Make the process of starting a business less paralyzing

As entrepreneurs and advocates for small business growth in Northwest Arkansas, we talk daily with other entrepreneurs and aspiring ones, especially in historically underserved communities. One comment that we hear regularly is that the prospect of starting a business is paralyzing. There are just too many government requirements, and it’s too hard to understand the process.

The problem is, of course, not unique to Arkansas, as a recent report from the Institute of Justice made clear. The report – titled “Barriers to Business” – reveals the regulations that restrict new businesses in 20 U.S. cities, and it provides a reason for every community in every state to examine the obstacles in their path to entrepreneurship.

The report reveals, for instance, that starting a restaurant in the 20 cities studied requires entrepreneurs to pay an average of 13 different fees for permits and licenses totaling more than $5,300. To open a barbershop in those cities, an entrepreneur must complete an average of 55 steps, with eight different government agencies involved.

While no cities in Arkansas are included in the report, we looked at the four nearest cities that were included: St. Louis, MO; Des Moines, IA; New Orleans, LA, and Birmingham, AL. Opening a restaurant in Birmingham requires 16 fees – the highest of the 20 cities except for Jacksonville (20) and San Francisco (17) – at a cost of $4,403.