Advantages of Doing Business in a Rural Area
22 May 2023
When it comes to doing business, countless factors come into play, from access to capital to workforce availability to market demand. However, one element that is often overlooked is the location of the business itself. While many entrepreneurs and investors flock to urban centers in search of opportunities, there are several compelling advantages to doing business in a rural area.
Lower Cost of Doing Business
One of the most apparent advantages of operating in a rural area is the lower cost of doing business. Rural real estate prices are often significantly lower than in urban or suburban areas, making it easier for businesses to purchase or lease property. Similarly, wages and salaries are often lower in rural areas due to the lower cost of living, which can help businesses keep labor costs under control. Additionally, taxes and other regulatory burdens may be lower in rural areas, which can further reduce the cost of doing business.
Access to Natural Resources
Another advantage of rural areas is access to natural resources. Many rural communities are rich in natural resources like timber, minerals, and agricultural land. This can be a boon for businesses that rely on these resources, such as manufacturing or agriculture. Additionally, rural areas may offer access to renewable energy sources like wind or solar power, a cost-effective alternative to traditional energy sources.
Lower Cost of Living
In addition to the lower cost of doing business, rural areas often offer a lower cost of living for residents. This can be a significant draw for both business owners and employees. Lower housing costs, utility bills, and transportation expenses can add significant savings for individuals and families. This can make it easier for businesses to attract and retain talent, as well as help entrepreneurs stretch their startup capital further.
Strong Sense of Community
One less tangible but equally important advantage of rural areas is the strong sense of community that often exists there. Rural communities tend to be more tight-knit and supportive than their urban counterparts. This can be a significant advantage for businesses that rely on local networks and relationships. Additionally, rural communities may be more receptive to new businesses and eager to support their growth and success.
Another advantage of doing business in a rural area is the lower competition. In many urban and suburban areas, businesses must compete with numerous other businesses offering similar products or services. There may be fewer competitors in rural areas, allowing businesses to carve out a niche and establish themselves more easily. Additionally, rural areas many offer access to underserved markets or customer segments that are overlooked by larger competitors.
Attractive Quality of Life
Finally, rural areas often offer an attractive quality of life that can be a significant draw for both businesses and employees. The slower pace of life, proximity to nature, and sense of community can all contribute to a higher quality of life for residents. This can be especially attractive for businesses that value work-life balance and want to attract employees who prioritize quality of life.
How Economic Developers Can Leverage These Advantages
So, how can economic developers leverage these advantages and attract new businesses to their communities? Here are a few strategies to consider:
Highlight the Cost Advantages
Make sure that businesses and entrepreneurs are aware of the lower cost of doing business, access to natural resources, and other cost advantages of operating in a rural area. Use case studies and data to demonstrate how businesses can save money by operating in your community.
Emphasize the Quality of Life
Make sure the businesses and employees are aware of the attractive quality of life that your community offers. Use social media, community events, and other outreach strategies to showcase the natural beauty, recreational opportunities, and strong sense of community your rural area offers. Consider partnering with local tourism agencies to promote the area as a great place to live and work.
Foster Local Networks
Use community events, business associations, and other networking opportunities to help businesses and entrepreneurs connect with each other and with local resources. Encourage businesses to collaborate and support each other, building a strong local network that can help attract and retain businesses over the long term.
Address Infrastructure Challenges
Rural areas may face challenges with infrastructure, such as limited access to broadband internet or transportation networks. Work with local and state government agencies to address these challenges and improve infrastructure in your community. This can help businesses operate more efficiently and attract new businesses that require reliable infrastructure.
Partner With Educational Institutions
Partnering with local educational institutions, such as community colleges or vocational schools, can help businesses access a skilled workforce and provide training opportunities for local residents. Encourage businesses to work with these institutions to develop apprenticeships, internships, and other programs that help build a strong local workforce.
Finally, economic developers can support entrepreneurs in rural areas by providing resources and support for startups and small businesses. This might include access to capital, business coaching and mentoring, or assistance with regulatory compliance. By fostering a culture of entrepreneurship and supporting startups, economic developers can help attract new businesses and create a thriving ecosystem of innovation in their communities.