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New Study Ranks Houston Among Best Cities for Small Businesses

In a study sponsored by online review company Yelp, Houston has ranked No. 10 among best cities in the United States for small businesses.

The Yelp Local Economic Outlook highlights cities where small businesses have the greatest chances of success. According to Yelp’s blog post announcing the program, it is “an ongoing effort to surface insights from Yelp’s deep data stores to help businesses succeed and to arm policymakers with the information they need to make effective change that will boost local economies.”

The report ranks 50 cities around the country by economic opportunity — the chances of an existing business staying open and a new business thriving. The “opportunity score” is based on several factors, including Yelp activity (reviews, page views, engagement), recent business closure statistics, average business age, and other criteria.

Charlotte, North Carolina topped this year’s list, and our neighbors in Dallas came in at No. 8. The full top-10 ranking is as follows:

  1. Charlotte, NC
  2. Jacksonville, FL
  3. Omaha, NE
  4. Orlando, FL
  5. Charleston, SC
  6. Las Vegas, NV
  7. Tampa, FL
  8. Dallas, TX
  9. Salt Lake City, UT
  10. Houston, TX

Houston also ranked No. 3 on Yelp’s list of Top 10 Cities for Percentage in Net Growth in Number of Businesses, based solely on business open and close rates. The Bayou City was surpassed only by Charleston and Las Vegas, and Dallas placed fourth.

In recent years, sources such as Harvard University have recognized the value of Yelp’s data in measuring economic activity. The Harvard paper “finds that Yelp data can predict business growth, as measured by the Census Bureau, before official statistics are released.”