Business ideas for a small town or province are often overlooked, but smaller locales offer unique opportunities to create innovative and profitable enterprises. Whether it’s capitalizing on locally sourced produce by creating markets, offering eco-friendly products or services that cater to locals, or creating a craft brewery to complement the community’s cravings for something new, these business ideas can lead to success. Business owners in smaller towns can also find benefit in teaming up with neighboring independent businesses, allowing them to combine resources and perhaps even become competitive in larger areas. Small towns may not have the same opportunities as major cities, but they are capable of still having a big impact – all it needs is the right combination of creativity and ambition.
How To Choose An Idea For A Small Town?
The word “business” often conjures up a certain image: a solid man in a business suit walking out of the office of an international corporation. The office is necessarily located somewhere in a skyscraper in the center of the metropolis.
But we all know that businessmen can look like anything, and business has its place not only in cities with millions of people, but also in small towns. And you can run your own business in a district center just as successfully as in Moscow.
You only have to take into account some of the peculiarities of small towns. If you are just going to open your own business in one of such settlements and are looking for a business idea for it, this article is for you.
A Little Bit About Small Towns
When starting a business in a small town, it’s important to consider its peculiarities. As a rule, they are about the same whether it is a resort town in the south or a small northern settlement.
On what to consider a small town, there is no consensus. As a rule, small towns are those where the population does not exceed 50 thousand people. But businessmen often call towns with a population of 500 thousand people small.
The main thing that allows us to classify towns as small is the state and peculiarities of the economy. What are they?
The first thing worth looking at is the well-being of the population. Small towns tend to have few jobs, and often a large percentage of residents work for a single city-forming enterprise. This allows business owners to set small wages. That is why incomes in such towns are often low. Although, of course, there are exceptions to this rule.
The second important factor is the mentality of the inhabitants of the city.
In tourist areas business can be done geared towards visitors, although in this case you will have to put up with its seasonality. But in cities where the influx of tourists does not suffer, extravagant institutions are better not to open.
Another peculiarity of small towns is the labor market. As mentioned above, it is usually quite poorly developed. At the same time, it is very difficult to find highly qualified specialists as professionals in very narrow industries in a small town. That is why an enterprise that requires a large number of rare and valuable personnel should not be opened in a small town.
Also in small towns there may be such a phenomenon as a shortage of basic goods. For example, popular brands of inexpensive clothing are not represented, or there is only one supermarket with budget products for the entire city. So it is in a small town that it may be a good idea to open another clothing store or another grocery store.
And of course, you can not write off another feature of a small town – everyone knows everything about everyone, and rumors travel at the speed of light. Including the institutions. On the one hand, this can help businesses save on advertising: all the work will do “word of mouth. On the other hand – if you do not manage to “show class” immediately after opening a business, you run the risk of never winning your customers.
All of these characteristics of small towns have an impact on the development of business in them. It is both positive and negative. Let’s take a closer look at the pros and cons of doing business in a small town.
Peculiarities Of Small Town Business
Perhaps we should start with the pitfalls of running a small town business. Let’s talk about the downsides:
Small Income
Since your potential customers do not earn much money and are willing to spend money accordingly, you should not expect to make a million-dollar profits. Assess the situation soberly.
Limited Growth Opportunities
If in a megapolis you have almost no limits for the growth of your business, provided the idea for it is chosen correctly, in a small town things are different. The number of your customers will increase only up to a certain point, after which growth in demand will stop. This point should be considered in advance and built into your business opportunities for scaling. When new customers cease to appear, it is worth trying to open a branch office in the suburbs or take up the development of any related business. You can also try to invest in a completely new project, if in the course of work you see that there are more promising niches. And here the emphasis on increasing the average check is not always worth it. Remember: residents’ incomes are often low.
Narrow Market
In a small town there are not many opportunities to implement some extraordinary ideas. They can be simply unclaimed. However, for standard establishments, the capacity of the market is also limited. In Moscow and St. Petersburg, you can safely open another pizzeria, even if you already have a hundred of exactly the same. In a small town the next institution may not find customers.
However, the peculiarities of small towns offer some advantages to aspiring businessmen:
Low Market Entry Threshold
It will cost you less to start a business in a small town than in a metropolis. Rental rates for commercial real estate in the provinces are lower than in million-dollar cities, as are staff salaries. Thanks to these points, the regular costs of your business will also be lower.
Favorable competitive environment
Small businesses in small towns are generally underdeveloped, and you are unlikely to have many competitors. In addition, many potentially desirable business niches turn out to be completely empty. That said, finding those niches will not be difficult, says co-owner of the online trucking service Ivan Plastun: “In a small town it is much easier, because all the companies and outlets can bypass on their own.
Support
This feature is somewhat related to the previous point. Since private business in small towns is underdeveloped, the authorities willingly make efforts to change the situation. There are support programs for entrepreneurs, e.g. grants or subsidies, and special institutions to help start a business – business incubators, business gas pedals. It is true that entrepreneurs have mixed feelings about them.
Olga Kossets from the organization “Business People” advises to study support programs and to get acquainted with employees of profile departments:
Olga Kossets of the Business People organization advises studying support programs and getting to know the employees of the relevant departments in person: “It is their direct responsibility to point you in the right direction.
Anatoly Churgel of the Russian National Committee for Black Sea Economic Cooperation, on the other hand, cautions: “You shouldn’t ask local structures for advice – they will grab ideas on the fly”.
In his opinion, it is better to start not with a large-scale business project, but with something that requires a small investment. Subsequently they can be multiplied, and at the same time you can gain business experience and look at the problems of entrepreneurs from within. You can also turn to the experience of your acquaintances: who among them has resorted to the help of the local authorities in opening a business? What was the result?
In the case of business in small towns, there are also several points of contention that can be turned both to your advantage and to your detriment.
This is first and foremost the “word of mouth” mentioned above. Word of mouth can both help you save money on advertising and kill your business at the root, especially if there were some shortcomings at the start of the business.
In addition, the number of consumers in a small town is limited, which on the one hand “cuts” your options. On the other hand, when there are few customers, they are all in sight, and to study their preferences is much easier than in the metropolis.
How To Choose A Business Idea For A Small Town?
Once you are familiar with the characteristics of small towns and entrepreneurship in them, choosing your business idea will be much easier. However, the criteria for choosing a business idea for a small town are absolutely the same as for a large town, insists Ivan Plastun, co-founder of the service “Lucky for Everyone”. In both cases it must have a certain novelty. This does not mean that your business should offer something that no one has heard of before. On the contrary, it must be understandable to consumers. But you should not copy other people’s business ideas completely.
If your competitor has already opened “Tire fitting shop on Vishneviy”, do not open another, advises Olga Kosets. It is better to complement it with a “sink” or a small cafe, or you can do both. It is likely that this format will later grow, and in the symbiosis you are more crisis-resistant, and you have a better chance of survival and success.
Another criterion for a successful business idea for both small and large cities – its relevance to a wide range of potential customers. Ideally, your business should solve some mass problem that plagues the majority of the city’s residents.
But what that problem is, in each case to decide individually. There is no universal answer for the average small town.
Before you start looking for a business idea, look around. Perhaps you will immediately see that your town lacks, for example, inexpensive entertainment facilities.
Take a closer look at the potential customers. It should not be a narrow group of people, but the vast majority of the city. Who are these people? What interests do they have? What do they need?
If you have noticed some need of the population, on the satisfaction of which you can do business, conduct a benchmarking*.
In a small town, it makes sense to think about a business based on some mass-market goods. Grocery, hardware, construction, clothing stores, small vegetable stalls, farm stalls, mobile shops with a set of basic necessities may be in demand.
The same applies to the service market. In small towns may be in demand standard options such as laundries, dry cleaners, ateliers, shoe and clothing repair, car repair shops.
In looking for a business idea, try to push from the peculiarities of the labor market. Not enough highly skilled lawyers or programmers? Give up the idea of launching your own website or opening a legal services agency. Instead, try to focus on what people know how to do with their hands, such as fixing phones, computers, motorcycles or cars. If there is enough manpower with such competence, open a service center or service stations. Such a business may also be in demand in a small town.
Your business idea can be quite simple, and have some “chips. For example, if you are thinking about opening a store with farm products, try to develop an online store and arrange delivery. This will immediately distinguish you from the competition, but at the same time will give you additional opportunities to scale the business, which is so necessary in a small town.
If you decide to open a business in a small tourist town, you can also turn this to your advantage. Look at the cozy private shops, workshops and family businesses of old Europe. You can open something similar in your own town, making your small business a local attraction.
Another good move for a tourist destination is to pay attention to local traditions and crafts. It is not necessary to open another store with souvenirs. Try organizing traditional entertainments, such as falconry or fishing tourism, Anatoly Churgel advises.
So, small towns have a certain specificity, which affects the conditions for doing business in them. Not every institution can be opened in a small town. Choosing a business idea in a small town takes into account the economy, the living conditions of the population and its mentality. Do not open a luxury clothing store in a mining town, and in a military town – a cheese-eating cafe. You simply will not find customers, and your establishment risks closing quickly.
Conclusion of the Business Ideas for Small Towns Review
Business Ideas for Small Towns is a commendable book that offers its readers creative and innovative ideas to start their business journey in rural areas. The content is relevant and well researched. However, the book fails to address some common problems faced by small businesses in such areas. Overall, Business Ideas for Small Towns is a decent read with some good insights. If you are looking for similar books, make sure to check out our website where we review many business-related titles.
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