Want the incredible income that comes from owning a profitable business but don’t want the headaches of running one?
You need to own a business that runs itself.
I know it sounds impossible and too good to be true, but these businesses are out there.
Businesses that run themselves fall into two camps: (i) those that are so simple to operate that they run without your active involvement; and (ii) those that are complex but have employees that run the day-to-day operations.
Either type can be a great option and we will explore businesses in both categories below.
In this article, we will cover the following topics (click on the link to jump straight to your desired topic):
- Traits that Allow a Business to Run Itself
- How to Start A Business That Runs Itself
- How to Buy A Business That Runs Itself
- 12 Great Businesses That Run Themselves
Let’s get into it!
Note: If you prefer to see a condensed version of this article in video format, check out my YouTube video below.
This post may contain affiliate links. If you click on a link and complete a transaction, I may make a small commission at no extra cost to you.
The information contained in this post is for informational purposes only. It is not a recommendation to buy or invest, and it is not financial, investment, legal, or tax advice. You should seek the advice of a qualified professional before making any investment or other decisions relating to the topics covered by this article.
Traits That Allow a Business to Run Itself
Not every business can run itself.
Some businesses are too complex or require the involvement of the owner to be successful.
So how can you tell if a business is suitable to run itself?
Businesses that are good candidates for running themselves exhibit the following traits:
- Business Has Simple Operations
- Business Doesn’t Need Owner’s Specialized Skills
- Business Is Established and Has Strong Management
- Detailed Processes and Procedures Help Run the Business
Business Has Simple Operations
Simple operations are a clear sign that a business can run itself. The simpler the operations, the easier this is.
For example, a business with really simple operations will have no inventory to manage, no customer interactions, no physical location to oversee, no complicated marketing strategies to implement, no employees to manage, no order fulfillment, and limited legal requirements to follow.
Think they don’t exist? They do – see my #9 business below.
On the flip side, a business with complex operations may exhibit the following:
- Extensive inventory management
- Complicated marketing strategies (businesses where constant lead generation is critical)
- Lots of customer interaction (think any retail establishment with walk-in traffic)
- A large employee base to manage
- Operation and maintenance of complicated equipment (factories, etc.)
- Extensive or complicated order fulfillment (e.g., e-commerce, highly technical services).
- Complex legal or regulatory requirements (banking, finance, insurance, etc.)
Business Doesn’t Need Owner’s Specialized Skills
If a business depends on your specialized skills, knowledge, or relationships, it can’t run itself. I am talking about businesses like professional offices such as those run by lawyers, doctors, accountants, real estate agents, etc.
The value of that type of business is in the person who has the knowledge, skills, and client relationships. It’s very hard to step away from that type of business if you are the owner.
Business Is Established and Has Strong Management
This is the big one. Most successful businesses that run themselves use strong management and well-trained employees to handle their daily operations.
You want an established business, if possible. If it’s been around and has weathered economic downturns, it won’t require your constant attention when there is a recession.
If it also has a great management team in place that can run daily operations, you have a winner.
Small mom-and-pop businesses usually won’t qualify here. You will need a business that generates enough revenue to support a strong management team and that means you will either have to pay up for a business like that or you will need to devote a lot of time to build up a business to that level of revenue.
These are the types of businesses that firms like Blackstone, Warburg Pincus and other large private equity firms buy. They have a portfolio of self-running businesses with a lot of upside and essentially let management do their thing (and sell for a profit when the time is right).
Of course, your business does not have to be at this level to be self-running. Even a much smaller business can have the right characteristics to operate without your day to day involvement.
Business Has Processes and Procedures in Place
A comprehensive operations manual will allow an owner to more easily step away from the day-to-day operations of the business.
An operations manual is basically a roadmap for how to run your business. It lays out how a company does things or gets things done.
The more comprehensive and detailed, the better. If every process is laid out for how you run the business, there is very little room for error or guesswork. That’s the beauty of a franchise like McDonald’s for example. Every step of making the product and operating the business is spelled out.
You train the manager on those processes, and they train the employees. Once everyone knows how to operate the business according to the manual, and the manager makes sure that everyone is doing things the right way, there is far less for the owner to do to run the business.
Closing Thoughts on the Four Traits
The four traits we just covered are indicators of a business that can run itself, but you should not use them to robotically assess a business. For example, if a business has incredibly simple operations, it may not need a management team or a meaty operations manual.
On the other hand, a complicated business that has a very strong management team can absolutely be run without active owner involvement. After all, their entire purpose is to take care of the day-to-day operations.
Think of these 4 traits as factors you should consider, not boxes you should check.
How to Start a Business That Runs Itself
The first thing to do is identify what type of business you want to start. The four traits we just covered (and the 12 examples we give below) should help you narrow it down.
Now, nobody should actually start a business that runs itself. Let me clarify what I mean. If you want to start a business and eventually turn it into a business that runs itself that is fine.
But you should never set up a business, hire a bunch of people to run it for you, and step away without ever operating the business yourself or learning anything about the business. That’s a recipe for disaster.
You should only start hiring managers and other staff once you are deeply familiar with the business and have figured out how to operate it successfully.
Only then can you train your employees on how things should be done.
If you try to skip past this, you are taking on a very big risk.
If the company’s business declines, you won’t have the first clue what is wrong and how to fix it. If your manager leaves, you could be in real trouble because you won’t be able to operate the business yourself until you find a replacement.
Just don’t do it. You are probably going to be investing a lot of money into this business – don’t ruin your chance to create a great business in your rush to make it run itself.
Bottom line: You should position your business for success before you try to outsource day-to-day operations.
Now that we cleared that up, you can absolutely start some phenomenal businesses that can eventually run themselves. The 12 examples below are great places to start looking.
We have some in-depth guides (with step-by-step instructions) on almost all of the 12 examples listed below, so I would definitely check those out.
How to Buy a Business That Runs Itself
If you want a business that runs itself, I think buying one is a far better choice than starting one.
Starting a business already carries a ton of risk. You don’t know if it’ll be profitable, let alone profitable enough to support a management team that can relieve you of your daily responsibilities. Buying an existing business, on the other hand, is far less risky. It should already be making money and possess many of the traits that you are looking for.
Here are some key questions you will want to consider when buying a business that may be able to run itself.
- Has the business been through at least one significant recession?
- Does the business have an experienced management team?
- How much work does the current owner do for the business?
- What type of work does the current owner do for the business?
- Do you have any experience in this type of business?
- Do you have skills that translate easily to this business?
- Is the owner willing to train you on the business?
The answers to these questions should point you in the right direction when deciding on which business to buy.
Once you are ready to begin your search, I think the best place to start is online. You will be able to browse hundreds of listings in your area at every price point.
Below are some of the best sites that offer businesses for sale (tip: you can google search “absentee run businesses for sale” to get relevant search results for these sites)
12 Businesses That Run Themselves
A laundromat can be a terrific business that runs itself.
After all, the machines are doing the hard work of washing and drying the clothes (with your customers doing the work of loading and unloading the clothes).
The process is mostly automated, but not completely. There are things you will need to do to successfully have this business run itself.
Want to learn more? Check out my article on starting a passive laundromat in six easy steps.
For an in-depth discussion of how to run a laundromat as an absentee owner, check out my article on this topic.
2. In-Bay Automatic Car Wash
Here’s another solid choice. In-bay automatic car washes are about as automated as you can get when it comes to a car wash.
These types of car washes are usually unattended and you often see them at 24-hour gas stations, convenience stores, etc. People just pay for their ticket, pull their car into the bay and the machines do the rest.
If you are interested in this type of self-running business, check out my beginner’s guide on how to get started with a passive automatic car wash.
3. Vending Machines Route
Owning a vending machine route can be a great business that runs itself. The idea is that you place a bunch of vending machines in high-traffic locations and make money every time someone buys something from your machines.
The only part of this that requires some work is restocking and collecting money from the machines, but you can easily outsource this function.
You will also want to install your machines with helpful technology that can make you operate your business remotely, such as modern payment readers and inventory tracking software that tells you when you are running low on product.
The software also keeps track of every penny that goes into the machine, so you can hire route runners without worrying so much about them skimming off the top.
For more details on this business, check out my beginner’s guide on how to start a vending machine route for passive income.
4. ATM Machine Route
Like vending machines, this type of business involves you placing ATMs in high traffic areas and receiving a fee every time someone makes a withdrawal.
But it’s even simpler to operate than a vending machine route. You don’t have to worry about buying 17 different types of snacks and drinks and lugging them around in your van.
There is only one type of inventory you need and that’s cash. Fortunately, there are services that can restock your ATMs with cash for a fee.
Interested in finding out more? Check out my beginner’s guide to ATMs for Passive Income.
5. FedEx Route Business
Did you know that you could buy a FedEx delivery route that covers a designated territory? That means that you will make money for each delivery made within that territory. It can be a highly profitable business and, if you structure it right, it can run itself.
The business is very simple. You just need to focus on making the deliveries within your territory on time.
And that can easily be outsourced. In fact, most owners have multiple routes – they are not driving a truck and making deliveries.
Once you have good managers and reliable drivers in place, the day-to-day operations of this business can be run without your involvement.
If you want to learn more about this business, check out my beginner’s guide to owning FedEx routes for passive income.
6. Bread Routes Business
Like a FedEx route, you can buy a bread route that covers a territory. Once you own that territory, you can sell bread to various retailers and pocket a commission for each sale.
Best of all, you can have drivers run these routes for you. At that point, the business basically runs itself.
To discover more about this business, read my article on buying bread routes for passive income.
7. Billboard Rental Business
Renting out billboard space can be a solid business that mostly runs itself. Like any other asset that you can rent out, billboards generate money without you having to do much of anything.
Of course, like with all of these businesses, the billboard business is not completely automated.
You will need to oversee the business, including finding new customers who want to lease out billboard space from you when the current customer’s lease expires, etc., but day-to-day operations are pretty much non-existent.
Want to learn more about this business? Check out my article on how to get started in the billboard business.
8. Bounce House Business
I am sure you have seen bounce houses before and understand the appeal that they can have for parents who want to do something special for their kid’s birthday or other special occasion.
The great thing about this business is that it is really easy to structure this business to run itself.
You can simply outsource the work-intensive part of this business. After all, these bounce houses are just plastic structures that you deliver, set up, and inflate. When the rental period is over, you deflate the structure and pack it up.
It is not complicated and you can find and train people to do this for you pretty easily.
For more information on how to start a bounce house business, read my article on the topic here.
A blog may be my favorite business that can run itself. Now I am not talking about starting a new blog. That is not a self-running business, especially if you are writing your own articles like I am.
What I am talking about is buying an existing money-making blog where the prior owner did all of the hard work of writing the articles and making sure they generate money.
These existing blogs can generate high revenues relating to their price and can be run almost entirely without your active involvement. You can buy an existing blog for 25 to 40 times its monthly revenue on sites like Flippa, Empire Flippers, and FE International.
Among the three, I really like Empire Flippers because they strike the perfect blend of high quality vetting (so you don’t see a bunch of scammy websites being sold) while still having a ton of profitable options to choose from.
They get a new batch of websites for sale each week (on Monday morning), so you can predictably see what’s new and jump on any great deals that are unveiled. I am an active user and love their service.
Ok so getting back on topic, if you buy a blog for $10,000 you will be earning between $3,000 to $4,800 per year. That gives you an annual cash flow of 30% to 48%!
And unlike other businesses, there is no physical location to oversee, no inventory to manage, no marketing needed (if you write good articles, google sends traffic your way), no customer complaints to address, no employees to supervise, and no orders to fulfill.
Blogs are generally monetized through ads or affiliate links placed on the website. That’s just a fancy way of saying you can get paid every time someone visits the blog and views or clicks on an ad or buys a product you are promoting through one of your affiliate links.
It’s really that simple.
To read more about buying blogs, check out my detailed article on the topic here.
If you don’t have the funds to buy a blog right now and don’t mind putting in the work to start one, check out my article on How to Start a Blog From Scratch.
I cover all of the key areas you need to know, including how to set up your website and most importantly, my best tips for writing great articles, getting traffic to your blog, and monetizing that traffic.
If you don’t have the time or inclination to do this on your own, you can hire a service to create a website for you. Niche Website Builders is a UK based firm that specializes in this.
I have used their content writing service to help me expand my blogs when I was running short on time, but they do offer a full service model, where they will create your website for you from start to finish and include content that has gone through their rigorous keyword research process.
Check them out here if you want to learn more.
10. Rental Properties
A rental property business is another business that can run itself.
The obvious solution is to simply hire a property manager for your rentals. This is an extremely common practice among rental property owners (in fact, anyone who owns property outside of their local area basically has to use a property manager).
Property managers will find tenants, screen them, and sign them up for leases. They will collect rents, make repairs, and basically take care of every issue that pops up when it comes to your rentals.
I own nine rental properties and self-manage them, so it’s a little more work. But even then, it’s hardly a daily grind. I may spend on average about 5 hours a month managing these 9 properties (I do outsource all of the repairs, etc. to my team of contractors).
That’s pretty much a self-running operation in my view.
If you want to learn more about rental property investing, check out my step-by-step guide to start investing in rental properties.
This one is interesting.
I was a hair’s breadth away from buying an absentee-run bakery last year, but then the pandemic hit as we were in negotiations. I pulled out because it was a scary time to be buying a retail bakery. But I loved the business!
It was in a great location and had been in business for over 20 years. The owner had in place a chief baker and several experienced assistants that had been working at the bakery for almost the entire time. He also had a team of workers manning the front of the store. I saw the business up close and personal: Everyone knew what to do every day and it operated like clockwork.
It was on the market for approx. $700,000 and made on average around $250,000 per year.
It seemed like the perfect example of a business that essentially ran itself. And it was: In fact, the existing owner did not know how to bake a single item!
12. Self-Storage Facility
Want to own a profitable and passive real estate business where you don’t have to deal with tenant complaints, broken toilets, and the usual hassles that come with managing rental properties?
The unmanned self-storage facility may be perfect for you. As the name implies, the facility is unmanned, which means it can basically run itself.
With this type of business, you can enjoy a combination of high returns and low maintenance, all wrapped in the security of a business that has a success rate of 92%!
If you want to learn more, check out my guide to starting a passive self-storage business in 7 easy steps.
So there you have it: 12 great businesses that can run themselves and some guiding principles to help you find even more.
Hope you found this guide helpful and best of luck finding the perfect business for you!