We may earn commissions if you use the recommended services on this site.  



Arkansas is a state that has been steadily growing in popularity among entrepreneurs looking to start a new business. With a business-friendly climate and a growing economy, Arkansas offers many advantages for those looking to start a business.

With a low cost of living, business-friendly climate, and access to capital, Arkansas offers news businesses many advantages. The state has worked to streamline regulations and lower taxes to make it easier for businesses to operate and grow. Additionally, Arkansas has a skilled workforce in industries such as healthcare, transportation, and manufacturing. While there are some challenges to consider, such as limited access to major markets and infrastructure challenges, overall, Arkansas can be a great place to start and grow a business.

Pinnacle Mountain State Park, Big Rock Township

In this article, we will explore the pros and cons of forming a business in Arkansas, as well as the steps required to do so.

Pros of Starting an Arkansas Business:

  1. Low Cost of Living: Arkansas has a low cost of living, which can translate into cost savings for businesses. This can be particularly advantageous for startups and small businesses.
  2. Access to Capital: Arkansas has a growing startup ecosystem and a range of resources to support business growth, including access to capital through investors, grants, and other funding sources.
  3. Business-Friendly Climate: Arkansas is known for its business-friendly climate, with low taxes and streamlined regulations. This can make it easier for businesses to operate and grow.
  4. Quality of Life: Arkansas offers a high quality of life, with beautiful natural surroundings, a mild climate, and a low crime rate.
  5. Skilled Workforce: Arkansas has a skilled workforce, particularly in industries such as healthcare, transportation, and manufacturing. This can be advantageous for businesses looking to hire talented employees.

Cons of Starting a Business in Arkansas:

  1. Limited Access to Major Markets: Arkansas is not located near major markets such as New York or Los Angeles. This can make it more difficult for businesses to reach a wider customer base.
  2. Infrastructure Challenges: Arkansas has limited public transportation and can be difficult to navigate for businesses operating in rural areas.
  3. Limited Diversity: Arkansas is not known for its diversity, which can be a disadvantage for businesses looking to appeal to a broad range of customers.
  4. Limited Resources: While Arkansas does have resources to support business growth, these resources may not be as extensive as those available in larger states.
  5. Natural Disasters: Arkansas is prone to natural disasters such as tornadoes and floods, which can disrupt business operations and cause property damage.

Steps to Form a Business in Arkansas:

  1. Choose a Business Name: The first step in forming a business in Arkansas is to choose a unique business name that is not already in use by another company in the state.
  2. File Articles of Incorporation: To officially form your business in Arkansas, you must file Articles of Incorporation with the Arkansas Secretary of State. The form requires basic information about your company, including the name, address, and contact information.
  3. Obtain Business Licenses and Permits: Depending on the nature of your business, you may need to obtain additional licenses and permits from the state of Arkansas or local authorities. Examples include a business license, zoning permit, and tax registration.
  4. Register for Taxes: All businesses in Arkansas must register for state and federal taxes. This includes obtaining an Employer Identification Number (EIN) from the IRS and registering for state income tax, sales tax, and other applicable taxes.
  5. Draft an Operating Agreement: While not required by law, it is highly recommended that you draft an operating agreement for your business. This document outlines the ownership structure, management responsibilities, and operating procedures for your company. It can also help protect your personal assets in the event of a legal dispute.

In conclusion, forming a business in Arkansas can be a smart choice for entrepreneurs looking to take advantage of the state's low cost of living, business-friendly climate, and access to capital. However, there are also some challenges to consider, including limited access to major markets and infrastructure challenges. By following the steps outlined above, you can establish your business in Arkansas and take advantage of the state's many benefits.

Start Your Business Today

We have vetted over 60 reputable, market-leading business formation service companies. The 3 below have been hand selected by experienced business owners. These choices represent the highest value solutions, considering price, ease of use, customer service, and support services.

inc authority business formation services


Starting at
$0 + State Fees
Top-Rated Budget Choice

4.9 of 5 Stars
25,000+ TrustPilot Reviews

Get Started
Best $0 Service
  • $0 Registered Agent Service
  • $0 EIN Tax ID Creation
  • Online Document Access
  • Ad Hoc Compliance Alerts
  • Scan All Inbound Mail to Online Account Portal
  • Limited Customer Support
Northwest Registered Agent LLC filing services

NW Registered Agent

Starting at
$39 + State Fees
Top-Rated Customer Service
Great For 1st Timers
Get Started
Best For Rookies
  • Data Privacy By Default
  • Private Business Address
  • Online Document Access
  • Mail Forwarding Service
  • Access to other formation services
  • Free Registered Agent

There are many business formation services on the market, and the biggest differentiators are cost and customer service. We have carefully analyzed customer testimonials, customer success, business history, and product details to present you with the 3 most popular, highest-rated options.

Compare Online LLC Filing Services Today

We work with the market leaders in business formation and registered agent services.

Getting started is simple and inexpensive. Form your business today & secure your brand name before someone beats you to it! Click below to view the Top 3 Best LLC and registered agent service providers.
View Top 3 Providers Now

Filing An LLC Can Be Complicated

Streamline Your LLC Filing Online for $39

Northwest Registered Agent is the best-rated service for first time filers.

Get professional LLC formation & registered agent services for only $39 + state filing fee. This offers includes your full LLC setup, plus a private business address, lifetime support, and more.

Trusted by Millions. Save 82% Today.

We may earn commissions if you use the recommended services on this site.