8 Expert-Recommended Business Ideas Perfect for Small Towns

What's a good business to start in a small town?

While most people don't think of small towns as places for lucrative businesses, there are ways to make them profitable while enjoying the slow-paced small-town lifestyle many of us have come to appreciate.

But what are these small-town business ideas? I asked business owners and professionals from various backgrounds for their take.

Small-town business ideas — before you get started

"Before you do anything else, learn about your community. Be more than just local; be hyper-local. Go to city council meetings, support local events, and learn what your town loves and what drives it crazy. Your neighbors aren't just the people who buy your stuff — they're your partners." - Dalya Harel, founder of Lice Busters.

Dalya Harel's advice emphasizes the importance of immersing yourself in the local community you plan to serve and start your own business in, whether a local grocery store, food truck, or ice cream shop.

In a small town, your business idea is closely tied to how well you understand and connect with the people around you.

(Successful local business owners understand that the perfect business idea for a small town is centered around this.)

Attending city council meetings, for instance, provides you with firsthand knowledge of local issues, concerns, and developments that might impact your business.

It also positions you as someone invested in the town's well-being, which can build trust and rapport with potential customers.

Supporting local events increases your visibility and allows you to interact with residents in a setting where they feel comfortable and engaged.

Whether sponsoring a youth sports team or participating in a local fair, these actions demonstrate your commitment to the community and help establish your business as a trusted and valued presence.

Understanding what your town loves and what drives it crazy is essential for tailoring your offerings and messaging.

1. Saini suggests starting a coffee shop: creating a community hub with every cup

"Everyone needs a morning cup of joe to get their day started. Even in a small town, cafes and small, locally owned businesses are the backbone of an economy. Starting a coffee shop can establish you as a third place where people can hang out, chat, work, and eat.

The best part is you can buy the land and hopefully grow your net worth if the land asset value rises." - Harpreet Saini, CEO of We Buy Houses in Metro Detroit.

Starting a coffee shop offers more than just a place to grab a coffee; it creates a social hub that becomes an integral part of the community.

In small towns, the idea of a "third place" — a location where people gather outside of home and work — is especially significant.

Establishing such a small town shop fosters connections and creates a welcoming environment that encourages repeat visits

(In short, it's a solid business idea!)

2. Yarber suggests starting a dog care business, tapping into a loyal market with pet services

"If I were starting a business in a small town today, I'd consider a dog grooming salon or daycare. Pet care is a growing industry, and in tight-knit towns, people become very loyal to businesses that treat their four-legged family members well.

Build a fun, memorable brand around high-quality, caring service. Offer discounts and promotions to first-time customers to get them in the door. With the right approach, a business like this could gain lifelong customers through word of mouth alone." - Joseph Yarber, Director of Operations at Limestone Digital.

The pet care industry presents a lucrative business opportunity, particularly in small towns where community loyalty is crucial to business success.

(It's also a relatively inexpensive business idea!)

Focusing on quality care and creating a brand that resonates with pet owners can help you build strong, lasting relationships with customers.

Offering promotions to first-time clients helps attract initial business, but the real growth comes from word-of-mouth referrals. In a close-knit community, positive experiences spread quickly, making your business a trusted choice for pet care services.

3. Yamaguchi suggests businesses like lawn care: thrive through personal connections and word-of-mouth

"In a small town, word-of-mouth advertising and a strong client base who you know personally are often the primary ways that businesses find success.

So, the best businesses can achieve this, including businesses like lawn care, which provide direct services to people. Such businesses, for which you might ask your neighbor for recommendations, are the ones that can really build the loyalty to thrive in small towns."—Jeremy Yamaguchi, CEO of Lawn Love.

In small towns, where personal relationships and recommendations are vital, businesses like lawn and gardening services can flourish.

Jeremy Yamaguchi points out that the trust built through word-of-mouth advertising is invaluable.

When your business provides a service that neighbors recommend to each other, you not only gain new customers but also strengthen your reputation within the community.

This personalized approach is often the key to success in small-town business ventures, where strong local ties can lead to long-term sustainability.

4. Altar suggests starting a funeral home: offering a recession-proof and essential service

"Starting a business in a small town? Go for a funeral home. It sounds morbid, but it's recession-proof.

Unlike trendy cafes or boutique shops that may struggle with a limited customer base, people will always need funeral services. It's a unique opportunity to provide a dignified, necessary service while establishing a steady, reliable business.

Plus, you can build strong community ties by offering compassionate support during difficult times. This unconventional approach can be surprisingly lucrative and offers an essential service that will always be in demand." - Renante Altar, Project Manager of Creloaded.

Though it may seem unconventional, starting a funeral home in a small town can be a wise business decision.

The demand for funeral services is constant, making it a recession-proof industry.

By offering compassionate and respectful services, you can build deep connections within the community, providing not just a business but a valuable service during some of life's most challenging moments.

This combination of necessity and empathy creates a reliable business model that can thrive in any economic climate.

Unsure about how to start a business? Read our article “How to Start a Business (In Just 10 Steps!).”

5. Staupe suggests starting a trade: building a business on the enduring need for skilled labor

"I know that learning any skilled trade in a small town, and building a business around it, is a good plan. There are fewer and fewer people going into skilled trades, but everyone still needs carpenters, plumbers, and electricians. AI can't do what we do.

Maybe in 50 or 100 years, there will be affordable plumber robots, but not in this lifetime. In addition to the demand, in a small town, you don't have to compete with massive marketing campaigns. A small town self employed plumber can stay busy from word of mouth marketing alone.

So, if you're looking to start a business in a small town, look for a skilled trade to learn. But keep in mind that construction aren't the only types of trades to choose from. Picture framers still survive in small towns. Appliance repair. There are many businesses to consider." - Dan Staupe, Co-Owner of Compass Exteriors.

Dan Staupe emphasizes the enduring need for skilled trades, which remain essential despite technological advancements.

These trades are especially valuable in small towns, as there is often less competition and a strong reliance on personal recommendations.

Whether it's carpentry, plumbing, or another specialized trade, the demand for skilled labor is unlikely to wane.

Additionally, the variety of trades available means there are numerous paths to success, each offering the opportunity to build a vital and respected business within the community.

6. Dzhingarov suggests starting a remote business: leveraging digital opportunities in a small town

"As someone who travels a lot, I manage my business remotely. That means I can do my job from anywhere in the world as long as I have access to the internet. I think a digital or fully remote business is perfect for anyone living in a small town, exactly for that reason.

You can choose any niche or industry that interests you, and you're not limited by the local market.

Furthermore, starting a remote business is much cheaper than opening a physical store or office. You save on rent, utilities, and other overheads, which means you can invest more in growing your business without taking on as much financial risk.

And finally, a digital business lets you connect with customers worldwide, reach a larger audience, and grow your client base even more." - Boris Dzhingarov, CEO of ESBO Ltd.

Boris Dzhingarov's insight into remote businesses highlights the flexibility and scalability of a digital operation.

In small towns, where local market size may limit traditional businesses, a remote model allows you to reach a global audience and create a profitable business.

(A recipe for a successful business!)

The lower overhead costs associated with not having a physical storefront further reduce financial risk, making it an attractive option for entrepreneurs.

You can build a thriving business that transcends geographic limitations by choosing a niche that aligns with your interests and skills. This will allow you to live in a small town while operating on a global scale.

7. Christy suggests starting a specialty retail store: capitalizing on niche markets to build community loyalty

"One of the best business ideas for a small town is a specialty retail store, especially if you can tap into a niche market that isn't being served locally. 

For example, Midwest Cards was founded during the pandemic to serve the growing interest in trading cards, a hobby that saw a resurgence during that time. We catered to collectors, investors, and hobbyists who were looking for high-quality sports cards.

By offering a specialized product with an emphasis on customer service, we built a strong community around our brand, even though our physical location was relatively small." - Jim Christy, Managing Director of Midwest Cards.

Christy's experience with Midwest Cards demonstrates the power of niche markets in small towns.

By focusing on a specialized product that isn't readily available locally, you can attract a dedicated customer base and build a strong community around your brand. In small towns, where options may be limited, a specialty store that caters to specific interests or hobbies can quickly become a go-to destination.

Emphasizing customer service can create loyal customers who return time and again, ensuring the long-term success of your business.

8. Neal suggests selling farm supplies/merchandise online: turning local products into global sales

"We operate out of a small town and have had great success leveraging the small town production of farming and selling these items online. Commercial wheat, chickens, and insects are just a few of the small-town items that we can farm at a low cost. And then sell those items online to people who benefit from shopping for those items online.

So the best thing for small town businesses to do is find a product that's developed in your area, and then sell that product online to those who do not live within proximity of that item." - Jeff Neal, owner of The Critter Depot.

Jeff Neal's advice underscores the potential for small-town businesses to thrive by capitalizing on local resources and expanding their reach through online sales.

Businesses can tap into broader markets far beyond their local area by farming products like commercial wheat, chickens, and insects at a lower cost in a small town and then selling these items online.

This strategy maximizes the unique advantages of rural production and connects with customers who are specifically seeking these products but may not have local access to them.

Neal's approach is a powerful reminder that small-town businesses can leverage their specialized products and scale their operations by embracing e-commerce, turning what might seem like a local commodity into a profitable, globally accessible product.

This method effectively bridges the gap between local production and global demand, offering small businesses a path to substantial growth and success.

Forging success in small towns: the power of community-driven business

At the heart of every successful small-town business lies a deep connection with the community it serves. As Dalya Harel wisely points out, your neighbors are more than just customers—they're your partners in building something meaningful.

By engaging with your community on a hyper-local level, you gain valuable insights into their needs and values and establish your business as an integral part of the town's social fabric.

This connection goes beyond transactions; it fosters relationships built on trust, shared experiences, and mutual support.

When you prioritize your community, you create a strong foundation for your business to withstand challenges and thrive over the long term.

Interested in learning more about business and IP protection? Listen to our podcast with successful business owner Daniel Meursing: