription services makes no sense.

From a business perspective, managing shipping and logistics is complicated and expensive, and growth or scaling is extremely limited. There’s not much you can grow with only one product.

From a consumer perspective, they’re already bombarded by subscription services left and right. They are also used to a set standard so they have high expectations. And retention could be difficult. Receiving the same product over and over every month could get quite boring.

Silent music concerts

There are three key reasons why silent music concerts are a bad business idea: competition with traditional concerts, limited audience appeal, and audience interaction. There are very few people who would choose a silent music concert over a traditional one. It’s not restricting and it’s highly social. Plus, the costs for these concerts are huge and the return is very small compared to traditional concerts.

4 signs that your business idea is bad

Maybe we have missed that particular idea that has popped in your mind , so you are still not sure whether it is a horrible business idea? Lets have a look at some common factors that can help you decide whether your on business idea is a bad one:

You’re not excited or passionate about it – consumers can sense this from a mile away. If you’re not excited about your business idea, why would anyone else be? Remember, this would become your everyday life and working on something that doesn’t excite you never ends well.
You’re not making any sales – this is the most obvious one. At the end of the day, the success of a business is measured by dollars. Make sure to test the idea and gather feedback before officially launching it. But if no one’s buying what you’re selling, shut it down.
Experienced entrepreneurs tell you it’s a bad idea or aren’t willing to help – feedback from experts is crucial when starting out. They’ve already done it and succeeded. While advice should be taken with a grain of salt, it’s important to listen to feedback.
Too small or non-existent market need – if this is the case, don’t even try to force your business idea. If your niche and target market are too small, you’ll eventually hit a ceiling and growth will stop fast. If there’s no market need, no one is going to buy it. Just move on to a better idea.

Conclusion

There you have it. We’re sorry if we broke some hearts and dreams but we hope we’ve armed you with information you find useful – as detailed market research is a key before even thinking about starting any business. These are definitely some of the worst business ideas, so make sure to stay away from these and avoid a catastrophe.