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The state of Massachusetts is rich in many things.
American history, famous political families, globally prestigious universities, and successful sports team are just a few that come to mind.
But there is one more that may fly a bit under the radar: small businesses.
Not only is the Bay State the third-most densely populated U.S. state – trailing only New Jersey and Rhode Island – but Massachusetts is also one of the fastest growing states in the country. Combine these impressive population statistics with Massachusetts’ high quality of life, top-notch education system, and third-highest per capita personal income in the Union, and you have incredibly fertile grounds for small businesses to flourish.
Simply knowing that Massachusetts is a great place for small businesses was not enough for the team at LendEDU; we wanted to find out which Bay State communities were the very best for starting and operating a small business.
In order to do this, LendEDU licensed data that allowed us to evaluate nearly 500 Massachusetts towns and cities based on the following parameters that we deemed important for small businesses to be successful:
- Population Score (20% of final score)
- Income Score (40% of final score)
- Expenses Score (40% of final score)
The three aforementioned parameters contained a few sub-metrics that were used to calculate the total score for each parameter. All three total parameter scores were added together to get a final score for each town and city. This entire scoring process is explained in more detail at the end of this report.
Continue on to find out which 150 towns and cities in Massachusetts were recognized by LendEDU as the best communities in the entire state for starting a small business.
Best 150 Towns in Massachusetts for Small Businesses
All of the data seen in this report was licensed by LendEDU from Onboard Informatics. Onboard Informatics’ dataset includes stand alone statistics that were used for this study, including population figures and projections, tax data, and income projections. In total, nearly 500 towns and cities in Massachusetts were examined for this report. An arbitrary population cutoff was set at 5,000 – meaning any town or city in the state with a population below that figure was eliminated from further analysis.
The following three parameters and their respective sub-metrics were used to evaluate each and every Massachusetts community based on their conduciveness towards small businesses.
1. Population Score (Weight – 20%, Maximum Point Total – 20 points)
- Daytime Population Score – The difference in the normal population and the population that is present during standard working day hours (Weight – 10%, Maximum Point Total – 10 points)
- Population Growth Score – Forecasted population growth over the next five years (Weight – 10%, Maximum Point Total – 10 points)
2. Income Score (Weight – 40%, Maximum Point Total – 40 points)
- Disposable Income Score – The average disposable income available to residents (Weight – 20%, Maximum Point Total – 20 points)
- Income Growth Score – Forecasted income growth over the next five years (Weight – 20%, Maximum Point Total – 20 points)
3. Expenses Score (Weight – 40%, Maximum Point Total – 40 points)
- Property Tax Score – Property tax rates (Weight – 8%, Maximum Point Total – 8 points)
- Sales Tax Score – Sales tax rate (Weight – 8%, Maximum Point Total – 8 points)
- Utilities Score – Average cost of utilities (Weight – 8%, Maximum Point Total – 8 points)
- Burglary Score – Rate of burglaries compared to the national average (Weight – 8%, Maximum Point Total – 8 points)
- Property Crime Score – Rate of property crimes compared to the national average (Weight – 8%, Maximum Point Total – 8 points)
Each Massachusetts town and city’s respective sub-metric score for a specific sub-metric was ranked against all the other respective community’s sub-metric scores in the same sub-metric on a percent scale from 0 to 100. This process was repeated for each sub-metric. Afterwards, each individual percent rank was multiplied its weight to produce the point total. All of a given town or city’s sub-metric scores in a specific parameter were summed together to get the total parameter score. All three total parameter scores were then added together to get the final score. Communities in Massachusetts with a greater final score were ranked higher on the list and vice versa. Having a high score means that the town or city is generally a good place for small business owners. In that case, small business owners may have to take out fewer small business loans because they can start generating revenue more quickly.
See more of LendEDU’s Research
Author: Mike Brown