Dreaming of starting that small business? Ohio is the perfect place to start. Here's why
Have that business idea you’ve been dreaming of? Well, you’ve come to the right place.
Literally.
If you already live in Ohio, you’re in the perfect place to start a small business. Ohio has been rated the No. 1 best place in the United States to start a small business, determined by the “small business index” created by the financial institution, Finfare.
Seven factors were used to determine the small business index, which focuses on various costs of doing business in a specific state, the availability of commercial space and the success rate of small businesses while operating in the state.
Most of these factors place Ohio in a pretty good position compared to other states, having the highest small business index score of 596.8.
How much does it cost to start a business in Ohio? Two factors in Ohio's favor
Ohio earned the highest score in the Finfare rankings thanks to the state’s lower business costs. The tax rate and minimum wage rates in the Buckeye State are especially inviting.
Ohio has a corporate tax rate of 0%, which is a tax that is levied by federal and state governments on business profits. Nevada, South Dakota, Texas, Washington, and Wyoming also don’t have a corporate tax.
Small businesses in Ohio that earn less than $385,000 per year can pay their employees a minimum wage of $7.25 per hour (the federal minimum), while businesses that earn above the $385,000 threshold abide by a minimum wage of $10.45 per hour.
The low wage base allows business owners in Ohio to spend less on state unemployment taxes.
In addition, low commercial electric bills and LLC fees also allow entrepreneurs in Ohio to spend less on business expenses.
What's the business survival rate in Ohio?
During the first year, the survival rate of a small business in Ohio is 78.5%.
Within 5 years, the survival rate is 53.1%.
According to Finfare, the corporate tax rate and business survival rate were the heaviest factors in determining which states ranked best to worst. Ohio ranks at or near the top in both metrics.
The 10 best states to start a small business
- Ohio
- Nevada
- Indiana
- Arkansas
- North Carolina
- California
- Oklahoma
- Kentucky
- Pennsylvania
- Mississippi
The 10 worst states to start a small business
- District of Columbia
- Alaska
- New Jersey
- Rhode Island
- Connecticut
- Minnesota
- Maine
- Vermont
- Tennessee
- Oregon