Business in Arkansas: Challenges and Opportunities

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If you’re searching for a profitable location to start your business, Arkansas presents unique opportunities for budding entrepreneurs. However, like any other state, there are some challenges to consider before setting up shop. You should determine which ones you’re willing to handle and if the positives are worth the risk. So, this article will go over some of the obstacles and opportunities companies in Arkansas face, some business ideas, and costs to consider.

Competition

Several well-known companies are headquartered in Arkansas, such as Walmart, Dillards, and Tyson Foods. So if you want to open a large franchise, this is the place to start. However, little mom-and-pop shops won’t have an issue with success as long as they can stand out against the competition. There are many well-loved small businesses in the state, and you’ll need to market yourself effectively to be seen. And while building a loyal customer base in a small town can be tricky in the first year, establishing trust is vital. You’ll need to contribute to the local community to show people you care about them.

Location

Arkansas is conveniently located between major US cities like St. Louis, Memphis, and Dallas. In addition, the state is known for its natural beauty, so people travel here from urban areas to wind down, hike, camp, and, of course, shop! So if you position your place of business in areas with heavy local and tourist traffic, you’ll scale quickly.

However, Arkansas is also a largely rural state with severe poverty levels. So if you set up shop in the wrong spot, you’re not likely to see much foot traffic. But if you want to locate yourself in a rural area, consider business ideas that cater to small towns, over-the-road truckers, or people looking for quality products at an affordable price.

Taxes

One of the most significant positives of opening a business in Arkansas is the tax incentives. The state government may offer tax credits, grants, and cashback programs for people who create full-time jobs, provide childcare, or purchase construction materials for infrastructure. This is just one reason people start their businesses here. However, all companies operating in Arkansas must pay a franchise tax every year, which is a minimum of $150. Furthermore, you must pay it regardless of whether you made profits in that year.

Affordability

Arkansas is known for being one of the cheapest places to live in the US in terms of affordability. So you will have a bit more wiggle room financially if you choose to start your business here. But if you struggle with money management, you should consider hiring an accountant to help you with budgeting and taxes.

Don’t Forget about These Business Costs

On top of filing an annual report for the franchise tax, there are some other administrative costs you’ll need to consider. For example, if you’re selling physical products, there are supply, transportation, payment processing system, and insurance costs. Workers’ compensation is necessary to keep your business up and running in the event of an accident on site. Luckily, Arkansas workers comp online is pretty affordable and easy to set up.

Business Ideas

If you’re an entrepreneur but don’t know what to sell, you’re not the only one. You may have many passions to choose from, or you could be struggling to find inspiration. So here are some of the most popular and lucrative business ideas for the state of Arkansas. Hopefully, at least one of them attracts you.

Trucking Company

Arkansas has extensive roadways. So an over-the-road trucking company is the perfect business endeavor for people in rural areas since you won’t depend on the local economy by booking loads with brokers outside the state. Plus, trucking companies will always be in demand since they keep our grocery stores stocked up. Therefore, you’ll never find yourself short on work.

Restaurant

If you set up shop in Little Rock or any other area heavily populated with tourists, a restaurant could be great for you. To stand out against the crowd, you have to give your customers a unique experience that they can’t find anywhere else. Doing so will establish your business and help you grow a loyal customer base from locals during off-seasons.

General Store

Suppose you’re looking for a way to meet the basic needs of the community surrounding you. A general store can be highly profitable if you offer quality products at affordable prices. Plus, if one shop does well, you can open a chain of stores around the state or country.

Conclusion

Whether you want to open a small business or a large franchise, Arkansas is the perfect place to start. You’re bound to be successful with the tax benefits, affordability, and convenient location. The main challenges are standing out, finding the ideal place to set up shop, and surviving the first year of business. As an entrepreneur, you’ll need to be prepared for any obstacles that could affect your company so you can navigate them with ease as you scale.

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