Starting a new business in one of these large cities might be best

Many small-business owners are still struggling to hire new employees and make a go of their endeavors in this economy. But a new survey on 2023’s Best Large Cities to Start a Business could help.

To help aspiring entrepreneurs maximize their chances for long-term prosperity, WalletHub compared 100 U.S. cities across 19 key indicators of startup viability. The data set ranges from the five-year business-survival rate to labor costs to office space affordability.

Best vs. Worst

• Toledo, Ohio, has the lowest average annual rent for office space, $11.93 per square foot, which is 6.7 times cheaper than San Francisco, the city with the highest at $80.22 per square foot.
• Cleveland has the lowest labor costs (median annual income), $33,678, which is 4.6 times lower than Fremont, California, the city with the highest at $153,475.
• Laredo, Texas, has the lowest cost-of-living index, 80.00, which is 2.3 times lower than Honolulu, the city with the highest at 184.00.
• Miami and Hialeah, Florida, have the most startups per 100,000 residents, 254.62, which is 3.7 times more than Toledo, Ohio, the city with the fewest at 67.92.

Tips for Aspiring Entrepreneurs

“Do your homework/research. Make sure that your business idea meets needs, and that you do not lose sight of reality. An idea alone does not mean that it is automatically an opportunity in the marketplace. Have a plan to provide or obtain funding. For most ideas, find a way to generate sales if you want to be attractive to potential investors. Align yourself with people who complement your skills, and can help you,” said Michael Omansky, associate professor, at Felician University.

“Be Brave and be objective. If you cannot be open to advice and suggestions you may overlook a valuable piece of advice and it could mean success or failure. Do not be afraid to be different, have confidence. Courage is one of the most exciting things I find working with young entrepreneurs, they channel their enthusiasm. They see opportunities and not obstacles. With that in mind, do not be afraid of failure – most successful entrepreneurs failed (or learned) along the way and ultimately achieved their dreams. Look for resources in your area. There are so many things available to entrepreneurs that many are not aware of from local to national resources. Take time to seek out the resources. We do our best to make sure that entrepreneurial students who leave High Point University are fully aware of what is available beyond college life. We send them out with a solid foundation so they can become valuable to their communities when they graduate,” said Kathryn Elliott, professor; director of the Center of Entrepreneurship, at High Point University.

More than Technology

“We’ve seen the most disruption in food service over the last couple of years. Many of the changes were catalyzed by the pandemic but became consumer expectations. Online ordering, contactless delivery, and mobile payment quickly moved from novelty to expectation. Now, we see restaurants utilizing robots to assist human servers or deliver orders to local communities. Some restaurants have started replacing chefs and cook staff with robots as well. With staffing shortages hitting food service especially hard, we expect to see more of a shift to restaurants minimizing their reliance on humans. Entrepreneurs developing affordable solutions to minimize staffing needs could have a large market shortly,” said Jason DeBode, Ph.D., associate professor, Missouri State University in collaboration with Lance Coffman, regional small business consultant, Missouri State University.

“Anything that makes life better, easier, and faster for consumers – from food delivery to consumer goods to online services to education,” Omansky said.

Advantages and Disadvantages  of  Large City

“The advantages of a city are that there are often lots of other entrepreneurs working and living there. You can benefit from sharing ideas with them. Moreover, there are often more sources of venture funding in big cities. The disadvantage is that you cannot simply test your ideas in those big cities. If you intend to sell your product everywhere, you need to get out to other places that often have very different values, beliefs, and lifestyles than in those big cities,” said Michael A. Roberto, professor, Bryant University

“The advantages would include the availability of vast resources. The drawback would be competition for those resources. Once something becomes the next cool thing, it tends to attract more competition for those resources. On the resource side – they should not be the ‘best kept’ secrets but should be easy to find and use. In the end, there is great benefit for any community that embraces these entrepreneurial companies. They tend to be loyal to their hometowns and have a great spirit of giving back. One thing that naturally causes differentiation is the cost of living. Larger cities can make taking the chance of starting a new venture financially riskier. In smaller or mid-size communities, such as High Point, North Carolina, there is a closely knit supportive infrastructure that is ready and eager to support entrepreneurial success, ” Elliott added.

To view the full report and your city’s rank, please visit here.

Source: WalletHub