Small town businesses often do better than their city counterparts at staying open and stable. The numbers back this up—remote rural areas see 72% of businesses survive for 5 years, while only 67% do in big cities. Smart business owners can use these unique market conditions to their advantage.
The impact on local economies is significant. A single new job in a rural area creates three to five more jobs through ripple effects in the community. Small towns give business owners some real benefits. They can keep costs down and build lasting relationships with loyal customers. We've seen this work before—just look at Walmart. They built their empire by starting small and meeting local needs in small towns.
The possibilities go way beyond the usual services these days. Pet ownership has grown from 56% to 65% of American homes since 1988, and the pet industry is now worth $60 billion. This piece will show you the most needed businesses for small towns, ways to serve the community, successful retail ideas, and new chances in rural healthcare and telehealth.
Ready to discover the best businesses for small towns? Scroll down now!
Key Takeaways
- Small-town businesses have higher survival rates (72%) than city ones (67%).
- Essential services—like grocery stores, auto repair, and childcare—anchor rural economies.
- Community-focused ventures (coffee shops, salons, fitness centers) strengthen local ties.
- Retail options such as thrift stores, boutiques, and bookstores thrive through personalization and local sourcing.
- The growing telehealth and wellness sectors offer strong opportunities in rural areas.
- Each new rural business can generate 3–5 additional local jobs, multiplying community impact.
Essential businesses every small town needs
Small towns depend on businesses that serve basic community needs. Big cities might have plenty of options for essential services, but rural communities rely on just a few key businesses that become their lifelines. Here's a look at the businesses every small town needs to stay alive and economically healthy.
Grocery stores and specialty food shops
Fresh food makes a community tick. The numbers paint a stark picture: 76 counties in America don't have a single grocery store, and 34 of these sit in the Midwest and Great Plains. People in these areas can't get fresh produce easily and end up buying processed foods from convenience stores.
Local grocery stores do more than feed people; they bring neighbors together. These stores boost the local economy by creating jobs, generating tax money, and keeping dollars in town instead of sending them elsewhere.
Rural stores barely scrape by with profit margins of just 1%, so they need fresh ideas to survive. Community-owned co-ops have stepped up to fill the gap. Take Emerson, Nebraska, where locals pooled $160,000 to open Post 60 Market after their only grocery store closed.
Auto repair and detailing services
Cars aren't optional in rural areas; they're a must-have. With few or no buses and trains around, people need their vehicles, which creates steady work for auto repair shops.
These repair shops make life easier for locals who need routine maintenance. Mobile detailing has caught on in many areas, letting busy customers get their cars fixed without leaving home.
Word-of-mouth referrals make or break these businesses. One source puts it simply: "Successful mobile car detailing businesses are built on excellent service and word-of-mouth referrals."
Home cleaning and handyman services
People always need home cleaning services, no matter where they live. This business works great in small towns because startup costs are low and personal connections matter more.
The same goes for handyman services—every town needs them. One expert says it best: "a good handyman will always be in demand, even in small towns." These businesses grow when neighbors talk them up, turning satisfied customers into their best advertisers.
Childcare and daycare centers
Working families can't function without quality childcare. The reality hits hard in rural areas—55% of rural children under five live in childcare deserts. The situation looks worse for babies and toddlers, with nine children competing for each childcare spot in rural counties.
Parents struggle when they can't find childcare. Many—mostly moms—have quit their jobs, hurting their family's financial security. Good childcare centers help kids develop social skills and prepare for school, too.
Starting childcare centers tackles these problems head-on while creating lasting businesses that help small towns grow stronger.
Community-driven service businesses
Small-town entrepreneurs build businesses that promote community connections beyond basic services. These places become social hubs where people meet and create the unique small-town atmosphere that makes these communities special.
Coffee shops and bakeries
Local coffee shops have become social centers where people meet and chat. These businesses do well on busy streets where commuters can stop easily, especially those with drive-thru options for parents dropping kids at school or workers heading to nearby cities. Smart coffee shop owners aim for 70-90% profit margins by carefully tracking ingredient costs, shipping, and potential waste.
Pet grooming and boarding
Pet care businesses are booming since pet ownership has jumped from 56% to 65% of American homes since 1988. The best grooming services put animal safety first with features like "7-Point Pet Care Checks" before they start grooming. Many shops make themselves different by providing "Clean Grooming" options without parabens or chemical dyes.
Hair salons and barbershops
Small-town barbershops and salons work as social spots where locals share news and build friendships. These businesses succeed when they find gaps in the town's service needs. Rural salons often stand out by adding personal touches like hot towels and head rubs.
Fitness studios and yoga centers
Small-town gyms adapt to what their communities need. Successful fitness centers often combine multiple services in one place—from dance classes to training sessions. Owners build stronger customer loyalty by listening to member feedback and making changes. A rural gym owner spent $25,000 on a new parking lot after clients suggested it.
Tutoring and after-school programs
After-school programs fill important gaps in rural education despite some challenges. Right now, only 13% of rural children go to afterschool programs, compared to 25% of urban children. These programs help lower dropout rates and reduce risky behaviors in young people. The startup cost is reasonable—about $27,000 yearly per program—making this an available business chance that helps the community significantly.
Retail and product-based businesses that thrive
Product-based retail thrives in small towns and often challenges the dominance of online commerce. Local entrepreneurs succeed when they focus on individual-specific experiences and community needs.
Thrift stores and antique shops
Rural thrift stores serve vital community needs. These stores help families stretch their budgets and keep usable items away from landfills. Small-town thrift shops stock better quality merchandise than their urban counterparts. Antique dealers become tourist hotspots in small towns as visitors search for unique treasures and historical items.
Clothing boutiques and gift shops
Local clothing stores save residents long drives to distant malls. Gift shops prosper by featuring locally-made products, ranging from handcrafted jewelry to regional specialty foods. Many successful small-town boutiques blend multiple product lines under one roof—from clothing and accessories to home goods.
Florists and gardening supply stores
Independent florists outshine national chains through better products and deeper community connections. These local shops pick premium flowers that outlast grocery store options. They also give 250% more to local charities compared to larger competitors. Garden centers thrive by stocking products that match specific local needs and providing expertise that big-box retailers can't match.
Bookstores and stationery shops
Independent bookstores show remarkable growth in small towns. More than 100 new stores have opened in just one region since 2020. These businesses excel through careful inventory selection—"for every book chosen, 200 don't make the cut." Their success comes from creating calm, mentally stimulating spaces that stand apart from today's digital overwhelm.
Bask Health and the rise of health-focused small town businesses
Rural communities throughout America struggle to access healthcare. This challenge opens up amazing possibilities for health-focused businesses in small towns.
Why is health e-commerce growing in rural areas
30 million Americans live in healthcare deserts with limited medical services. This situation has led to a boom in virtual healthcare visits, which have jumped by 400% since 2020. The demand for health products keeps climbing steadily. U.S. wellness sales grew 6.4% year-over-year through Q1 2024. Rural patients have adapted quickly—71% now use virtual care services and 34% own wearable health devices. The wellness industry should reach $8.99 trillion by 2028. Health supplements will grow from $151.80 billion in 2024 to $266.80 billion by 2033.
How Bask Health supports small town wellness
Bask Health created something similar to a "Shopify for Telehealth"—a platform that handles complex tasks like provider networks, compliance, and technology infrastructure. Our solution helps rural providers beat connectivity challenges through text-based options and cellular networks. Rural communities love these services when we implement them properly. Our cloud-based platform uses AI to deliver everything from continuous EHR integration to revenue cycle optimization tools.
Opportunities in local telehealth and wellness services
Telehealth visits cost $40-$80 compared to $136-$176 for in-person appointments. Successful telehealth businesses work through three main models:
- Business-to-Consumer (B2C) serving patients directly
- Business-to-Business (B2B) supporting clinics and insurers
- Hybrid approaches combining both methods
A study in rural Tennessee showed 95% of telehealth patients rated their experiences as good as or better than in-person visits. Patients save about 142 minutes and 145 miles in travel with each consultation. Telecardiology programs generate roughly $1.60 million in positive returns yearly. Healthcare costs drop from $25,000 to $12,000 while quality standards stay high.
Conclusion
Small town businesses show amazing staying power. Their 72% survival rate tells a compelling story about how rural markets work differently. This piece explores business ideas that fill crucial needs and bring steady income in smaller communities.
Local grocery stores and auto repair shops are the foundations of rural economies. Coffee shops and fitness centers have become the heart of community life. The retail scene stays strong, too. Thrift stores and bookshops compete well against online sellers because they build real connections with customers.
Healthcare opens new doors for small town business owners. We at Bask Health see how telehealth fills crucial gaps and creates real business potential. Our platform equips rural healthcare providers with tech tools to beat old challenges. This means better care that costs less for everyone involved.
Smart entrepreneurs should think about what small towns bring to the table. These places offer lower running costs and loyal customers who stick around. On top of that, it creates a multiplier effect—each new business can add three to five more jobs locally.
Some of today's biggest companies started by solving problems in small towns. They grew from there. This still works today. Technology lets rural businesses reach bigger markets while staying true to their local roots. Small town entrepreneurs can build profitable businesses and stronger communities at the same time.
References
- Cramer, R. (2025, March 11). Small town grocery stores face unique challenges. Some Midwest states are trying to help. Harvest Public Media. https://ipmnewsroom.org/small-town-grocery-stores-face-unique-challenges-some-midwest-states-are-trying-to-help/
- Muddy Buddy Dog. (n.d.). Self-service dog wash & professional grooming. https://muddybuddydog.com/
- National Advisory Committee on Rural Health and Human Services. (2023, January). Childcare need and availability in rural areas: Policy brief and recommendations to the Secretary. U.S. Department of Health & Human Services. https://www.hrsa.gov/sites/default/files/hrsa/advisory-committees/rural/nac-rural-child-care-brief-23.pdf
Robinson, A. (2015). Need a business idea? Here are 55. Entrepreneur.
https://www.entrepreneur.com/starting-a-business/need-a-business-idea-here-are-55/201588
