Top Towns in Texas to Start a Small Business

If you’re looking to start your own business, Texas is a great place to look. Not only does Texas have no state income tax, they also have some of the lowest corporate tax rates in the nation, which makes it perfect for starting a new company.

But Texas is a big state, so it can be hard to choose the best place to set up shop. Should you head for DFW and start a business in the metroplex, or take your chances in a small rural town in the middle of the Panhandle? Both options have advantages and disadvantages, but the ideal town has a few things in common.

Population – A great business town not only has people moving to the area but staying in and working inside the town as well. Furthermore, if you’re looking to open up your own business, you need to look at how much the town is going to grow in the future.

Income – As with population, you’ll need to look at what the average income is presently, as well as what it is projected to be over the next five to seven years. Also, how much of that income is disposable as opposed to cost of living? If you want people to shop at your business, they’ll need to have money to spend.

Cost of Business – Low property and sales taxes aren’t the only thing to consider, you also need to look at how expensive utilities are, as well as the security risks. Not only could your insurance rates be higher, but you may also be paying more to physically secure your business as well.

With these in mind, where should you look? Here’s a list of some of the best business towns in Texas.

1. Weatherford

This formerly small town just west of Fort Worth boasts an ideal location directly next to an explosive metropolis and burgeoning tech hub. Weatherford has experienced dramatic population growth within the last few decades, and as a result, has improved their median incomes as a result. Though expenses are higher than elsewhere, you can still mitigate some of these costs by choosing from different providers to service your business.

2. Castroville

Located in Medina County west of San Antonio, Castroville doesn’t have much of a population to speak of (only 3,000 as of 2010), but the growth is there, largely as a result of people from San Antonio looking to escape big city living. Expect that number to go up over time, and if you open a business now, you can potentially grow with it.

3. Grapevine

The north side of Fort Worth is one of the more scenic in DFW, but businesses that start in the area can expect to pay their share of expenses. Still, with a higher-than-average median income and a booming population growth, you can do a lot worse than Grapevine. Not only is this city in the middle of just about everything, they’ve also invested a lot into restoring the 19th-century architecture that makes it still feel like a small town.

4. Kountze

This small town with a funny name is one of the best-kept secrets in Texas. Far enough outside of Houston and Louisianna to remain its own distinct feel, but close enough to draw talent from both areas, Kountze is the perfect mix of low population, low operating expenses, and sustainable income for its population. The only thing missing so far is the people, but that won’t take long.

5. Levelland

In the heart of the Texas panhandle, is a little town with a lot of “L’s” – Levelland. Located just outside of another “L” town (Lubbock), Levelland has positioned itself as the small town alternative to a part of the world that is growing bigger by the second. The population of 13,000 makes it ideal for new businesses, and the lower than average expenses will undoubtedly help with growth.

6. Andrews

This is one of the only towns on this list that isn’t attached to a major city, but Midland and Odessa – both sizeable cities in their own right – are not that far away. What really sets this town apart is their excellent disposable income. Expenses and population are still low, but there’s enough money in the town to make starting a business worth it.

8. Canyon

Years ago, Canyon was known as Amarillo Lite. They had some of the luxuries that bigger cities possessed, but it was a small college town whose major industry was education. That’s all changed. Now, with operating expenses at an all-time low and population steadily increasing, Canyon has positioned itself as something more: a place where people move to for school, stay for work, and retire in comfort. If you’re looking for a little slice of country to go along with your new business, you could do a lot worse than Canyon.