An Echo Press Editorial: County ranks high for small businesses

A study measured IRS data to determine the number of small businesses operating in each of Minnesota’s 87 counties as well as how much income they generate.

Here’s a bit of good news to cut through the gloom of COVID-19.

Douglas County is a pretty good place for small businesses to set up shop and thrive.

In fact, a new study ranks Douglas County as the eighth best county in Minnesota for having the strongest small business presence.

Conducted by SmartAsset, a personal finance technology company, the study measured IRS data to determine the number of small businesses operating in each of Minnesota’s 87 counties as well as how much income they generate.

The economic punch small businesses provide are anything but small. In the U.S., they make up 99.9 percent of the businesses. The COVID-19 outbreak, however, had a huge impact on those small businesses, forcing many to temporarily close their doors to abide by social distancing mandates.


As these businesses begin reopening, It may take a while for them to bounce back. But at least here in Douglas County, they should have a better-than-most opportunity to persevere, based on the study.

Here’s a closer look at the research that went into it:

SmartAsset considered three factors – the proportion of people in a county with small business income, how much business income those people reported and the amount of tax a potential resident must pay on their income.

To determine how attractive a region is for small business owners, the study compared the number of people reporting small business income compared to the total tax-filing population of the region. Next, the study compared the total amount of small business income to the total amount of income reported in each region.

Small businesses, according to SmartAsset, are typically incorporated as pass-through entities, meaning that the businesses' owners pay income taxes on the company profits rather than the company itself paying income tax.

Because of this, income taxes can have a large effect on a small business's success. To determine income tax burdens across counties, the study used the national median household income. It then applied relevant deductions and exemptions before calculating federal, state and local income taxes for each location.

These three factors were then indexed and equally weighted to yield the small business index. Places with a higher small business index are better for small business owners.

Douglas County’s small business index landed at 42.44. Only seven counties scored higher – Wilkin with 42.75, Norman with 43.44, Lac Qui Parle with 43.59, Kittson with 44.62, Pope with 44.82, Roseau with 45.43 and Cook, at the top, with 47.39.


If you’re looking for some help in starting a small business, the Alexandria Area Economic Development Commission has helpful resources, provided free of charge. It works with entrepreneurs and small businesses of all types to help with business startups.

The commission can take businesses through the steps – creating a business plan, choosing a location, financing and incentives, and determining legal structure and taxes. For more information, contact the AAEDC at 320-763-4545 or email .

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