Several North Texas cities, including Farmers Branch and Greenville, were ranked among the top 25% of small cities to start a business, according to a new WalletHub study. The study analyzed cities across the U.S. with populations between 25,000 to 100,000.
The WalletHub 2022 Best and Worst Small Cities to Start a Business study ranked Farmers Branch at No.102 and Greenville at No.275 out of 1,334 small cities nationwide.
“Some factors that kept them from ranking higher include industry variety, investor accessibility, human resource availability, and workforce educational attainment,” said Jill Gonzalez, an analyst with WalletHub.
In comparison, five of the top ten cities are in Utah.
“Texas should work to lower business costs and increase access to resources in order to catch up with Utah,” Gonzalez told The Dallas Express. “Farmers Branch and Greenville have high business costs. For example, office space is not very affordable, and labor costs and corporate taxes are fairly high.”
According to Gonzalez, one of the reasons Utah is attractive to small business owners is because the state has shorter commutes, lower corporate taxes, and a high level of growth observed in small businesses.
“They have short commutes — about 15 minutes long — significant growth in the number of small businesses — as high as almost 34% in Washington and St. George — and a lot of startups per capita — close to 300 in the top two cities,” she added.
The findings are based on data from businesses registered in each city. According to the WalletHub study, the ideal business environment for small business owners would include easily accessible financial and human capital resources and low operating costs.
“Farmers Branch and Greenville are among the best small cities to start a business because they have long work weeks, high average revenue per business, and significant growth of business revenues — as high as almost 110% in Farmers Branch,” Gonzalez said in an interview. “The two cities also registered a lot of growth in the working-age population and the number of jobs.”
The report also found that Waxahachie, a southern suburb of Dallas, and Hurst also landed in the top 25% at No.306 and 312, respectively. A lower cost of living in these two cities makes them attractive to Texans wanting to launch a small business.
“The two cities also ranked high due to their over-40-hour workweeks, their almost 15% growth in the number of small businesses, and the high number of startups per capita — over 150,” Gonzalez said. “They also have financing accessibility, investor access, and human resource availability.”
The data further shows that the North Texas enclaves of Sherman, Haltom City, Lancaster, Weatherford, The Colony, Cleburne, and Grapevine placed in the top 50% of the list.
“The main things these cities have in common that contributed to their ranking in the top half are long work weeks and financing accessibility,” Gonzalez told The Dallas Express.
Finally, the study placed Cupertino, California, last on the list, partly because it has some of the highest business costs in the country and a less than 4% growth rate in the number of jobs.
“Cupertino has a long average commute time — almost half an hour — a small average revenue per business, and it ranked low for industry variety,” Gonzalez added. “The city also lacks financing accessibility and human resource availability.”