Ohio named 1 of the top places to start a small business, study shows

CLEVELAND — Ohio is making the list yet again and garnering national attention; a new study shows that Buckeye State is one of the best places in America to start a small business.

This all comes as the Small Business Administration reports roughly 33 million in operations here in the U.S. Ohio is ranked the 6th best place in America to start a small business.

Research shows Ohio’s affordability and internal support make it a top spot to pursue your entrepreneurial dreams. And for many in Cleveland—it’s working out pretty well.

Molly Cheraso is still in the mix and mixing up plenty of mocktails and alcohol-free beverages inside her Ohio City shop.

“It is so close to the real thing that it gives you a placebo effect,” Cheraso said.

News 5 spoke to the Cleveland mom of two back in May of 2023, as she planned to ditch her career in finance and dive headfirst into small business ownership.

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“It’s really a new concept for people, which is why I wanted to have a brick and mortar that was really accessible to people here in Cleveland,” Cheraso said.

She opened Verbena Free Spirited—Non-Alcoholic Cafe and Shoppe last July.

It’s located along West 29th Street in the heart of the historic neighborhood.

“We are thriving one year into our non-alcoholic journey here in Hingetown,” Cheraso said.

A new study from Lendio, dubbed a top marketplace for small business loans, just ranked Ohio as one of the top 10 best places to start a small business in America.

They broke down a series of metrics, which include survival rates of a small business, cost of living, business finances and tax incentives. Ohio ranked sixth overall this year. Last year, it was third.

“There are certainly incentive programs that Ohio has to try and help small businesses. But really, that cost of living is the big deal,” said Lockwood Reynolds, professor of economics at Kent State University.

Reynolds says Ohio has no corporate income tax rate, and overall, low taxes coupled with affordability are why it ranked so high.

He says the news is telling, as 5.5 million new business applications were filed last year.

“If you think about the difference between starting a business here in Ohio versus starting it in, you know, like San Francisco or something like that, it’s just the amount of money you would have to bring in from the customers to offset those much higher costs would just make it a very challenging environment,” Reynolds said.

Caitlin Shea moved to Cleveland from Canada 15 years ago as a pastry chef. She capitalized on the cost of living and warm environment.

She opened Philomena Bake Shop and continues to champion other entrepreneurs.

Ohio named 1 of top places to start a small business, study shows

“When a new business opens up, there’s a wellspring of support from neighbors and residents around the area,” Shea said.

As Cheraso continues to build up Verbena, she stresses that the first year in operation, at times, has its growing pains.

But between a strong support system of fellow entrepreneurs and community— coupled with small business loans, grants through the city and overall affordability—she says it’s all possible.

“These people here that have proven to me, they’ve been in business in this neighborhood for ten years with strong businesses. They’ve shown me like it’s very possible to keep a business up and running,” Cheraso said.

Cheraso stresses that all future business owners must research and review the overall demographics.

Consider the cost of living, your income, foot traffic in the neighborhood, and whether people want and need your product.

Everything is traditionally two to three times more expensive, so be prepared to shell out more cash.

She kept her day job as a parachute for the first year of her business.

The study also reports that small businesses in Ohio have a 53% survival rate compared to other states. Most typically make it past that crucial 5-year mark, which is major.

Florida, Texas, and North Carolina topped the list of other best places to start a small business.

For the full list, CLICK HERE.