8 Small-Town Business Ideas for Entrepreneurs

Turning a profit with a new business often hinges on its location. In the heart of America, small towns are bustling with opportunities for aspiring entrepreneurs. Let's explore some small-town business ideas and uncover why they might just be the key to entrepreneurial success.

A small town is typically characterized by its limited population size, offering a sense of community, and belonging that's harder to find in larger cities. According to the most recent U.S. Census Bureau data, small towns are the backbone of the country, with millions of Americans calling these close-knit communities home. At least 76% of the nation’s towns have less than 5,000 residents, and 42% of those have fewer than 500 people. Non-metro areas are experiencing an uptick as people exit big cities for a lower cost of living and better lifestyle. More than 1.1 million people abandoned urban life in 2022.

The charm of a small town, often characterized by a close-knit community and slower pace of life, provides fertile ground for businesses that cater to the specific needs and values of its residents. Getting a business started in a small town can be more affordable than in a metropolitan area, and there’s a chance you’ll face less competition.

At the same time, starting a business in a small town requires a deep understanding of the local market and community. Whether it's opening a local coffee shop, a fitness center, or a franchise, offering value, building relationships, and adapting to the dynamics of small-town America will set the stage for success.

Before you launch a small-town business, do your research to understand the market. Here are a few things to consider:

• Community demand: A successful small-town business solves a problem or fills a gap in the local market.
• Local competition: In small towns, the market might not support multiple businesses of the same type, so finding your niche is key.
• Community involvement: Small towns value businesses that contribute to the community. Engaging in local events and supporting local causes can build goodwill and brand loyalty.
• Affordability: A small business needs to pay close attention to the area’s economic climate and price its goods and services to appeal to most residents to be successful.
• Adaptability: When your customer base is limited, it’s important to be flexible. A small-town business needs to be able to pivot as the seasons change or the population fluctuates.

Best Business Types for Small Towns

If the nostalgia and community of small-town life sounds appealing, check out our small-town business ideas.

1. Restaurants: Small towns cherish gathering spots where community members can meet, socialize, and enjoy tasty food. A café or a local diner that offers a cozy ambiance and quality cuisine can quickly become a town staple.
2. Grocery or specialty food shops: A small town may not have easy access to a variety of foods found in cities. A local grocery store or a specialty food shop that offers organic, local, or gourmet products can do quite well.
3. Fitness centers: Promoting health and wellness has universal appeal. The number of Americans who were members of a gym jumped 3.7% in 2022 to 68.9 million, and the top three fitness activities were yoga, swimming, and high-intensity interval training, according to IHRSA’s 2023 U.S. Health & Fitness Consumer Report. A small fitness center or a wellness studio offering can cater to the growing interest in health and fitness.
4. Personal care services: Salons, spas, and barber shops are always in demand. At least 24% of women spend more than $100 when they visit the hair salon. Providing high-quality personal care services can help you tap into the town's routine grooming needs.
5. Childcare centers: For working parents in small towns, finding reliable childcare can be a challenge, and it’s costly. A report from USAFacts reveals childcare costs have increased 28% over the last decade, and the average American family spends at least 7% of their income on childcare. A well-run childcare center can provide an essential service to the community.
6. Automotive repair shops: In areas where public transportation is limited, the need for automotive repair services is constant. A trustworthy mechanic can build a loyal customer base quickly.
7. Realtor: A strong sense of community and personal connections can help fuel a small-town real estate business. The real estate market in a small town can also be less volatile, with more stable prices and demand. Small towns often have a limited number of real estate professionals, reducing competition and allowing a well-positioned realtor to capture a significant market share.
8. Handyman or contractor: With a sizable portion of small-town America living in older homes, there's a constant demand for home improvement and repair services. The median age of an American home is 39 years, according to the National Association of Realtors. Starting a business that offers these services can fill a crucial need in the community.

Why Franchising is a Smart Move

Franchising in a small town provides an entrepreneur with a turnkey business model, training, and ongoing support, which can be particularly beneficial in markets with limited business resources. With the backing of a recognized brand and a comprehensive support system, franchisees can navigate the challenges of small-town business ownership.

Bath Tune-Up, which specializes in bathroom remodeling, caters to the ongoing need for home maintenance and improvement, ensuring steady demand. Unlike a handyman service that might focus broadly on various remodeling services, we devote our efforts to bathroom renovations, offering a wide range of services from simple updates to complete overhauls. Our commitment to staying ahead of industry trends ensures that franchisees can offer the latest in bathroom design and technology, from eco-friendly materials to smart bathroom features, catering to the modern homeowner's desires and increasing the brand's appeal.

Our bath franchise’s affiliation with Home Franchise Concepts, a leader in the home services franchising industry, adds to its appeal. Home Franchise Concepts was on track to the company is projected to hit $1.5 billion in sales in 2023 and provides franchisees with a robust support structure. This includes extensive training programs, marketing support, and operational guidance, all designed to ensure franchise success from the start.

For an initial investment of $104,930 to $158,850, our franchisees benefit from the brand's established reputation, group buying power, and proven marketing strategies, significantly reducing the risks typically associated with starting a new business.

Follow Your Dreams with Bath Tune-Up

Inquire now to learn more about launching a bath remodeling franchise in your small town.