DOUGLAS COUNTY — A 2022 survey of
found that Douglas County ranked fifth best county in Minnesota for small business owners and number 990 nationally.
The study used five factors to determine the results:
- Percentage of people in a county with small business income — 11.68%
- Small Business Returns — 24.55%
- Business Income Tax Reported – $9,324
- Five-year change in tax return index for small businesses – 46.10
- Five-year change in small business income index — 7.52
“These five factors were then indexed and equally weighted to yield our Small Business Index,” the study says. “Places with the highest Small Business Index are the places that rank highest in the survey.”
Douglas County has an index of 49.71. The highest — Cook County — had 53.70. Pope County was second in 50.45
The study says that income taxes play an important role in determining the financial success of the business because the owners pay income tax on profits rather than the business itself paying the tax. Tax burdens were determined by using the national median household income and then applying applicable deductions and exemptions before calculating local, state, and federal income taxes.
Nicole Fernholz, executive director of the Alexandria Area Economic Development Commission, says according to the Small Business Association (SBA), a small business is one with fewer than 500 employees.
“Most of our businesses in Douglas County meet that standard, so we tend to consider them all small businesses. But over half of our businesses have fewer than five employees,” Fernholz said in an email and added that there are over 2,000 confirmed businesses in Douglas County. “99% of our companies have fewer than 99 employees. 83% of our companies have fewer than 20 employees.”
Fernholz says there has been a recent increase in the number of new business applicants. In 2021, there were 317. Before that, the average was below 250 per year.
“Small businesses are the foundation of our community. It’s not just the jobs they create and the goods/services they provide, but it’s the impact they have on other community events,” she said. “Small businesses are sponsors of local schools, charities, youth sports teams.”
She attributes the community’s growth to local businesses.
When asked why she thought Douglas County was ranked in the top five counties for small businesses in Minnesota, Fernholz said the county has a diversity of industries with manufacturing, retail, health care, tourism and education as the top job drivers. However, retail trade is the dominant business type in the county, followed by construction, professional services, leisure and hospitality.
“The services that our local businesses provide only confirms that we are a regional center; people come here for their health care and while they’re here they shop and eat. They might plan a vacation and spend the week. Many of the businesses benefits other businesses and it leads to a favorable climate for small businesses,” she said.
Fernholz said those considering starting their own business in the area should visit
to learn about its free business coaching and support services.
Thalen Zimmerman of Alexandria joined the Echo Press team as a full-time reporter in August 2021 after graduating from Bemidji State University with a bachelor’s degree in mass communications in May 2021.
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