Small-business confidence has surged to record levels in 2018, with many small-business owners optimistic about recent tax reforms, according to the latest CNBC/SurveyMonkey Small Business Survey. However, as any entrepreneur knows, starting your own business is never a sure bet.
While starting a new business in a less-populated area has its risks — fewer people can mean less talent and resources, or even fewer customers — smaller cities also tend to offer lower costs for anything from office space to labor.
With that in mind, financial website WalletHub looked at 1,261 U.S. small cities with populations between 25,000 and 100,000 people and ranked them based on their potential attractiveness to small-business owners.
The site rated the locations on 18 key metrics across three different categories: Business Environment (including average revenue growth per business, start-ups per capita and average length of work week and commute times), Access to Resources (number of working age, college-educated residents in the area, etc.) and Business Costs (cost of living, office space affordability and others).
So where is the best small city in America to start a new business?
Holland, Michigan easily topped WalletHub's rankings, thanks to a combination of relatively low business costs and easy access to resources like a qualified workforce. The city of just over 33,000 people is located near the shores of Lake Michigan in the western part of the state, about a half-hour drive from Michigan's second most-populated city, Grand Rapids, and roughly an hour from Kalamazoo, the home of Western Michigan University, which has an enrollment of nearly 23,000 students.
And though WalletHub's rankings include small cities located all over the U.S., Utah fared well with six different cities in the top 20. Last year, USA Today named Utah the U.S. state with the best business climate, thanks to a growing working-age population and friendly regulatory environment. North Carolina had three in the top 20.
Check out the 20 best small cities for starting a business in the U.S., based on WalletHub's rankings (the city's rankings in each of the three categories are below, along with a total score on a 100-point scale):
20. Bowling Green, Kentucky
Total score: 53.31
Business environment ranking: 48
Access to resources ranking: 235
Business costs ranking: 275
19. Midvale, Utah
Total score: 53.33
Business environment ranking: 411
Access to resources ranking: 20
Business costs ranking: 158
18. LaGrange, Georgia
Total score: 53.34
Business environment ranking: 614
Access to resources ranking: 165
Business costs ranking: 64
17. Shawnee, Oklahoma
Total score: 53.34
Business environment ranking: 528
Access to resources ranking: 265
Business costs ranking: 44
16. Brighton, New York
Total score: 53.36
Business environment ranking: 141
Access to resources ranking: 459
Business costs ranking: 169
15. Sanford, North Carolina
Total score: 53.43
Business environment ranking: 803
Access to resources ranking: 284
Business costs ranking: 5
14. Springville, Utah
Total score: 53.44
Business environment ranking: 22
Access to resources ranking: 599
Business costs ranking: 170
13. Salisbury, North Carolina
Total score: 53.53
Business environment ranking: 133
Access to resources ranking: 563
Business costs ranking: 4
12. Bountiful, Utah
Total score: 53.58
Business environment ranking: 175
Access to resources ranking: 69
Business costs ranking: 173
11. Enid, Oklahoma
Total score: 53.72
Business environment ranking: 213
Access to resources ranking: 375
Business costs ranking: 73
10. Fort Myers, Florida
Total score: 53.75
Business environment ranking: 120
Access to resources ranking: 136
Business costs ranking: 138
9. Bozeman, Montana
Total score: 53.86
Business environment ranking: 950
Access to resources ranking: 5
Business costs ranking: 212
8. Bismarck, North Dakota
Total score: 54.31
Business environment ranking: 15
Access to resources ranking: 85
Business costs ranking: 454
7. Ogden, Utah
Total score: 54.73
Business environment ranking: 245
Access to resources ranking: 78
Business costs ranking: 31
6. Clearfield, Utah
Total score: 55.68
Business environment ranking: 152
Access to resources ranking: 84
Business costs ranking: 36
5. Cheyenne, Wyoming
Total score: 57.02
Business environment ranking: 1
Access to resources ranking: 582
Business costs ranking: 130
4. Wilson, North Carolina
Total score: 57.07
Business environment ranking: 121
Access to resources ranking: 102
Business costs ranking: 65
3. Aberdeen, South Dakota
Total score: 57.18
Business environment ranking: 233
Access to resources ranking: 132
Business costs ranking: 13
2. St. George, Utah
Total score: 58.39
Business environment ranking: 16
Access to resources ranking: 286
Business costs ranking: 58
1. Holland, Michigan
Total score: 60.62
Business environment ranking: 318
Access to resources ranking: 3
Business costs ranking: 42
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