Florida is in the middle of the pack when it comes to business survival rates five years after launch. According to the Small Business Administration (SBA), there are approximately 2.8 million small businesses in Florida, which make up 99.8% of all enterprises in the state and employ 3.6 million workers, or 41.1% of the state's private sector labor force. With the right systems and people in place, business owners can focus on growing their business instead of doing everything themselves. The Federal Reserve estimates that, based on historical trends, about half of these closures will be permanent, but it won't be able to say how many companies have been lost due to the COVID-19 pandemic until a few years have passed. AdvisorSmith conducted an analysis of survival rates by industry over the past five years to determine which industries are most and least likely to fail.
For businesses with physical locations, real estate costs vary widely, so it's important to research local markets. To avoid business failure after start-up, business owners must also stay aware of their market and the changing needs of customers. The information industry has the highest failure rate nationwide, with 25% of these companies failing in the first year. Cash flow problems are a major factor in 82% of small business closures. Enterprise Florida is a public-private partnership that provides research on Florida's business growth opportunities and news focused on developing and advocating for trade and exports.
We calculated each state's business failure rates for each of the past five years and also took a weighted average approach to ranking states based on survival and failure rates. Having profiles on popular social media sites is essential for entrepreneurs to look professional and not lose out on business to competitors who do have profiles. A lot of variables come into play when determining which states are becoming less hospitable to small business owners and entrepreneurs. One example is the Small Business Development Center (SBDC) program, which partners with local universities and community colleges to help businesses in their areas. Florida can afford to keep tax rates low because it relies heavily on hospitality tax revenues from its tourism businesses, such as theme parks, hotels, and resorts.