5 Cities Opening Their Doors to Small Business

Date: July 01, 2014

Location matters. These areas are attracting small businesses with their friendly tax rates, regulatory landscapes and resources.

Thinking local matters. The city in which you operate your business determines your taxes, the resources available, and in many cases, your customer base—not to mention your business’ longevity.  

These five U.S. cities are opening their doors to entrepreneurs and helping them succeed and grow their businesses. Read on to find out what makes each location a winner.

1. Casper, Wyoming

Population: 58,000

Unemployment Rate: 4.1%

Top Industries: Oil and Gas Development

Small Business Opportunities: Casper’s economy has been largely built on agriculture and the oil and gas industry—in the early 1920s, it earned the nickname “Oil City” because the area produced more oil than anywhere else in the world at the time. But it’s today’s oil boom, which began in 2004 and is projected to continue through at least the next decade, that matters now. Statewide, Wyoming oil production has increased from around 146,000 barrels in 2008 to almost 3 million barrels in 2013, according to the Wyoming Oil and Gas Conservation Commission.

The oil and gas development industry may be the area’s economic backbone, but the city’s growing population is fueling a demand for more service businesses. “Casper is a great place for small businesses to bloom, as our city is growing as well,” says Melanie Bradford, owner of Keefe’s Flowers, which has operated in the city for more than 100 years. The U.S. Census Bureau ranked Casper as the sixth fastest growing metropolitan area between July 2012 and July 2013, out of 381 cities.

“When you have two [dominant] industries like [energy and agriculture], they create a lot of subsidiary jobs,” says Tony Gagliardi, NFIB’s Wyoming state director. As a result, the city has a diverse workforce and opportunities for skills training, such as workshops at Casper College’s Center for Training and Development or programs at the Casper Workforce Center.

VIDEO: Hear more from Gagliardi on why Capser is small business friendly.

Reasons Casper Makes the List: Local businesses benefit from Wyoming’s low taxes—there are no corporate or personal income taxes.

Casper’s hands-off regulatory environment also makes it a good place for businesses to grow. For instance, oil production companies can build roads and locate wells where they need without waiting for local or state-level environmental approval.

NFIB works hard to ensure state lawmakers prioritize small business. “When the Legislature is in session, I sit down regularly with individual legislators to make sure that no policies are passed that make it harder to own, operate or grow a business,” Gagliardi says.

In the most recent legislative session, NFIB fought three bills that would have subjected small businesses to more audits and higher fines and penalties if they misclassified an employee as an independent contractor. Now, it’s combating government attempts to mandate certain employee benefit programs such as higher minimum wage and paid sick leave.

“The Wyoming Legislature is very aware of the impediments these mandates can have on business,” Gagliardi says. “We are committed to making sure Wyoming legislators understand that business operates best when left alone by the government.”

RELATED: How to Start a Business in Casper, Wyoming

2. Jackson, Mississippi

Population: 175,000

Unemployment Rate: 6.3%

Top Industries: Banking, Manufacturing

Small Business Opportunities: Two decades ago, Mississippi’s capital wouldn’t have made this list. During the 1980s, Jackson’s population rapidly decreased due to urban flight. But the city has rebuilt itself and undergone an economic revitalization, says NFIB State Director Ron Aldridge.

The renaissance began after Nissan Motor Co. opened a $930 million plant in the Jackson area in 2003. Thousands of jobs for suppliers for Nissan soon followed, and the local economy received a major boost.

Since then, it has grown a significant economic base of government, healthcare and higher education institutions, providing a strong environment for new and growing businesses, says Aldridge. Jackson is especially seeing an increase in “young entrepreneurs and professionals who desire to work, employ, serve, buy local and play in the same area of the city where they live, and who are especially interested in promoting and creating jobs,” Aldridge says.

VIDEO: Hear more from Aldridge about why Jackson is small business friendly. 

For 16 years, NFIB member Jim McIntyre has owned and operated his business, A Complete Flag Source Inc., in Jackson. The company has installed flagpoles in eight states, so being located in Jackson has been ideal. “The city has been good to us,” McIntyre says.

Reasons Jackson Makes the List: Jackson ranks as one of the most affordable cities to do business in the country. In 2012, the Building Owners and Managers Association International named Jackson the city with the least expensive commercial real estate operating expenses in the United States. And the city is home to the Mississippi Development Authority’s new Entrepreneur Center, which provides “a one-stop shop for supporting every Mississippi entrepreneur in starting or growing their business,” Aldridge says. 

Jackson’s workforce is plentiful. According to the Greater Jackson Alliance, the Jackson metro area has a population of 780,000 and a workforce that is 400,000 strong. That includes a “hidden workforce” of approximately 205,000, which includes the underemployed, unemployed people who want to work, those working part time who want full-time employment, and recent college graduates. The region also is home to eight four-year colleges and three community colleges, with a total of approximately 6,000 graduates each year. 

3. Las Vegas, Nevada

Population: 596,000

Unemployment Rate: 8.7%

Top Industries: Tourism, Gaming, Construction

Small Business Opportunities: The private sector is stepping up to bring business opportunities to Vegas, says Randi Thompson, NFIB’s Nevada state director. For instance, Zappos’ founder Tony Hsieh is leading The Downtown Project, which has dedicated $350 million to rejuvenate a blighted stretch of Las Vegas’ downtown, investing in real estate, small businesses, education and tech startups.

VIDEO: Hear more from Thompson on why Las Vegas is small business friendly.

After experiencing the excellent care local hospice workers provided during her father’s illness, Lisa Wensley launched an in-home care franchise, ComForcare Senior Services, in her hometown of Las Vegas. “Las Vegas is a good location to open a small business because it is always growing and changing, which makes for a lot of opportunities for small businesses to thrive,” she says. “It is an innovative environment that supports small businesses, and we have seen that support within our business.”

In addition to sunny weather, affordable housing and plenty of round-the-clock fun, “there is a sense of community here, and that provides a lot of opportunities to collaborate with others who are driven by the same idea of community,” Thompson says.

The Downtown Project is a good example of that collaboration. Hsieh and other entrepreneurs and business owners have joined together to improve the downtown area without any public funding. So far the project has created 533 jobs through the development of new bars, retail stores, and other small businesses. The Downtown Project also offers loans to small businesses that launch in the area—one business, a restaurant called Eat, received a no-interest, $225,000 loan to get started downtown.

Reasons Las Vegas Makes the List: Statewide, there is no corporate income tax, no personal income tax, no estate tax, no franchise tax, no inventory tax, no tax on corporate shares, and property tax has an annual rate increase cap of 3 percent on residential homes and 8 percent on business property. Additionally, in an effort to redevelop underused areas of the city, Las Vegas will reimburse qualified applicants up to $50,000 toward the cost of rehabilitating older buildings to bring them up to current building and fire code standards.

RELATED: How to Start a Business in Las Vegas, Nevada

4. Orlando, Florida

Population: 250,000

Unemployment Rate: 6.0%

Top Industries: Tourism, Technology

Small Business Opportunities: When Ashley Cisneros Mejia and her co-founder launched digital marketing agency Chatter Buzz Media in 2012, they learned the ropes of business ownership by participating in the city of Orlando’s Entrepreneurs Academy, a two-day educational event for local entrepreneurs who apply. And during their first year in business, the city’s National Entrepreneur Center “was our second home,” Mejia says. “The center is home to resident organizations that provide counseling, programming and training to local entrepreneurs.”

Such organizations and opportunities help create Orlando’s “rich ecosystem for supporting startups,” Mejia says. Because the city “embraces natives and newcomers alike, it’s an ideal place for launching new businesses,” she adds.

Businesses in a variety of sectors find success in Orlando; among some of the most successful sectors are aviation and aerospace, film and television production, business services, clean technology and sustainable energy.

Orlando is home to a number of vibrant “Main Streets” that are attracting small businesses, Butler says. That small-town feel convinced Kostya Kimlat to establish the headquarters of Event Magic International, his national team of professional magicians, in his adopted hometown of Orlando. “Orlando has always known that it’s a small city growing up,” he says. “It has a small-town feel with large opportunities.” 

Why Orlando Makes the List: Florida Governor Rick Scott has shown his dedication to the small business community and helped make the state a better place for small business, says Kristen Butler, NFIB’s Florida communications director. Gov. Scott has focused on reducing state regulations on small business, such as a proposal to eliminate business taxes for companies with less than $75,000 in revenue, streamlining the permitting processes and capping the duplicative regulations that local governments place on small business owners. He also cut corporate income taxes for small business owners, “removing almost 4,000 businesses from the tax rolls,” Butler says.

RELATED: How to Start a Business in Orlando, Florida and My Small Business: Orlando Real Estate

5. Phoenix, Arizona

Population: 1.5 million

Unemployment Rate: 6.4%

Top Industries: Technology, Aerospace, Service Industries

Small Business Opportunities: NFIB member Mark Giebelhaus has owned and operated commercial plumbing company Marlin Mechanical Corporation for more than 31 years in Phoenix. Although his company was not untouched by the Great Recession, he says it has experienced a fast recovery during the past 18 months as commercial plumbing industry resurges.

For instance, in January 2013, Marlin Mechanical had 30 employees, and a year later, it has 150—the highest number of employees the company has ever had in 32 years. (Before the downturn, the company averaged roughly 80 employees.) While some sectors of the local economy are still waiting to recover, Giebelhaus says his plumbing company is in a unique position because the multi-unit market is experiencing a huge comeback.

Construction companies can also take on more projects due in part to a new law designed to make local government more efficient for small business owners. Two years ago, the Phoenix City Council implemented reforms that shifted a significant portion of city permitting and inspection functions to the private sector and created 24-hour turnarounds for projects such as city and building permits that used to take four to six months. With quicker turnarounds, doing business in Phoenix has become faster and more convenient, NFIB State Director Farrell Quinlan says.

VIDEO: Hear more from Quinlan on why Phoenix is small business friendly.

Why Phoenix Makes the List: Phoenix’s rebounding economy, favorable climate and entrepreneurial culture attracts many transplanted residents. “The majority of people starting small businesses and prospering here were born somewhere else,” Quinlan says. “That kind of ‘new blood’ and vitality means opportunities in Phoenix aren’t encumbered by an ‘old boys network.’” 

Although the Phoenix and Arizona economies were dependent on new home construction until the housing bubble burst in 2008, the area has made great strides in diversifying its economy to include more manufacturing and healthcare businesses “so we will never again be so exposed to a sector downturn,” Quinlan says.

Additionally, the state has been a leader in low tax rates and regulatory reform. “For instance, House Bill 2013 simplifies the process state agencies must follow when creating rules and regulations they impose on Arizona businesses. That leadership ensures government serves as a facilitator of economic dynamism rather than a frustrator of job creation,” Quinlan says.

RELATED: How to Start a Business in Phoenix, Arizona

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