From sales projections and marketing strategies to manufacturing costs, distribution methods, and merchandising, there are countless factors to consider when starting a new business. One of the most obvious influences to the success of your start-up can sometimes be overlooked: location. You may have a great idea for a new product or service, but have you considered how much better that idea could thrive in the ideal geographical, economical, and social environment?
While there are standard metrics which most businesses use to gauge the potential success of their home base, including taxes, job rates, and income levels, there are less traditional aspects to consider in today’s more uniquely engaged consumer market. Small businesses in the U.S. are thriving better than ever thanks to a positive shift in consumer and entrepreneurial behavior. Here are some tips to targeting the right hot spot to commence your business venture:
Concentration of Other Small Businesses
Unlike large corporations and traditional big-box retailers that mainly spell competition amongst one another, small businesses tend to find success in familiar company. The most successful start-ups thrive most within small business communities: cities with larger, denser populations of other emerging companies.
Today’s startups are developing their own ecosystems in unlikely cities. Entrepreneurs attract other entrepreneurs in a way that yields mutual support and cross-promotion. A new restaurant may source their meats from their neighborhood’s butcher. An emerging apparel brand could utilize local screen printers. And a startup SEO company, app developer, and other web services businesses can aid the community of small business in promoting their goods and services throughout the surrounding market.
Areas with High-Growth Industries
A city that is trending in a particular industry can be a good indicator that start-ups should set up camp. A rapidly growing industry within a certain city can have a huge, positive impact on the more standard qualifying factors for running a small business, including spikes in income, housing, and general population growth.
Cities with growth in more “conventional” industries, such as agriculture, mining, machinery, construction, and even real estate, can be a great breeding ground for smaller businesses that support those industries or merely benefit from the growing working population that they yield.
Access to Resources
The key to sustaining any new businesses is access to resources. Cities with acclaimed colleges (especially those renowned for concentrations in particular fields) provide large and consistent pools of potential employees eager for positions within their line of study; younger, freshly educated workers with a firmer grasp on today’s business trends and practices.
Consider an area’s prevalence of potential investors and venture capitalists if your start-up could use some external financial resources. If your business requires large-scale distribution, think of more centralized cities for the most economical logistics and access to potential distribution partners.
As the owner of a small business, your base of operation will ultimately fall wherever you are willing or comfortable to consider home. Use these factors as a guide, but always bear in mind your particular product or service, target industry and demographic, and overall style of operation. With today’s innovative marketing tactics, and some personal hard work, a start-up business can thrive virtually anywhere; but considering your location can lend significantly to your business’ launch, growth, and long-term trajectory. Here are a few cities—outside of New York and LA—known for cultivating thriving small-business communities:
Washington, DC: perhaps still best known for big government, the District has made strides in developing its social and cultural identity outside of Capitol Hill. As the next-big-melting pot for national (even international) residential transplants, DC’s up and coming industries are somehow both niched and eclectic. From specialty restaurants and bars, to consulting and tech startups, Washington’s diverse population yields a talented, educated workforce and a powerful consumer market.
Boston: with five top-ranked hospitals, Boston’s medical scene makes way for start-up innovations in healthcare tech. Funding and training resources are abundant, including state government contributions through the Massachusetts eHealth Institute, and healthcare incubators like Athena Health and Health box Studios.
Salt Lake City: a thriving tech hub for both software a hardware companies, Utah’s main metropolis has seen a surge in small business over the past few years. Home to early-day software giants like Novell and Word Perfect, Salt Lake City lays stable ground for emerging companies. And as the missionary base of the Mormon Church, Salt Lake also has the one of the highest foreign-language speaking populations in the country, making for a skilled and stable workforce.
Baltimore: home to Johns Hopkins University—proclaimed by U.S. News & World Report as one of the top grad schools for education—the Maryland city has become a beacon for education technology start-ups. The diverse student population makes Baltimore educators open to new and innovative classroom technology, making the city an ideal testing ground for emerging ed-tech companies.
Richard is the CEO of Florida-based company, Epic SEO. He has several years’ worth of SEO and internet marketing experience helping small to mid-sized business owners grow their respective businesses.