DOING IT WITH EASE

Nashville scores pretty well in ranking of cities’ business climates

BY STEPHEN ELLIOTT

When Arizona State University released its latest “Doing Business North America” report, researchers found that it was relatively easy to do business in Nashville, which ranked 20th out of 130 North American cities based on the 111 data points compiled by ASU. at wasn’t much of a surprise to Nashville’s business cheerleaders — the people tasked with recruiting businesses to town and helping those already here thrive.

“Nashville and Tennessee are regarded as very business-friendly,” says Ralph Schulz, president and CEO of the Nashville Area Chamber of Commerce. “ ere’s no income tax here, the tax burden on businesses is relatively low compared to our benchmark cities and those mid-range cities are where the action is right now.” e Arizona State study ranked Nashville tops when it comes to resolving insolvencies and eighth in employing workers. It is in the top third of the pack on several other clusters of data but ranks just 67th when it comes to getting electricity. So while Nashville’s overall ranking is good — and ahead of or in line with most of its peer cities (see chart) — that doesn’t mean things couldn’t be easier for area entrepreneurs.

Some fundamental city issues can be a drag on both new and old businesses (and residents), Schulz says. While the city is home to more than a dozen colleges and universities, a low unemployment rate in recent years, among other factors, has made nding talent more di cult. ough the city is more a ordable than places like New York or San Francisco, Schulz says a lack of a ordable housing contributed further to the workforce issues.

Schulz notes that companies and employees moving from larger cities (not to mention long-time residents) can nd Nashville’s public transit system lacking, another drag on workforce availability. And, he notes, local entrepreneurs have historically had a relatively hard time securing access to capital, especially from local sources, although this is changing.

While government can play a signi cant role in addressing those remaining hurdles to starting and maintaining businesses in Nashville, high taxes or regulatory burdens do not seem to inject much friction. Courtney Pogue has only been Nashville’s economic and community development director for a few months — he previously led economic development in Dallas — but he says his goal is to make sure all the parts of Nashville’s business ecosystem are working together to help small businesses, speci cally those with 50 or fewer employees. at means bringing together higher education institutions, nonpro ts, chambers of commerce and local, state and federal government agencies. And while attracting big-splash employers like Amazon and Oracle is a part of the job, Pogue also is focused on fostering a healthy and diverse pool of local small businesses.

“To have a balanced platform for economic development, it really entails having a strong small business apparatus to support the city,” he says. “I think there’s been a shift over the past few years as far as the eld of economic development to make sure we’re focusing on small business.” ere’s no better time than now. More people are starting businesses than ever before since the start of the pandemic, the Tennessee Secretary of State’s o ce reports. A lot of that has come from out-of-work people being forced by COVID-19 shutdowns to pivot from previous employment or businesses, but it still represents an unprecedented growth in new small businesses in Tennessee.

“ e proof of the ease of doing business is in the tasting,” Schulz says. “We have high interest on relocations, high interest on expansions, the workforce is attracted to the quality of life, and the ease of business is largely tied to those activities. e ease of doing business in Nashville is being judged by the customers to be pretty good.”

IN THE MIX

Music City compares favorably to most of its peers in a recent report on the ease of doing business.

1. Raleigh 2. Jackson, Mississippi 3. Tulsa 4. Sioux Falls 5. Charleston 6. Houston 7. San Antonio 8. Colorado Springs 9. Cincinnati 10. Cheyenne, Wyoming

… 12. Atlanta 14. Denver 15. Orlando 18. Louisville

20. Nashville

22. Memphis 25. Columbus 26. St. Louis 32. Kansas City 38. Charlotte 39. Chicago 41. Dallas 42. Austin 46. Birmingham 62. Indianapolis 80. New York City 81. Los Angeles

Source: Arizona State University 2020 “Doing Business North America” report