Overcoming Obstacles to Starting a Small Business in the Show-Me State


By Rita Horstman

Small business constitutes a large part of the Missouri economy and provides sustainable jobs for many Missourians. Missouri has 461,259 small businesses, according to the most current federal data. Of those small businesses, 131,405 have employees. The remaining 329,854 are small businesses that have no employees.

These small business statistics for Missouri do not include all self-employed individuals working in Missouri. According to the latest federal data, the number of self-employed persons in Missouri (including incorporated companies that file via Schedule C) was 301,678.


Rita Horstman of Horstman Consulting LLC

Forming a small business, especially if you have no assistance from employees or other entities, comes with many obstacles.  So, what does Missouri “show” the business community in regards to starting a business?  There are many avenues of assistance, but often the resources aren’t comprehensive and focus primarily on financing or business plans.  How difficult is it really for the average Joe to start his business in Missouri?

One must be able to understand the government regulations and system to effectively start their business.  If retail sales are involved and the business is purchased from another owner, it is a potential risk to inherit delinquent tax liability.  This can be detrimental to a new business owner who doesn’t have enough funds to address a previous owner’s debt. Business owners need to check for liens and obtain a tax clearance before making any commitment to purchase a business.  Additionally, if the business has employees and sales tax responsibilities, both government and federal registrations are necessary.  Income tax planning is also necessary.  If the business has employees, a myriad of government contacts and registrations have to be conducted.

Financing for operations and start-up income can be substantial.  There is no red tape-free government funding to help small businesses. There are loan guarantees that a local bank will inform businesses about. However, rates and terms for a commercial loan are not very conducive to initiate growth. To secure financing, a small business must usually have a business plan, which is also essential for effective management, sustainability and growth. There are resources to help individuals with this task. However, when a small business opportunity arises, typically there is not a lot of time for planning purposes.  A business plan and/or strategic plan should be addressed annually.

To encourage success, a marketing plan is also essential.  A number of businesses fail because they do not explore marketing options, nor do they allow for marketing revenue in their budgets.  In all reality, and in my experience working with businesses at the Missouri Department of Revenue and in my personal consulting business, they do not even have a budget; they cash flow everything.

This business sector of the Show–Me State is often neglected and definitively lacks education and assistance in developing and sustaining their businesses.  They are just trying to put food on their tables and make a difference in their communities.  They don’t have the additional funds to join and become active in associations or chambers, but they still need to be represented, because they include the small restaurants, boutiques, antique shops, etc. in the majority of Missouri’s small town USA communities.

Raising awareness of services provided and a holistic approach to delivering those services is essential in supporting every Missouri small business.  The obstacles to starting and sustaining a small business are overwhelming for all individuals.  As the Show-Me State, we need an approach that addresses these obstacles, and goes even further by establishing a solution.

Contact Rita Horstman at horstmanconsulting@gmail.com or 573.690.8358.

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