Many people prefer to visit or live in small towns instead of big cities. Why? In most cases, it’s because small towns are known for their uniquely charming collection of small businesses. Their products, workers, and atmosphere reflect the town’s personality. After all, these businesses wouldn’t be so successful if they didn’t suit the preferences of local residents. Business ideas for small towns present the advantage of catering to a niche market, as well as numerous challenges. Your target audience is limited to the town’s population, and the rising demand you’re meeting could turn to be a passing trend. Then there’s the crucial matter of location. The best spots are often the most expensive, so your operational funding must account for periodic increases in rent, utilities, etc.
Small Town Business Ideas: Which One Should You Start?
For a multitude of reasons, seemingly successful businesses in small towns are suddenly forced to close their doors all the time. Those that manage to stay open, however, can always rely on their permanent place in their customers’ hearts. All aspiring brick-and-mortar business owners must conduct extensive research to ascertain the likelihood of joining the latter group.
Factors like the size of your market, local regulations, and of course, expenses, will ultimately determine if your desired business is worth pursuing. If you’re not sure what kind of business to start, we’ve compiled a list of 15 historically successful small town business ideas. Regardless of age or geographic region, the following businesses are needed in just about every community:
15 Small Town Business Ideas
The business idea that you choose will most likely fulfill three qualities: profitability, sizable market, and alignment with your personal passions or goals. Here are a few ideas that are statistically more likely to fulfill the first two:
Restaurants are among the riskiest businesses to start. But more risk equals more reward. So, if you have the resources required for the right location and the right menu for your town, you could be financially set for life.
The key is to give your neighbors what they’ve always wanted but can’t find in their immediate vicinity. In other words, your idea must be both highly original and undeniably logical. “I can’t believe no one else has thought of this!” should be a common reaction from people passing by.
Maybe your neighbors are craving the upscale experience they can only find in the city. Maybe they have an affinity for cuisine from another part of the country, like New York, Louisiana, or California. Consider the kind of restaurants you search for when you leave your home town, and see if your neighbors like to explore similar options.
But before deciding on an idea, it’s imperative that you factor in one of the largest obstacles for restaurants: seasonality. Certain types of restaurants experience a massive drop in revenue during their slow season. The safest options are busy all year round. And few business owners are busier than restaurateurs. Most of them spend more time at their businesses than with their family or friends.
2. Coffee Shop
You’d be amazed by how many small towns still don’t have trendy coffee shops. In addition to the quality of the products, people love coffee shops because of their atmosphere and complementary offerings, like pastries or healthier snacks. Your customers must have a reason to choose your business over Starbucks, Dunkin’ Donuts, etc. Many independent coffee shops compete with franchises by creating an environment that is so comforting that people don’t want to leave.
Like restaurants, location plays a major role in the success of coffee shops. They must be situated near other businesses to maximize foot traffic, as well as near or on busy roads so customers can stop on their way to work. The goal of every coffee shop is to have customers coming in from dawn until dusk.
3. Liquor Store
If your grocery store is your town’s main source of alcohol, the local liquor market may be up for grabs. Alcohol is considered one of the few “recession-proof” industries because people buy liquor no matter what shape the economy is in. The challenge of starting such a lucrative business is staying compliant with local regulations and taxes. You’ll need to secure substantial documentation, including the notoriously expensive liquor license. This is one business where it pays to follow a guide as you acquire the necessary resources for launching operations.
4. Handyman or Tradesman
Young adults are often advised to look to the future when choosing career paths. What kind of workers will be in higher demand throughout the coming years? Well, you can’t deny that technology has made much of the world less comfortable fixing things around the house themselves. If there’s one profession that will undoubtedly be in higher demand in the future, it’s handymen and tradesmen.
Anyone who knows a good local handyman will tell you the incredible peace of mind it brings. You don’t have to worry about what you’ll do when pieces of your house start to deteriorate, and you know your friend won’t overcharge you. As you can see, becoming the go-to handyman in your town can make you very popular very quickly. And since you’ll get new business primarily from word of mouth, you don’t have to spend an arm and a leg marketing yourself.
5. Automotive Repairs
Auto shops are the quintessential small town business. Unfortunately, this industry has a reputation for overcharging new customers and taking advantage of their unfamiliarity with automotive systems. That’s why so many people stick with the same auto shop for their entire lives. Once you find a local shop you can trust, why risk going anywhere else?
Also, small towns are usually far away from dealerships or big cities, and no one wants to drive too far to get their car serviced.
6. Home Cleaning
Lots of people (especially young adults) despise cleaning but don’t know anyone willing to do it for them. Thus, the discovery of an affordable and trustworthy home cleaning service would likely trigger an abundance of word of mouth referrals.
This is a fabulous business idea if your town has a high young adult population and you know how to take advantage of a very low overhead. Aside from cleaning supplies and a company vehicle, there’s little expenses involved. Once you start taking on larger jobs, however, you will accrue more expenses and need to hire a team.
7. IT and Computer Services
The “peace of mind” concept mentioned in the handyman section can certainly be applied to IT services as well. Wouldn’t it be great if you didn’t have to call Apple tech support every time your laptop malfunctioned?
It’s safe to assume that virtually every town has a need for IT services, particularly those with high middle age populations. But since you won’t have a physical storefront, you’ll need to put considerable effort into advertising. At the very minimum, see if you can place business cards, flyers, or other materials at other local businesses. You’ll have minimal operational expenses, so you should capitalize on various forms of local advertising and word your ads very carefully.
On the other hand, you might find that a great deal of local business owners could use some help implementing new technology required for their industries. So, instead of catering to individual customers, you could focus on critical services for small businesses. This might include improving their websites, launching Ecommerce services, installing software tools, and of course, troubleshooting when unforeseen problems arise.
8. Pet-Related Business
Lots of small towns have massive populations of pet owners. But before opening your own pet-related business, you must make sure that these pet owners don’t already have a go-to resource for the products or services you plan on offering. Talking to local pet owners will connect you with owners of existing pet-related businesses, who can then tell you which products or services their customers are looking for. Examples include grooming, dog walking, or pet sitting.
Demand for pet sitting has increased dramatically, since more pet owners are realizing how stressful it is to leave their furry friends home alone all day. When you aren’t feeding, walking, training, and cleaning up after pets, you’ll be spending your day just hanging around your customers’ houses. For this reason, many pet sitters use this opportunity to do other work. This is a great way to essentially make money from two jobs at the same time. Combining pet sitting and another source of income will also keep your overall stress level low. Rather than pouring yourself over one source of income, you can devote a similarly moderate amount of energy to both jobs.
9. Tutoring Business
Despite tremendous advancements in educational technology, there will always be children who need additional help with their studies. Tutoring can be a fulfilling and practical option for aspiring entrepreneurs who are passionate about literature, science or math. Very few other entrepreneurial ventures are directly related to these subjects. You’ll finally be able to put all those academic awards you won to good use.
The key to success with tutoring businesses is building relationships with local parents. Gaining the trust of the right parent could grant you access to an entire network of other parents with similar needs. But this can only happen if your first students achieve their goals. Tutors must be careful not to take on enough work to compromise the quality of their services. You should also be sure to choose the right age level (elementary, middle school, or high school) for your teaching style. And since your target customers are parents, it’s extremely advantageous to have an understanding of both traditional and digital marketing tactics (social media, Google AdWords, etc.).
10. Ice Cream Shop
Ice cream and frozen yogurt shops are a cheaper alternative to full-service restaurants. And they tend to do incredibly well in small towns with lots of families and summer-related attractions. You just have to prepare for at least two obstacles. First is the unavoidable dip in revenue during the summer. Secondly, you’ll most likely have to expand your offerings to maintain relevance. New ice cream shops will naturally attract curious customers but keeping them all throughout the year is not easy.
11. Flower Shop
Like alcohol, some small towns get their flowers primarily from grocery stores. There may be a flower shop in the next town over but the grocery store’s location makes it the top choice. If you can find a similarly convenient location and have the resources to compete with the grocery store’s selection, a flower shop may be the perfect small business idea.
These resources, however, do not necessarily have to include money. Flower shops typically don’t require expensive equipment, large teams of employees, or long working hours. What they do require is the ability to serve multiple needs. In addition to holidays and events, you may find that a great deal of your customers are just looking for a place to pick up a rose or two on the way home from work.
12. Clothing Boutique
The dominance of online shopping can never eliminate the need for clothing boutiques that capture the spirit of small towns. These businesses do exceptionally well in seasonal towns or any town with its own unique attractions. Your designs will be based on whatever makes your town special. The combination of unique designs and the fact that your products are locally made will help you stand out.
There’s also plenty of room for expansion. Residents of small towns love bumper stickers and decorations that proclaim their pride for their home. If no one has snatched up this niche as of yet, someone will almost certainly do so in the near future. Regardless of their other preferences, anyone who has lived in the same town for many years has a connection to that town and is proud to show it.
13. Brewery or Winery
Local breweries or wineries are often inspired by the same goals as clothing boutiques. They give residents a locally-made product that they can proudly show off to their friends. The products are shaped after the town’s personality, and their originality makes them desirable for all walks of life.
Another reason you’ve probably noticed an increase in local breweries and wineries is the challenge that comes with starting and maintaining them. Compared to other small town business ideas, breweries and wineries require significantly more research, marketing, and equipment. Developing new products can be fun, but the resources required for storing and producing them in mass quantities might not be so easy to come by. And let’s not forget the need for ample space and a lively ambiance. The most successful breweries and wineries tend to have large outdoor areas complete with games like corn hole or Jenga.
14. Massage Therapist
Talk about a growing industry! More and more people are realizing that massage therapy is not a luxury but a necessity for balancing a successful career and active personal life these days. It is now completely understandable to get a massage every week, especially if you wish to stay equally productive all throughout the year. Today’s young adults associate happiness with getting things done, and there’s no limit to how much you can accomplish when you are mentally and physically relaxed.
Local residents would likely get massages a lot more often if this vital service was just a short drive or quick phone call away. Thus, you must figure out whether it makes more sense to create a physical storefront or to visit your customers’ homes. Either way, you should be prepared to work long hours early on. New massage studios usually attract customers through special offers, like an extra ten minutes on top of their scheduled session. And since your customers probably enjoy other forms of wellness therapy (cupping therapy, crystal therapy, etc.), you might consider obtaining the required certifications for offering additional services.
15. Food Truck
Let’s say you’ve discovered a specific food-related niche that hasn’t been filled by any other restaurants in your town. The only problem is that this niche isn’t big enough to support a full-service restaurant. A logical solution to this extremely common dilemma is starting your own food truck. Food trucks have recently become a staple of beach towns, though they can also do very well in busy corporate complexes. You’ll almost certainly have to serve multiple locations in order to stabilize cash flow during the colder months.
For example, you can gain traction at public events like community fairs and farmer’s markets before moving on to private events like graduation parties. It’s important to remember that some locations and events might require different licenses and permits. You should also secure an appropriate point-of-sale system (Square, PayPal, etc.) to compete with cash-only trucks.
Small Town Business Ideas: Making Your Decision
As you can see, most small town business ideas require extensive research on your local community. If you want to start a local business, get ready to talk to a lot of people, especially fellow business owners. You’ll want to uncover as much information as possible in relation to consumer needs and available opportunities. The ideal goal is to create a business that is just as necessary as it is original. Mysteries like this can only be solved through research.
This includes studying potential locations. Every town has seen new businesses open up in seemingly perfect locations, only to close their doors within the year. Why did this happen? Would this business have met the same fate in another location nearby? Location has likely played a major role in the survival of your town’s oldest businesses. Think about why this particular type of business has done so well in this particular location.
Your research will be complete when you have a thorough understanding of your local economy. You’ll know the most common struggles of local businesses and how the most successful businesses have conquered them. You’ll know which business ideas are the safest and which ideas can offer the greatest rewards. Every small town has its own circumstances, so it’s up to you to determine if your desired location, business model, and level of demand are truly capable of passing the test.