Case Study: 2008 and 2020 Sales Increase
Investing in a business is always a risk. Many business owners wonder how their business will perform in a recession. Some businesses supply basic needs and aren’t impacted by recessions like other businesses. Ice House America is one of them. Sales numbers show ice and water vending businesses even perform better during a recession.
Case Study: 2020 COVID-19 Pandemic
2020 introduced more change and uncertainty, both in markets and in daily life. This recession was unlike others we’ve seen from market trends, deregulation or economic cycles. This recession was caused by a need for greater public safety in the face of an illness. Many businesses shut down or reduced their workforce in an effort to reduce contact between workers or patrons. This recession impacted businesses differently than many others. However, Ice House America ice and water vending machines again saw an increase in sales.
During full lockdown in April, sales remained steady compared to the same time in 2019
May through June in 2020, ice sales increased 10% compared to 2019
Machines equipped with water vending increased sales even further, 30% compared to 2019
Why did sales increase in 2020?
Like the previous recession, many factors influenced Ice House America’s ice and water vending machines’ success. Once again, ice and water are staples, so demand does not sink like other industries, even when income fell or stagnated. Sanitation was and continues to be a high concern. The touchless interface and the extra cleanliness of bagged-on-site ice likely also played a role in the sales increase. Loyal users continued to use the machines during the pandemic, and more users started with an increase in sanitation and social distancing concerns. Concern over the availability of staples also caused a period of panic buying for items like canned foods and bottled water. This may have also played a role in the sales increases, particularly the notable increase in water sales.
Case Study: 2008 Great Recession
2008 was a year of change and upheaval. Between 2008 and 2010, about 1.8 million small businesses were forced to close. Problems in the housing market and banking system created long-lasting effects that can still be seen today. However, not all industries were affected equally. The Great Recession was a true test of a business’s performance. Ice House America ice and water vending machines saw increased sales during this unstable time.
Why did sales increase in 2008?
There’s a number of reasons ice and water vending businesses aren’t affected by a recession in the same way as other businesses. First, ice and water vending machines provide a staple. Reliable access to clean water and ice remains a consistent need regardless of demand in other industries. Second, start-up costs for these businesses are low compared to other businesses. This means ice and water vending machine owners weren’t affected as dramatically by problems facing big banks and their patrons. Third, rent and real estate costs are comparatively low as well. Ice and water vending machines require only electrical and water access in an empty lot, parking lot, or part of an existing storefront. This means foreclosure and rising rents don’t impact these businesses as dramatically as others.
Confidence in Stability
“Before Ice House America, we could not have imagined an opportunity that has a low time commitment and no employees. It is rare to find a business that has low overhead and allows you to invest in a $4 billion industry that is essentially recession-Resistant. We could not be happier with how this new adventure of ours has turned out.”
—CHRIS AND LISA NORRIS
Owners, Missouri-based location
“Having a background in the dry ice business, I had a pretty good understanding of the potential for the ice industry. However, I was not expecting how successful of a business model it would be when ice vending and water are combined at one convenient location. IHA has exceeded all of my expectations, and I look forward to growing this new business venture for many years to come.”
Owner, Boston-based location
“Our previous business experience taught us that most successful businesses offer great products and service that customers love and recommend to others. The business opportunity offered by Ice House America allows us to provide products and service that deliver exceptional value and customer experience to our local community.”
—MARK AND ELIZABETH SELLERS
Owners, three Texas-based locations
When a recession hits, the economy contracts. This is a circular process; consumers make fewer purchases, businesses make fewer sales, employ fewer people, and the process repeats. However, even during this process, some businesses and industries are not affected by recessions in the same way, or at the same rate.
Millions of Americans are looking for a new job during COVID-19, either to make ends meet in the meantime, or to find a completely new career that will decrease their risk of infection. If you’re considering a career change or new job during a pandemic, use these considerations as guideposts.
Those concerned about an impending downturn in the economy might wonder about businesses that stay steady or perform well during recessions. While many factors go into a business’s performance, some businesses are very close to “recession-resistant.”