> It can be quickly regained

I'm not sure what you mean with this?

Sure, hypothetically e.g. any western car manufacturer could poach a bunch of BYD employees. But it's not really practical for most businesses.

> The actual problem is, there is no market to go up to anymore.

This is the "Market for Lemons" problem, yes.

It's less of a problem than you might think. Convincing the entire wider world that you're legitimate is a problem. One made infinitely worse by store marketplaces like Amazon preferring to push "aqekj;bgrsabhghwjbgawrjwsraG" brand garbage.

So you just don't. The trick is to start small. The smallest you can sustain. (This doesn't work for cars, or anything that's sufficiently complex. You won't be taking on Salesforce.)

But so long as you can find a market niche where there's demand for quality, you can carve out a living, and from there, scale up.

The problem with that is twofold: Venture Capital has supplanted other forms of investment and "small business generating single digit millions in revenue" is utterly unappealing to VCs, even though the investment required is downsized accordingly.

And problem #2: The cost of starting a business is too high right now. Real estate and cost of living just make it unaffordable to even try. + Healthcare if you're in the US.