Location matters: state rankings for businesses

8/2/2011

While the old adage "location is everything" holds true for many types of businesses, sometimes the broader region is also a factor in a company's success.

The 2011 CNBC rankings of the top states for business awarded Virginia first place in overall scoring, based on factors including local economy, quality of life, education level and a number of other categories. Texas was a close second, which is unsurprising as and the two states have either shared the top spot or ended up first and second since the first poll was conducted in 2007.

Although Virginia is a perennial favorite, the state didn't win any individual awards this year - second place in the Business Friendliness category was its best showing. The aspects involved in determining friendliness include state business regulations and legal matters.

Two of the most important factors for many business owners are the cost of running a business and access to capital. Virginia ranked relatively low on both counts (near the middle of the pack), and although Texas saw a decent amount of venture capital, it also landed low on the cost-of-business scale.

Finding the best state in which to open a business means researching which states would best foster a specific industry. If a commercial loan is necessary to start or move a company, a marketable location (such as Virginia) may prove to be an asset when approaching lenders.