2010 Rural Small Business Trends

2010 Rural Small Business TrendsIf you live in Luling, Texas, (population 5080) you don’t need another list of the top trends for big city dwellers. You want to know what’s happening in the small towns. It’s different. You’re more worried about the Citizens State Bank, than Citibank. With those differences in mind, here are the top ten trends for rural small businesses and small town entrepreneurs in 2010.

1. Census 2010 – Population counts are critical for government programs, grants, and more for a decade. Smart small towns and counties will be actively finding ways to get everyone counted. Watch for town meetings to answer questions, and a whole bunch of canvassing. Your small town business will be indirectly affected by the results for ten long years.

2. Health care reform – As we start the year, there are a couple of important rural items in the likely provisions of health care reform legislation. Particularly keep an eye on the student loan forgiveness and other incentives for rural doctors. The Center for Rural Affairs has a straightforward summary.

3. “Shop local” campaigns grow up and out: 2009 was the break out year for Shop Local campaigns. We’ll see even more in 2010. What started with support for retail and downtown businesses will grow up and out, to reach other small-town businesses. I expect to see more surveys of what local businesses need, and more attention paid to ways to help those businesses improve, as a part of the whole local economy.

4. Infrastructure: Construction is underway in many small towns on projects funded by the Recovery Act. Many more projects are still pending, so this will continue to build throughout 2010. Small town construction and trade businesses will be the first beneficiaries. Smart small businesses will find a way to support those construction firms, to benefit their own bottom line.

5. State budget crunches: In small towns, more people (i.e., your customers) work in government jobs. That can be bad news since 30 states hit budget deficits in 2009 and 48 states are facing deficits in Fiscal Year 2010.  I’m also expecting this to mean cuts to government services in outlying areas and more push for school consolidation. Neither is good news for small towns.

6. Broadband gets some attention: With the Recovery Act making a big push on broadband in rural areas and the FCC eyeing some rather slow minimum standards for rural broadband, expect to see more attention focused on rural access to broadband in 2010. Will we see better access? Only in some select areas. Yes, it’s a trend this year, but the solution will be a series of long-term projects.

7. Baby Boomers are migrating. The USDA is predicting more Baby Boomers will retire to small towns than previous generations.  This is going to mean an increase in the active 50-75 age group in some small towns. Get your business ready to welcome these new residents.

8. Regional partnerships: First it was economic development building regional partnerships. Now it’s tourism. Next will be business and entrepreneurship. Working together across traditional small town rivalries is difficult, and maintaining projects over long distances is daunting. But the benefits are worth it.

9. Business lending tightens: Small town businesses have always faced fewer lending options, so more small businesses rely on credit cards for financing. Since credit card companies responded to the recent reform bill by lowering credit limits and tightening their lending, many small town businesses have lost a lending option. All banks look at your last two years of financials for lending decisions. The 2008 and 2009 numbers are pretty bleak for most small businesses, so don’t count on the Citizens State Banks of the small towns to bend the rules to help.

10. Tourism closer to home: I’ve had enough of air travel hassles! I’d rather drive! Continuing the trend from last year, families are taking more driving vacations close to home. Small towns within an hour to an hour and a half away from the metro areas will gain the most. Almost any small town business can find a way to offer visitors a slice of rural life, or a connection to the culture.

31 Comments ▼

Becky McCray


Becky McCray Becky McCray is a small town entrepreneur, co-owner of a liquor store and a cattle ranch. She writes at Small Biz Survival about small business and rural issues, based on her own successes and failures.

31 Reactions

  1. In the UK the hot topic is broadband access in rural areas.

    Villagers in some places are banding together to arrange their own cabling instead of hoping someone else will connect them up.

  2. Shashi Bellamkonda

    Hi Becky,

    This is a great article and thanks for reminding everyone that rural businesses may have different perspectives. Loved the lines
    “If you live in Luling, Texas, (population 5080) you don’t need another list of the top trends for big city dwellers. You want to know what’s happening in the small towns. It’s different. You’re more worried about the Citizens State Bank, than Citibank”.

    Thanks for sharing your thoughts

    Shashi

  3. Martin Lindeskog

    Becky McCray: How big (small?!;) is Alva, Oklahoma? Could you give a list of small cities that still are pretty close to metropolitan areas, are wired and connected (internet connection, wifi places, etc) and have a lively downtown / places for local business meetings. I have lived in Manchester, NH, and Troy, OH.

    Have you read “Life 2.0 – How People Across America Are
    Transforming Their Lives by Finding the Where of Their Happiness” by Rich Karlgaard?

  4. Shop local programs are great because they help keep money in the community, but buying locally produced food also can help you get better tasting food minus all the preservatives and chemicals. I’m particularly picky about my beef and opt for locally grown, grass-fed beef. Can’t beat it.

  5. Fantastic list Becky! I would never had thought that trends would be different for small towns that big cities. Thanks for opening up my eyes. I think the mobility trend and expansion of the internet will make rural living even more appealing.

  6. Joel Libava

    Becky,

    Thank you so much for this “rural” look at things. It was great meeting you at Blogworld, last year, and I’m sure we’ll continue to chat with each other about all things small business.

    Back in the 80′s I actually lived in a couple of small towns while I was pursuing my Radio-TV career, including one in West Texas.

    I wonder what types of marketing are being used there now. I’m really wondering about social media marketing. Is it happening in small town USA yet?

    The Franchise King

  7. John, I pleased to hear some small towns are taking the initiative. Good for them!

    Shashi, thanks for the encouragement, as always. I picked Luling, because I used to live there when I was a kid.

    Martin, Alva, Oklahoma, has a population of around 5,000.
    For a list of really terrific small towns, I suggest you get your hands on a copy of Boomtown USA, by Jack Schultz. He lists 100 small towns doing amazing stuff. Other “top 100 places to live” type lists come out all the time. Keep an eye out for them.
    Finally, I haven’t read the book you mention, but I’ll look for it. Thanks!

    Robert, you’ve hit on one of the big reasons shop local has been such a strong trend: the quality of local food. I gave local food its own entry in the 2009 rural small biz trends: http://smallbiztrends.com/2009/01/trends-for-rural-small-businesses-in-2009.html

    Ivana, we have similarities and differences, and lots to learn from each other! Mostly, we love it out here.

    Joel, small town social media marketing varies considerably. Plenty of rural businesses are not even online! But I’ve seen lots of small businesses experimenting with Facebook pages and interactive sites. Some are on Twitter. Here’s one excellent example: United Linen in Bartlesville, Oklahoma. They are *everywhere* online. http://twitter.com/unitedlinen

  8. Martin Lindeskog

    Becky: Thanks for the book tip. I will add “Boomtown USA” by Jack Schultz to my buying & reading list. Although I am a “city slicker,” I wouldn’t have any problem to move to a small city / town if I have access to a metropolitan area not too far away and that the local area has the “stuff” I need for my worklife. Troy, Ohio, has a population of circa 20,000 people. I have started to read Who’s Your City by Richard Florida.

    Excerpt from Life 2.0 site – http://www.life2where.com:

    “After traveling the U.S. by small airplane during the summers of 2002 and 2003 to gather material and stories for this book, I am convinced that the where of finding your happiness might be as important as the how.”

  9. It’s great to review the many small business trends.
    There are less competition in the rural areas as compared to the urban areas, and these trends can definitely give a fresh kickstart to the new year
    Thanks!

  10. Great post and very interesting perspectives. I think that many of these issues concern rural businesses all over the world. Broadband is also a big issue here (Ireland). If you now factor the role that social media is starting to play, you realise how a big a limiting factor this is.

  11. Niall, it would be interesting to do a global small towns trends list. I may just do that myself!

  12. Great list, Becky. Regarding #9, one trend we’re seeing as part of the research we do for our annual small business competition is that because lending has dried up, more small firms, especially those in small towns and rural areas, are building their cash positions and playing the waiting game on seeking loans, or increasing their lines of credit.

    One trend that I think broke in the news after you wrote this post is the Move Your Money movement. I think it will be interesting, with apparently $902B in play in small, community banks (http://bit.ly/5rd28I) — $115B more than the stimulus package — to see what effect that has in lending and SMB liquidity by the end of 2010.

  13. Mark, I believe you about small businesses waiting rather than borrowing. Unfortunately for a few in tough positions, they cannot wait.

    Move Your Money definitely caught my attention. Looking around my small town, we have four local banks, all locally owned. So most of us already bank local. Small towns with big growth are more likely to have already lost their local banks for out-of-town buyouts. So they have few choices for banking local. And some states, like Georgia are facing a tough situation for all their local banks, as the Atlanta housing losses are rippling throughout their system. (From the Atlanta Business News: http://www.ajc.com/business/state-banking-crisis-impacting-271195.html )

  14. Thanks for sharing. Small business can be the basis of the economy.

  15. Thanks for sharing. Small business has future.

  16. In Bulgaria, the trend is “depopulation” of villages and rural areas !

  17. Fascinating survey, Becky. As you know, I live in *relatively* small town on the Australian east coast, pop. 55,000 down from home town Sydney 4.5m plus. We are on the border and the neighbouring city is big enough by Australian standards – at about 515,000 and growing 6th largest.

    But our town of Tweed Heads is interesting in that it is part of a larger, predominantly rural local government area, still designated a “shire”, just over 800 square miles, with 17 villages, 2 towns and the larger urban area where we live. We can be in the countryside in about 10 minutes from here. We buy as much as we can of fruit and veg from local farmers at the weekend growers’ markets – and are a lot healthier and less out of pocket for our trouble! Broadband is patchy but the Fed govt has launched a multi-billion national broadband plan to have over 93% of homes & businesses with fiber connected directly (not just to the node/curb) and the other 7% with broadband via other technologies (satellite/wireless) – controversial but it is going ahead.

    Interestingly for me over the holidays, visiting relatives in a smaller town (pop 2,000) one person said she had made more friends there in 6 years than in 30 years previously living in a city. She is involved in various sporting and community activities. Thinking about those Boomers heading for smaller towns, I’m wondering, only half-whimsically, is there a hidden rural trend of Living Longer with Better Friendships?

  18. Des, good to see any progress on rural broadband. I like your idea that Boomers moving to rural ares could lead to better, longer lives. We’re seeing fewer moves total this year, so I think the Boomers moving trend is on a delay, but will be back as the economy improves in the future.

  19. Hi Becky,
    I am from Rural India, please give me some rural business idea related to IT/computer. Thanks.

    Regards,
    Subho

  20. Kessie Giddens-Reed

    I live in a small town in south Texas that is part of the Eagle-Ford Shale boom, oil and gas. Do you have any suggestions for business ventures that will thrive in this short lived opportunity. We are trying to attract the oil field workers that are staying in the area.

  21. For the most part rural america is drying up, loss of industrial era jobs etc. If you want to have a decent living in rural america you need to be a business owner or a professional such as a doctor. Hate to be a killjoy but small business has been hammered by the recession and the constant onslaught of corporate plundering; so its easier said than done to make a living in rural areas. Get creative and do NOT depend on the local economy if possible, most people do not support their local business where I have lived, this is usually noticable where ChinaMart’s are located.

  22. John, “for the most part” does not adequately convey the complexity of the issue. Rural areas and small towns vary widely. Some have extremely high poverty rates, and others are prosperous by various measures. If your area is suffering, then it’s incumbent on you to take the initiative to improve your own economic health and your community. Within each town or area, there is a division. Some people are actively supporting their local businesses and community. Some are not. Which side you focus on is up to you.

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