The Best types of companies to start in California

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At best, California‘s business environment is as sunny as the climate, a place where large corporations, long-term family businesses, and successful entrepreneurs thrive. There are millions of small businesses in this state to meet the needs of the largest population in the country.

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NerdWallet analyzed the data to find the industries where some companies perform best in Golden State. The best types of businesses to start in California include shops, salons and spas, educational businesses, and e-commerce, which are booming.

NerdWallet examined 186 industries classified according to the North American Industrial Classification System in this study. We measured job growth, wages, revenue growth and regulatory burdens to find the top 10 types of companies to start in California. For more information, see the section on methodology at the end of this article.

1 Eat keys

Are small. Depending on the number of employees, each of the 10 best industries on our list is less than the median at the state level of 17.8 employees per company. Real estate companies, with 4.5 employees per company, and personal care, with 5.4 employees per business, had the fewest employees.

The high income per employee. In many of the top 10 industries, wages exceeded wage costs. From 2007 to 2012, for example, revenues for e-commerce companies increased three times faster than more employees.

The best business has high income and low pay. Most companies have trouble earning high incomes while keeping wage costs under control. Those with higher incomes tend to have expensive labor. The only exception is the best gas stations, which have managed to pump revenue with relatively cheap labor.

I’m safe. The 10 best industries have some of the lowest safety risks for workers. All 10 industries received citations from the Occupational Health and Safety Administration, at a rate well below the national average of 1.67 citations per 100 firms over the course of a year, and eight on our list had OSHA penalties per citation. Below the state average of $ 1,247.

The best types of business to start in California

2 Gas stations

The car culture is deeply rooted in the Golden State, so it is no wonder that petrol stations are at the top of the list of the best new establishments. The state has around 8,000 gas stations, which employ 54,500 people. Revenues from the petrol station industry increased by almost 25% from 2007 to 2012, when petrol prices reached historic highs. Since petrol is traded – which means that prices are largely uniform – and some petrol stations face stiff competition, profit margins are likely to fall in this industry. California is taking steps to encourage cars without emissions and alternative fuels, including a recent order setting a target to reduce greenhouse gases by 40% below 1990 levels by 2030. However, about 96% of fuel oil depends on the state’s transportation needs, according to the California Energy Commission. This confidence plus an aging mass transport system means that the demand for petrol stations will continue to grow. By far the largest gas sales are in Los Angeles County, according to the California Energy Commission. Other areas with high sales include Orange, San Diego, and Riverside counties. Gas stations are heavily regulated, especially when it comes to taxes, but the state provides resources to operators. The California Independent Oil Marketers Association is a trade association that represents wholesale and retail fuels.

3 Electronic commerce

E-commerce, better known as e-shopping and mail-order houses, includes retail companies that only use printed or electronic prints or catalogs to sell goods. Online shopping business is easier, faster, and cheaper to install than a brick counterpart. There are approximately 5,000 companies with 55,000 employees in this industry in California. Revenues are high – each employee earns an average of $ 958,300 – for a total industry revenue of $ 52.66 billion in 2012. The size of the workforce increased by 27% from 2007 to 2012. Silicon’s thriving technology industry Valley and the San Francisco Bay Area have contributed

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