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Hottest Business Ideas for 2002 Don't worry. These business may be smoking, but the only thing that will go up in flames is your status as "employee."

By Laura Tiffany

Opinions expressed by Entrepreneur contributors are their own.

The time has come. You need to walk into your boss's office,throw down your resignation letter and tell him, "Take thisjob and sho"--well, maybe don't go that far. Former bossescan make wonderful first clients. Nevertheless, 2002 isgoing to be your year, the year when you realize you've waitedlong enough to start your dream business and you actually go outand do something about it.

We'll help you with your first step--finding the perfectbusiness idea. This year, service businesses are reigning over ourlist of the 10 hottest business ideas for 2002. From computerconsulting and referral services to personal training and financialplanning, busy folks are still hankering after people who can maketheir lives easier and make their businesses run smoother. But forthose who'd rather sell a product than a service, don'tworry--we've got you covered as well.

Consulting Service

Consulting is one of those businesses that most peoplearen't too familiar with. They know the term, but really, whatdo consultants do all day long? What do you consult about?We'll clear up the confusion: According toMerriam-Webster's Collegiate Dictionary, a consultant isone who gives professional advice or services, an expert. It'sone more thing, too, according to us: a damn good industry to getin on.

"Consultants offer a fresh, objective point of view when anorganization is looking for answers to questions it never had inthe past," says Elaine Biech, author of The Business of Consulting. And this isa particularly salient point right now with a recession lingeringand layoffs occurring in all industries. "Layoffs don'tsignal less work for consultants," says Biech. "In fact,it's often just the opposite. The employees go away, but thework may not. Consultants can provide temporary people-power tocomplete projects that still remain."

To get a start in consulting, you will need solid experience andexpertise. John Hrastar began his McLean, Virginia, consultingfirm, InterSource, after building a $25 million business. "Myexpertise comes from being a real-world, serial entrepreneur,having an interest in a wide variety of industries, anunderstanding of the underlying processes that drive businessgrowth, and the ability to quickly learn, distill and communicate asituation when working with a client," say Hrastar, who offersCEO advisory services; interim CEO services, where he becomes theCEO of a company for a brief period of time; and CEO roundtablediscussion moderation.

"The key is to determine where your brilliance lies andthen offer it to clients," advises Biech. "Do a thoroughself-assessment: Explore your experiences, inventory yourcompetencies and assess your consulting aptitude." Also, talkto other practicing consultants to get a feel for the business, theday-to-day operations and the challenges. "The third step isto determine how much money you'll need to make and begin toestablish your business plan," says Biech.

Startup costs for consulting practices are minimal: A desk,computer equipment and high-quality marketing materials. "Youcan get by with few expenses to start a consulting business,"says Biech. "However, don't cut costs on your marketingsupplies. Do not shortchange your image."

Next Step

Here are some resources to get you started in your consultingresearch:

Entrepreneur.com Resources

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Financial Planning

A head for numbers and the stomach for the tumults of runningyour own business--if you can pass this anatomy test, then youmight be up for what the Jobs Rated Almanac 2001 calls thebest job in the country: financial planning.

This field is steadily growing: The number of certifiedfinancial planners (a designation regulated by the CFP Board ofStandards) has risen from 31,900 in 1997 to 37,101 in 2001. Thenumber of CFP Board Registered Education Programs has more thandoubled since 1996, from 87 to 213.

"Financial planning is a professional practice thatinvolves specialized knowledge in the areas of cash management,risk management, tax planning, retirement planning, investmentplanning and estate planning--and most important, an awareness ofthe interconnectedness of all these areas," says David B.Yeske, CFP and national president-elect of the Financial PlanningAssociation.

Financial planners almost always have a financial industrybackground, whether CPA, stock broker or even tax attorney."From there, you must add specialized knowledge aboutfinancial planning, with a goal toward becoming a certifiedfinancial planner," says Edward J. Stone, author of Getting Started in Financial Consultingand editor of The Journal of Corporate Accounting &Finance. "Increasingly, customers want financial plannerswho are certified. It demonstrates at least a minimum level ofcompetence."

Count your CFP courses as your first startup cost--though youcan't gain certification until you've passed the exam, havethree years of professional experience, and agree to abide by theCFP Board's Code of Ethics and Practice Standards.

Beware: If numbers are attractive to you but you must alwaysstick to a formula, this field probably isn't for you."Some people are attracted to financial services because theylike being able to measure things, to come up with precisenumerical answers," says Stone. "But that'sdefinitely not what it feels like to be an independent financialconsultant. You have to be a creative problem-solver. There are noformulas to follow."

In other words, you've got to be able to market yourservices, keep your own business finances afloat, work comfortablyon your own and communicate with clients. "You can't applythe technical tools of financial planning unless you also have goodlistening skills and a reasonable amount of empathy," saysYeske. "There is no one right answer when working through thefinancial planning process with a client, but, instead, manypossible solutions."

Next Step

Learn more about financial planning with these books:

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Patriotic Products

After September 11, you saw them everywhere: Flags on carantennae or attached to windows. Flags on lawns. Flags on shirts.Many were given away in exchange for charity donations. But many,many were sold at the local convenience store, the grocery store,the department store--hopefully with a chunk of change still goingto charity.

While marketing patriotic products during a time of nationalturmoil can be a risky venture, it can also turn out to be abusiness opportunity that can nourish both your entrepreneurialspirit and your conscience--if you go about it in the right way.John Landrum and Bill Russell both work in the film industry, butjust days after September 11, they were struck with a thought thatchanged both their lives: How can you show your patriotism whilealso supporting the peace movement? Hours later, Peaceflags.org wasborn.

But don't let the quick start fool you: The businesspartners struggled to find flag manufacturers that would take achance on their small company and surprisingly controversialproduct: an American flag with stars in the shape of a peace sign.In fact, CNN pulled a segment on Peaceflags as a result ofadvertiser pressure. "It's controversial in that the peacemovement is marginalized right now," says Landrum, who workedwith Russell to keep the flags completely U.S.-produced."Because we're providing the symbol of that [movement], wedefinitely became the chew toy of that battle."

They also struggled to find a way to get the word out abouttheir product. They first focused on nonprofit organizations likeNational Public Radio, but were shut out because Peaceflags.orgisn't nonprofit. (They explored the option, but Landrum says itwas a "bureaucratic nightmare.") With a scarceadvertising budget, they lucked out: Both Mother Jones andThe Nation offered online ad space for next to nothing, andtheir ad got the highest click-through rate--4 percent--in historyon both sites. They've since received 3,000 orders and donatedone-third of proceeds to charity, and they plan to keep thebusiness alive in hopes of finding a nonprofit purchaser forPeaceflags.org.

The moral of this story is, while the nation's attitude isripe for new patriotic products, it's not necessarily an easysell. Like any "hot" trend, getting started quick iscrucial--and getting started quick requires long, long hours. Butis it worth it when the trend will peter out? The current 50million flag market (according to the National FlagFoundation) will undoubtedly diminish over time, but 20 millionflags are still sold every year. So regardless where current eventsare headed, customers will still be looking for flags come Flag Dayand Fourth of July.

Next Step

Check out these resources on Entrepreneur.com:

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Referral Service

People are busy. Very busy. And many don't have the time orenergy to scour the Yellow Pages and call around for price quotesand credentials when looking for services like attorneys, childcare and home repair. So what do you do? Create a network ofsuppliers, check their credentials, charge them a referral fee, andopen up shop.

Referral services are a brilliant way of capitalizing oneveryone's favorite marketing tactic: word-of-mouth. "Myhusband and I had just purchased our first house and werestruggling to find reliable home-improvement contractors,"says Debra M. Cohen, founder of Hewlett, New York-based Home Remedies ofNY Inc., a home maintenance referral agency with 220 licenseesnationwide. "When I finally found a responsible contractor, Ifelt compelled to share his name with other homeowners in need ofhis services."

One of the most famous referral services is 1-800-DENTIST, atoll-free service where users can call and find recommendeddentists in their area. Other types of referral services includeattorney, elder care, child care, apartment and even sleepawaycamps.

"The balancing act in operating a referral business is,you're providing a service to two separate groups ofpeople," says Cohen, who spends much of her day on the phone."[I] earn commission for any work secured from the contractorsI represent. At the same time, I select contracts carefully so asto maintain a high standard of quality and service for thehomeowners who use my services. Ultimately, both groups need to besatisfied."

Next Step

Need some inspiration for deciding on a referral business tostart? Check out some of our Startup Kits and guides:

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Personal Trainer

Personal training isn't a lot of things: It isn't justteaching aerobics. It isn't sweatin' to the oldies. What itis is a field that requires a great deal of experience, educationand knowledge of the human body, how it works, how it hurts and howyou can help someone recover from injuries and/or get into the bestshape of their life.

Ayrn Singler studied sports medicine at Michigan StateUniversity and has a host of letters behind her name that spell outonly one thing: how experienced she is. And those letters make allthe difference in her eponymous training business. "Iattribute my success to the fact that I do have a sports medicinebackground and rehab-based knowledge," says Singler, who hasan office in her Fort Lauderdale, Florida, home and rents space ina local studio for training sessions. "I know a lot more thanthe normal personal trainer."

Singler suggests that anyone seriously interested in personaltraining get a bachelor's degree in a health-related field likeexercise science or kinesiology. This is also a must if you want toget certified by the National Strength & Conditioning AssociationCertification Commission, the only nationally accreditedpersonal training certification--and one of the sources for allthose letters behind Singler's name.

Another helpful way to get a feel for the industry is to get ajob in it. "Find a job that gives you the chance to learnwithout spending great amounts of money to get in the field,"advises Mark Occhipinti, M.S., Ph.D., with American FitnessProfessionals & Associates, a membership association thatprovides resources and training. "If you really enjoy thework, then it is good to pursue further education andtraining."

As for startup costs, they're minimal. Singler got startedfor $4,000, which included office equipment and clothing forsessions. She stresses the importance of image in an industry whereyou often work with higher-end clientele. She has also saved moneyby benefiting from the cheapest marketing method ofall--word-of-mouth--by letting her experience and skills speak forthemselves.

Next Step

Get your new personal-training business whipped into shape withthese books:

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Tech Consulting

IT spending is down this year--it's true. But afterincreasing year after year for the past decade, there's still ahuge market for tech consultants. IDC estimated that worldwidecorporate spending on online initiatives would reach $700 billionin 2001, with U.S. companies spending $260 billion on webinfrastructure in 2000.

Who's the market for tech consulting? "Any firm usingIT systems. In other words, almost any firm," says DonMcLaurin, CEO of the National Association of Computer ConsultantBusinesses, an organization that represents IT servicesfirms.

As far as choosing a specialty, let your imagination and yourskills determine that. Computer consultants can focus on softwaredevelopment, network engineers, security, programming, webdesigners...the list goes on and on. "People specialize[within these areas] as well," explains Gloria Metrick, ownerof GeoMetrickEnterprises, a Cincinnati-based computer consulting firm thatspecializes in managing laboratory data, and board member of theIndependent ComputerConsultants Association. "For example, there are manyprogramming languages a consultant might specialize in. Anothertwist is, some consultants specialize in a functional area or asubset of a functional area. For example, I work with a specifictype of laboratory system known as LIMS (Laboratory InformationManagement Systems), and I perform all tasks within the type ofsystem I work with."

To get started, you need a good amount of experience in the areayou're specializing in. Before striking out on her own, Metrickhad worked for a LIMS end-user and a LIMS vendor as well assubcontracted at a LIMS consulting firm. "Consultants cannotbe 'run-of-the-mill' talent," says McLaurin."They usually need at least three years of practicalexperience. [And,] unless they are in some really esoterictechnology, they need good soft skills, i.e., communications andrelational skills. More than 80 percent of consultants are askedoff of assignment because of nontechnical reasons."

Next Step

Put your high-tech know-how to good use with help from thesebooks:

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Online Games

When Tina Louise Feldman, 27, and Alan Balode, 25, begancreating online games for Internet sites a few years ago, everyonethought their idea sounded like a sure thing. Now, Feldman says,when people hear that Ultimate Arcade Inc. develops games fordotcoms, they say, "Oh, I'm so sorry.' But we'redoing great."

So is the online game industry as a whole. It's expected togrow to $5.6 billion by 2005, according to market research firmJupiter Media Metrix. Feldman and Balode's Calabasas,California-based company has seen business double in just the pastsix months. Their clients are small (insurance companies, nursinghomes) and big (Disney, Levi Strauss and Warner Bros.).

Eventually, Feldman says, they'll branch out into doingonline games people will pay to download. But for now, they'resticking to where the big money is: gaming sites offered bybusinesses with something else to sell. "We're going tosee more and more companies [using] online games," says GlennPlatt, professor of economics at Miami University in Oxford, Ohio,and director of its Center for Interactive Media Studies."Companies want to give consumers a reason to come to theirsite, to stay at their site and to come back to their site,"says Platt. "And online games is the ideal medium for that, ifyou've done a good job. [Games] create a sense of community,and the users feel like they're part of a special club, whichcan be valuable for any organization." Platt created an onlinehockey game with his students a few years ago to help Procter &Gamble promote its Febreze fabric freshener. P&G was trying toimprove its sales with college students, says Platt, adding,"They figured college kids would have smelly clothes." Togain the kind of following Ultimate Arcade enjoys, your games willneed to stand out. "With all the competition," saysPlatt, "companies need to keep making these games better, moreinteresting and more sophisticated." -GeoffWilliams

Next Step

Surf over to these sites for some gaming inspiration andinformation:

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Maternity Clothes

Celebrity moms like Cindy Crawford and Kelly Ripa aren't theonly ones who know that muumuu-style maternity clothes are so lastcentury. Today, pregnant women are all about celebrating theirstyle and looking sexy. From high-end maternity designers like LizLange and A Pea in the Pod to midpriced maternitywear newcomers TheGap and Old Navy, clothing designers are on to the potential ofthis growing market. With more than 4 million babies born annually,it's easy to see why the maternity clothing market isbuzzing.

Peg Moline, editor in chief of Shape's Fit Pregnancymagazine, has seen a boom in sexy and hip maternity clothing aswell as in athletic maternitywear. And with more pregnant women onthe job, maternitywear has to provide workplace comfort and style."[Clothes] have to be really comfortable, really sharp-lookingand also very hip," says Moline.

Enter LSR Maternity. Specializing in lingerie, LSR founder LauraS. Rudolph describes her products as the "Victoria'sSecret of maternitywear." Founded in 1996, Aurora,Colorado-based LSR was born out of Rudolph's frustration withthe dearth of sexy, well-made and affordable maternity fashions onthe market. Rudolph filled the void with lingerie the average womancould afford. "It's not about income levels and socialstatus," says Rudolph, 36. "It's about who wants tofeel beautiful and sexy during pregnancy." Rudolph'sprices range from $48 to $84, and she plans to release alower-priced line through her online store and specialty boutiquesnationwide.

Need more proof this market is worth a look? LSR Maternity'srevenues have increased 300 percent over the past six months, andRudolph is projecting sales of up to half a million dollars in2002. -Nichole L. Torres

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Online Learning

You can teach an old concept new tricks. While many onlinecompanies appear pale under the economic spotlight, e-learningbusinesses are looking rosy. Employee training, internet collegecourses and classes catering to the fresh legions of home-schoolersare booming areas. IDC expects the corporate e-learning marketalone to top $18 billion by 2005, up from $2.3 billion in 2000.

Stephan Thieringer, 35-year-old CEO and co-founder of Danvers,Massachusetts, business training company GTF Systems, is familiarwith what it takes to successfully launch a virtual educationcompany. "The market is huge," says Thieringer. "Themistake a lot of companies make is, they get very broad-ranged. Weare very specialized." GTF Systems' focus on state- andfederal-mandated compliance training and human resources solutionskeeps it plenty busy in its niche market.

Thieringer explains one of the key factors poised to make 2002 agood year for e-learning entrepreneurs: "The community hascome to the point where distance learning isn't necessarilyconsidered an inferior education." The arrival of accreditedonline-only universities like Capella University of Minneapolis is proofpositive of this growing trend. Look for business opportunities notonly in providing courses and continuing education programs, butalso in servicing the peripheral supply and material needs ofdistance learners.

While there is a high awareness of online college-level classes,there are also interesting e-learning developments a little closerto home. According to the National Home Education ResearchInstitute, 1.3 million to 1.7 million children were home-schooledin 1999 and 2000. No exact figures are available for 2001, but thehome-schooling movement has gained significant steam during thepast few years, making K-12 education a hot area for entrepreneurs.Fronted by William J. Bennett, former Secretary of Education underformer President Reagan, K12 in McLean, Virginia, has made a high-profile entryinto this area by offering curricula and supplies geared toward theelementary market. But there is still plenty of room on thechalkboard for small companies to make their mark.

Thieringer sees a wide landscape for e-learning startups, but heemphasizes that the basics of customer service and specializationare required for success. "It's about content," hesays. "It's about the scalability of the product. It'sabout the bandwidth requirements. It's about ease of use."Virtual learning entrepreneurs prepared to balance the knowledgewith the technology will move to the head of the class in 2002.-Amanda C. Kooser

Next Step

Learn all you can about online learning before you get started.Check out these books by Rena M. Palloff and Keith Pratt, collegeinstructors and experts in the field of developing online learningcommunities:

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Life Coach

Business coaches have been around for years, but today many aremorphing into life coaches. After all, life and business areintertwined, and many people need help in both areas. Life coachesgenerally charge between $300 and $500 a month for a weekly30-minute phone call, in which they help their clients set goalsand motivate them to achieve those goals. Life coach KarenChildress, 42, in Peterborough, New Hampshire, says,"[Clients] tend to stay with coaching for a few months to afew years; if it didn't work, the industry wouldn't begrowing."

And it's definitely growing. Bobette Reeder, president ofthe International Coach Federation (ICF) in Washington, DC, notesthat when she received her coach training in 1995, there werepossibly two credible coaching colleges. Today, 42 recognizedschools offer coaching education and training, 10 of themaccredited by ICF. And ICF, which boasts 4,500 members, is growingby some 200 members each month.

Childress says you can make more money if you recruit corporateclients and offer additional services. For instance, in the past,she offered clients her own brand of do-it-yourself life coachingfor cash-strapped clients. Members would pay $12.95 a month to set,organize and monitor their goals online. Combining the dualconsumer demands of coaching and convenience is just one wayentrepreneurs can use their fertile imaginations to fuelopportunity as a life coach. -Geoff Williams

Next Step

Be someone's hero. Read these books to jumpstart yourlife-coaching business:

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