Looking to start a new business in West Hollywood? Well …….
WeHo ranks 1,211 on a ranking of the best small cities in which to start a business that has just been released by WalletHub.
That puts it in the bottom 5% of a list of 1,261 cities across the country with populations of between 25,000 and 100,000 residents. Holland, Mich., ranks No. 1.
WalletHub, a personal finance website, ranked the cities across three key dimensions: 1) business environment, 2) access to resources and 3) business costs. It used 18 relevant metrics to evaluate the three key dimensions, each of which was graded on 100-point scale. Each metric was weighted on a 100-point scale. The data comes from the U.S. Census Bureau, Bureau of Labor Statistics, Federal Deposit Insurance Corporation, AreaVibes, Yelp, Indeed, Tax Foundation, LoopNet and WalletHub research.
Some of the biggest issues for small businesses in West Hollywood appear to come from the fact that ours is an expensive city whose economy is built largely on hotels, bars, and restaurants. Their workers typically can’t afford to live in a city that ranks 1,126 in the WalletHub affordable cost of living ranking (in the bottom 10%). Various other studies have shown that as many as 80% of the people who work in West Hollywood don’t live here, and WalletHub says they have an average 27.5-minute commute. Thus it’s likely that some West Hollywood workers, after their long commute home from work and on days off, are more likely to patronize businesses in their neighborhoods in the Valley or the Eastside of Los Angeles than those in WeHo.
Other major issues for small businesses are the cost of office space (WeHo ranks 1,228 with an average cost per square foot of $45.62), the average revenue per small business (WeHo ranks 943 with an average of $2.17 million) and the average growth of a small business’s revenue (WeHo ranks 829 with an actual year over year decline of 1.8%).
That said, West Hollywood ranks relatively well on startups per capita (No. 139) and in the growth in the number of small businesses (10% annually, for a rank of 269).
West Hollywood also is quite similar to nearby cities when it comes to evaluating it as a home for a small business. For example, its overall rank for “business environment,” which includes data such as revenue per small business and other data, is 398. Its “access to resources” rank (which includes availability of educated workers) is 361. And its “business cost” rank is 1216. South Pasadena has an overall rank of 1,208, putting it just above West Hollywood. It ranks 757 in “business environment,” 678 in “access to resources,” and 1,168 in “business costs.” Culver City ranks 254 in “business environment,” 585 in “access to resources,” and 1,207 in “business costs.” It has an overall rank of 1,104
Beverly Hills has an overall ranking of 894, with “business environment” ranked at 231, “access to resources” ranked at 43, and “business costs” ranked at 1,242.
West Hollywood is a progressive city which was founded largely because of the residents desire to implement rent control guidelines. Perhaps is time for the WeHo City council to continue our progressive tradition and implement a Small Business rent control scheme to help encourage entrepreneurs to set up shop here and protect many of the small business men and women who will most likely be forced to close when they receive their next rent increase.
Like the Mueller report, this info simply affirms what we all know. Now, the question: is it worth tryjng to change conditions to promote a better business climate? Should we simply remain the playpen on the LA metro area? As soon as the many employees of the businesses which are already here begin to find work closer to home, perhaps we’ll look closer at what might be impediments to startup businesses.
I agree. Also once businesses jump over all the hurdles, the question becomes sustainability in West Hollywood’s tricky climate. A closer look at the revolving rental scene from Sunset Plaza, Sunset Plaza adjacent, remainder of Sunset Blvd and all our major and minor boulevards. Neighborhood businesses are not being cultivated by meaningful incentives. and not patronized by transient residents. It seems a tourist venue but that is only one part of a healthy commercial community where many working parts are necessary. The only ones that seem to profit are some highly visible real estate agents who cash in coming and… Read more »
it’s because it has a strange demographic.