For people who are considering starting a business (or even growing an established business), there are many aspects to consider. A major element to any business is location. The reason for this is because the location of a business has one of the biggest impacts on the success or failure of that business.

Texas is a massive state with a population of 26.96 million (as of 2014). This estimate doesn’t include the number of visitors the state receives every year. The dense population only highlights one reason why Texas is a great place to start a business. However, it also helps to establish the fact that many cities in Texas are simply perfect for so many companies.

While there are too many great cities to mention in this post, we thought we would provide you with a good sample of some of the locations that are considered to be the best cities in Texas for business.


There are several major reasons why many businesses tend to thrive in Dallas.

Central Location – There are several railroads and interstate highways connected to Dallas. Nearby is the DFW International Airport with access to 46 international and 141 domestic cities. It is also very close to other major business centers including, Toronto, Chicago, Los Angeles, New York and Atlanta.

Cost of Living – The overall cost of living in Dallas is 98.9% of the national average.

Taxes – Texas does not charge local, state, corporate or personal income tax. Taking advantage of many foreign trade zone initiatives help businesses to further reduce other types of taxes.

Current Workforce – Above 80% of the workforce in Dallas have their high school education, and over 30% have obtained a college degree.

Business Incentives

When it comes to reducing the cost of doing business for both new and established businesses, Dallas offers many different types of incentives. These incentives vary in terms of what they provide to the business and are offered by the city, state and county.

Incentives include:

  • Job Training
  • Texas Industry Development Program
  • Historic Tax Incentives
  • Foreign Trade Zone
  • Municipal Managements Districts
  • Public-Private Partnership Program
  • Tax Abatements
  • Texas Capital Fund Real Estate Development Program
  • Tax Increment Financing
  • Texas Enterprise Fund
  • Emerging Technology Program
  • Rural Municipal Finance Program
  • Sales and Use Tax Exemptions
  • Texas Leverage Fund
  • Renewable Energy Incentives
  • Texas Enterprise Zone Program
  • Ad Valorem/Property Tax Exemption
  • Texas Economic Development Act
  • Economic Development and Diversification In-State Tuition for Employees
  • Tax Abatement
  • Texas Capital Fund Infrastructure Program
  • Foreign Trade Zone

Major Industries

Currently, there are several industries that seem to perform very well in Dallas. Some of these industries include:

  • Media
  • Food Manufacturing
  • Company Headquarters
  • Instruments
  • Building Design
  • Construction
  • Furnishing
  • Telecommunications
  • Transportation (Manufacturing and Assembly)
  • IT Services

Existing or established businesses in Dallas make up 80% of economic development and job creation.

Small businesses in Dallas have wonderful opportunities to thrive. According to Dallas Economic Development, it is estimated that almost 80% of the business in the city comes from small businesses. This also means that small businesses help to employ almost 40% of the workforce.

Fort Worth

Similar to the other Texas cities on this list, Fort Worth also supports many incentive programs for businesses. These include,

  • Chapter 380 Economic Development Program Grants
  • Public Improvement Districts (PIDs)
  • Neighborhood Empowerment Zones
  • Brownfields Development
  • Tax Increment Financing Districts (TIFs)
  • Tax Abatement Program
  • Enterprise Zone Program

Forth Worth also offers businesses many opportunities for development. It offers special resources to try and help new and established companies to continue to grow. These resources include,

  • Idea Works FW
  • The Office of Building Diversity
  • TECH Fort Worth
  • The Fort Worth Business Assistance Center (BAC)


Addison is a smaller city, just north of Dallas. It has many meeting centers, hotels, and offices that help to support the population in a different area of the Dallas-Fort Worth Area. While it helps that the city’s population grew from 13,085 to 15,518 (between 2010 to 2015), one of the major reasons why Addison is a great place for business is seen in the average business revenue ($40,072,856).

This city also benefits from many of the same initiatives mentioned under Dallas. In particular, ones that fall under the state’s jurisdiction, such as tax exemptions.


Hello, Houston — the biggest deregulated market in Texas.

The Office of Business Opportunity in Houston, Texas strives to support small, local businesses in addition to large corporations. Overall, for small businesses looking for a home, Houston is a great option. The city has a program called, Build Up Houston. This program strives to increase the success of small businesses within the city.

Material covered in this program includes:

  • Estimating and Bidding
  • Bonding and Insurance
  • Business Development Strategies
  • Marketing and Sales
  • Strategic Planning
  • Project Management
  • Accessing Capital
  • Government Contracts
  • Finance and Financial Management
  • Human Resources

Hire Houston is another program the city supports. The idea is that businesses within the same community should support each other in order to generate more jobs. It is Houston’s police for businesses within the city to hire work from within the city first — as long as price or rates are competitive.


There are many reasons why Midland is a great place for businesses in to establish themselves in Texas. This area ranks in at number three within the state for per capita personal income (at $106,588). According to CareerCast, Midland is also one of the best cities for lower cost of living with higher pay. For entrepreneurs, this city also made Forbes’ top ten list of places to establish a start-up business.


There are around 6,907 businesses in Katy, Texas, which makes it the city with the most businesses per 100 people. With several headquarters including, Igloo and major retail centers, Katy serves many people in and around the Houston area. As for major businesses, many of the companies in and around the city deal with energy.

The Katy Area Economic Development council helps to support and build economic growth for the community. This organization helps new and established businesses to make the most out of Katy’s resources. Some of theses resources include,

  • How and where to find business property.
  • Training centers for new and current employees.
  • How to expand current business to grow in other cities and areas of the state.

Reasons why so many people work and establish businesses in Katy include,

  • Location and Climate
  • Cost of Living (6% lower than the national average)
  • Higher Education
  • Arts
  • Shopping
  • Dining
  • Recreation
  • Housing
  • Healthcare
  • Low Unemployment Rate (4.4%)


This Texas city is a great location for international trade and distribution. McAllen has seen a 2.4% increase in job growth with a projected annual job growth of 2.5%. McAllen sees itself as the major business hub within the Rio Grande Valley.

Due to the fact that many Texans head north every winter, McAllen’s small business community is growing. McAllen’s Chamber of Commerce provides several programs to help smaller businesses establish themselves. They also provide help to startups require financial assistance.

McAllen is also a deregulated city — one of many — in the state of Texas.


Temple is another Texas city with a low unemployment rate. It has over 3,900 businesses with many company headquarters including, McLane and Wilsonart Americas. In 2015 the city was ranked as one of the best places to start a business in Texas and came in second for one of the top cities to grow wealthy in the nation. Temple’s major industries include,

  • Advanced Manufacturing
  • Health & Life Sciences
  • Security & Intelligence
  • Aviation
  • Maintenance Repair Operations
  • Distribution & Logistics

Other reasons why Temple is a great location for business include,

  • Population has increased 26% over 10 years
  • 34.6 is the median age
  • Median hourly wage is $18.02
  • Solid infrastructure
  • Tax incentives
  • Other Incentives: Cash grants, Texas Enterprise Fund and Texas Enterprise Zone Program and more.

San Antonio

There are many reasons why San Antonio is also a great option for businesses. Many of these reasons are similar to other cities and include,

Incentives – Financial funding in San Antonio include, tax abatement, freeport exemption, foreign trade zone, industrial development bonds, pollution control property, tax increment financing, and more.

Current Workforce – Business Facilities named San Antonio the number one City for Economic Growth Protection. The city also has a very strong performing economy compared to other cities within the United States. In late 2016, the workforce reached 1,121,449 giving San Antonio an unemployment rate of 3.7%. It is also estimated that over 25,000 students require employment every year.

Quality of Life – There are many events and festivals, not to mention historical sites that bring many people from all over the world to San Antonio. These visitors help the community to thrive by supporting the arts, entertainment and restaurant industries.

In San Antonio there are businesses in many different industries, some of which include,

  • Defense
  • Financial Services
  • New Energy
  • Bioscience
  • Healthcare
  • Aviation
  • Aerospace
  • Advanced Manufacturing


The city of Austin focuses on many areas of growth for their business community. Their major focus in on developing small businesses, music and cultural arts. As a result, Austin was named the number one city for small businesses by Forbes, and Kiplinger Finance Magazine listed the city as a leader in growth for the region.

Initiatives specific to small businesses in Austin include,

  • Grant for Technology Opportunities Program
  • Small Business Assistance
  • Zero Waste Events
  • WaterWise Hotel Partnership
  • Small Business Energy Rebates
  • Business Expansion and Relocation Assistance
  • Community Preservation and Revitalization
  • Commercial Recycling Rebate Program

Austin also offers several grants for non-profit businesses such as,

  • Cultural Funding
  • Non-Profit Home Sales
  • Grant for Technology Opportunities Funding

Deregulated Cities in Texas

Businesses are no different from residential homes. They all require electricity in order to sell and offer their goods and services on a daily basis. However, there is one major difference, and that is businesses tend to require greater quantities of electricity compared to the average home.

The good news is that many areas of Texas are deregulated. This means that businesses have the ability to choose their retail electricity supplier (REP). REPs provide consumers with electricity supply related good and services. While this might not seem like an important factor when deciding to start a new business, it does give business owners more power over what they have to pay for electricity. Since there are many REPs in the market, it generates competition. Competition typically means that rates remain reasonable and low compared to areas that remain regulated.

Of the above mentioned cities, Austin and San Antonio remain regulated. This means that a business owner would need to go through their utility for all electricity related services and concerns.

Commercial Electricity Rates in Texas

Based on the information we’ve published so far regarding commercial electricity rates in Texas, we can see that the average monthly rate ranges from 7.62 to 7.8 cents per kWh.

Today, businesses living in deregulated energy areas like Dallas could signup for REP rates ranging from 5.59 cents per kWh to 3.92 cents per kWh — these rates are based on differing contract lengths, and other factors.  And of course, larger customers with more usage can usually get a much better rate by having someone negotiate on their behalf (like us) directly with local REPs.