15 Small Town Business Ideas

In small towns in particular, businesses need to appeal to a wide base of customers. Unlike urban areas, small towns have a limited amount of customers to earn revenue from. Businesses such as hair salons, hardware stores, and dog groomers tend to succeed because they fulfill common needs for small town residents—but if you’re looking to attract tourists, you might consider an antique store or a unique attraction like rafting or guided tours.

You’ll notice that many of the business ideas below include franchise recommendations. There are a couple of reasons for this. One, franchises provide training and support to owners. In a small town, you will have fewer other business owners to learn from and less support from organizations such as the Chamber of Commerce. Two, the failure rate of franchises is typically very low and they’re usually a wise investment.

Hair Salon

A versatile hair salon is needed in every small town. Not only does everybody need haircuts, but events such as weddings and proms drive business to hair salons. A barber is a common hair establishment as well, but barbers typically have a limited customer base of men and children. In a salon, add-on services like coloring and hair products can increase your profit margins substantially.

If you’re unsure how to start a hair salon from scratch, consider a franchise, such as a Supercuts salon, which also provides color services and waxing. The average Supercuts earns $442,656 in revenue per year. No hair cutting or styling experience is needed to open this franchise. While Supercuts is generally an affordable franchise, it will still cost anywhere from $150,000 to $320,000 in liquid capital to open.

Supercuts requires $150,000 in liquid capital to open a location. This can come from personal funds, investor funds, a bank loan, or a combination.

RV Park

An RV park is an area where RV travelers can park their vehicles and stay for anywhere from a few days to several years. The success of an RV park depends on many factors including online reviews, the state of the grounds, and the cleanliness of the bathrooms. It also helps to have attractive natural features nearby such as a lake, mountain, or river.

Consider diversifying the income of the RV park by building yurts and cabins for locals and vacationers to rent out. Build a restaurant or general store on the RV park grounds to earn additional income from the residents.

It’s fairly affordable to start a basic RV park: anywhere from $30,000 to over $150,000. Cost varies depending on the number of lots, the cost to run electricity to each lot, and the number of bathrooms that need to be built.

Hardware Store

A hardware store sells tools and do-it-yourself products such as building materials and paint. Hardware stores can also sell gardening items such as plants, flowers, and fertilizer. Smaller hardware stores are common in small and rural towns because the towns often don’t have larger hardware stores such as Home Depot or Lowes. To succeed with a hardware store, it helps to have a background in handyman-related work.

A small hardware store can cost less than $100,000 to open. The biggest cost to open this type of store is inventory. If you start small with your store and only purchase the most in-demand items, you can become profitable quickly. Once profitable, expand your product selection. You can also open a hardware franchise such as Ace Hardware for anywhere from $350,000 to over $2 million.

Antique Shop

An antique shop sells vintage items. To open this type of store it’s important to have knowledge or interest in antiques. It helps to have either a steady stream of tourists as potential customers or a population of residents with disposable income and interest in antiques. Many of your local customers will be repeat customers and may rely on your knowledge of the antiques to help them furnish their homes.

As with a hardware store, the cost to open an antique shop is largely in inventory. To open the shop, you’ll need a great selection of quality antiques. It’s possible to open your antique shop for under $100,000, but for that amount of money you’ll only be able to stock a fairly limited selection of antiques or a larger selection of lower priced ones. The antique business is essentially a flipping business, where you make money by reselling an item for more than you purchased it for.

Small Fitness Center

While a small town may not be able to support a large gym such as a Planet Fitness or LA Fitness, a smaller gym may be perfect for your small town. For example, Anytime Fitness requires a smaller location footprint and can cost under $100,000 to open. The challenge with owning a gym is getting people to sign up; however, once they’re members, recurring income is charged every month or year.

Costs can be low to operate a gym. Many of the business systems in a gym are now automated and the business requires fewer employees. For example, member check-in can be done through a gym’s phone app and a front desk entry scanner. Once equipment is paid off, there is little in expenses aside from employee salary and location overhead.

Fitness club membership has close to doubled in 17 years. Source

Coffee Shop

A coffee shop is a versatile business that can serve light breakfasts and pastries in addition to coffee-based drinks. It can be a tourist destination, a meeting location, an evening live music venue, and a work/study space. While it’s possible to start a coffee shop for around $50,000, it will take much more to turn it into a viable tourist attraction. Consider adding a unique feature to attract tourists such as on-site bean roasting, custom made syrups, or a themed interior design.

Additionally, consider having a quiet area or room that appeals to locals who need to work. If a coffee shop has tourists frequently visiting, it’s important to have an area where locals can get away from the noise to work or study.

Fast Food Franchise

Rural towns that are also stops for travelers can be great markets for a fast food franchise. If the place is well-run and clean, local residents may stop there too. Some of the most popular franchises in the world are fast-food-based such as McDonalds, Sonic, and Taco Bell.

Fast food franchises can be fairly costly to start. The minimum investment to open a McDonalds is $1.3 million, and a Sonic is $1.2 million. One of the reasons someone would invest this amount of money in a fast food franchise is the low overall failure rate. Franchise sandwich shops are also a growing franchise and can cost a fraction of what popular fast food establishments cost. Jersey Mikes starts at $240,000 to open and Jimmy Johns starts at $315,000.

Farmers Market

One possible benefit of living in a rural area is direct access to a food source. Instead of purchasing vegetables and meats from a chain grocery store, residents can buy directly from farmers and growers. A farmers market is a great business to gather the local food growers and help them sell their products.

Earn money as a farmers market manager by charging each vendor for a location in the market. As a manager, the service you provide to the vendor is the overall coordination and marketing of the market. A farmers market may be a part-time job when you first start out, but as the number of vendors increases, the coordination can become a full-time job. Start a farmers market for as little as $1,000. Earn up to $50,000 a year as a farmers market owner.

Massage Therapy & Spa

Massage therapy was one of the fastest growing U.S. industries in 2019. Take advantage of this trend by opening a massage location in your small town. Before opening you’ll need a certificate from a massage therapy school, which can cost up to $10,000. Overall, a massage therapy business can cost as little as $50,000 to open a smaller location.

To earn revenue beyond massages, consider spa services such as exfoliation, wraps, aromatherapy, and electrolysis. Each additional spa service will increase the business’s expenses, but the add-ons may appeal to vacationing tourists. To grow your customer base, connect with local hospitality businesses such as cabin rentals, to provide spa packages for vacationing tourists.

Massage franchises increased revenue over 27% from 2017 to 2018. Source

Thrift Shop

A thrift shop is a store that sells second hand clothes, jewelry, handbags, and shoes. To have a well-functioning thrift shop in a small town, it must be stocked with high-quality items. It’s unlikely that a small town can support two thrift shops. A thrift shop can diversify its income by selling more expensive items such as designer handbags and jewelry on websites such as Tradesy and Poshmark.

Thrift shops are also recession-proof. In fact, they tend to perform better during a recession because people are selling their clothes to make additional money and customers are looking to save money on clothes as well. Earn up to $45,000 a year from a popular thrift store.

Winery

Another great business idea for a small town that attracts tourists is a winery. A winery is a fairly costly business to open. A small winery will require a minimum of $500,000 to open. The expenses are high because there is a lot of equipment to purchase, and fertile land to grow grapes can be costly. It’s smart to diversify income for a winery beyond just wine case sales. Consider opening a quality tasting room with food that pairs well with wine, such as charcuterie.

For additional income, network with local bars and restaurants and persuade them to sell your wine as well. Create a well-functioning website so tourists can re-order cases of your wine. Another way to diversify winery income is to build cabins on your winery’s land so that it can also be a location for tourists to stay. Consider starting small with only one or two cabins and build more once the rental occupancy fills up.

Handyman

If a hardware store is too costly to open, consider applying your knowledge of housing repair to handyman work. The tasks of a handyman vary depending on the handyman’s skills. Anything involved with improving and repairing a house falls under the handyman’s domain. Add skills in areas such as electrical, plumbing, and sprinkler systems to earn consistent work.

One way to receive consistent work as a handyman is to make relationships with landlords. Many landlords with vacation rentals (short-term rentals), may not reside in your small town full-time. As a handyman, offer to be the main contact for the vacation rental if repairs are needed. You’ll earn around $20 an hour as a handyman, but with more skills, this rate can increase.

Attractions & Tours

If you’re in an area that attracts tourists, consider providing entertainment to vacationing tourists. Many business-minded people in small and rural towns take what makes their location unique and sell it as an experience. In a small town, options include corn mazes, white water rafting, nature tours, cave exploration, gem and gold mining, ghost tours, and fly fishing guides.

The income potential of selling an attraction depends on the type of business. A corn maze may have more income potential than a fly fishing guide because the fly fishing guide is selling their time in exchange for pay. The corn field maze can earn more money the more customers there are to get lost inside it.

Dog Grooming, Day Care & Boarding

With dog ownership in the U.S. increasing 29% over the past decade, there has never been more demand for pet services. Pet grooming is a fairly affordable business to open. It will cost at least $50,000 to open a small grooming service. The hourly rate for a groomer varies depending on the type of cut, anywhere from $15 to $30 an hour.

Consider adding a doggie day care and boarding service (long-term care) in addition to the grooming service. These additional services will require additional work and possibly more employees; however, your business will be a one stop shop for pet owners. It will be easy to market your day care and boarding business if you have a consistent stream of pet grooming customers. Build a relationship with the dog owner through grooming so they trust you with the long-term care of their pet.

Caregiver

A caregiver (also called a home healthcare professional) is someone who provides assistance to those who are sick, injured, disabled, or elderly. Typically, they provide non-medical day-to-day services, such as meal preparation, dressing, transportation, and housekeeping. As the elderly population continues to grow, the demand for these services will increase.

You typically don’t need a license to become a caregiver, but some states will require a license, and require non-medical training. Visit your state’s official business licensing website to learn more. We recommend additional training such as first-aid and cardiopulmonary resuscitation (CPR) training to increase your caregiving value. Depending on your background and certification, earn anywhere from $12 to $30 an hour as a caregiver.

Bottom Line

Small towns are unique opportunities for small businesses. Customer density is higher than in rural areas, and there’s not as much competition as in urban ones. Businesses in larger cities can get lost in the larger tourist attractions, and locals don’t have the same business loyalty as they do in small towns. No matter which of the small town business ideas you choose, make sure it appeals not only to local residents but also vacationers as well.