Starting a Small Business in South Dakota

Welcome to the Small Business Startup South Dakota Franchise Directory! Here, you'll find everything you need to begin your journey to business ownership in The Mount Rushmore State. If you're considering starting a small business in South Dakota, read on for an overview of the state economy. Afterward, explore business opportunities and franchises for sale with our South Dakota Franchise Search Tool.

South Dakota Industry Trends

If an industry is performing well, business opportunities within it are often worth exploring. Begin your market research with this list of the South Dakota economy's most significant industries in 2022. Afterward, take your research one step further by investigating niche markets and B2B opportunities within one of these top revenue-generating industries. 

1. Hospitals (Revenue: $7.6 billion)
2. Corn, Wheat & Soybean Wholesaling (Revenue: $6.7 billion)
3. Meat, Beef & Poultry Processing (Revenue: $4.9 billion)
4. Gasoline & Petroleum Bulk Stations  (Revenue: $4.5 billion)
5. Gas Stations with Convenience Stores (Revenue: 4.5 billion)
6. Commercial Banking (Revenue: $4.5 billion)
7. Tourism (Revenue: $4.5 billion)
8. Credit Card Issuing (Revenue: $4.3 billion)
9. New Car Dealers (Revenue: $3.6 billion)
10. Public Schools (Revenue: $3.0 billion)

South Dakota Sector Statistics

When starting a small business in South Dakota, gross domestic product (GDP) is another tool entrepreneurs can use to make investment decisions. Generally, a steadily rising GDP means that people are spending more money and creating more jobs.

The three sectors that contributed most to South Dakota's GDP in 2022 were Finance & Insurance; Agriculture, Forestry, Fishing & Hunting; and Healthcare and Social Assistance. Combined, these three sectors represented 42.4% of the state's GDP. In 2022, the sectors that contributed most to South Dakota's GDP included:

1. Finance & Insurance (Value: $7.5 billion* | Annual growth: 4.2%)
2. Agriculture, Forestry, Fishing & Hunting (Value: $6.7 billion* | Annual growth: 8.4%)
3. Healthcare & Social Assistance (Value: $5.3 billion* | Annual growth: 3.8%)
4. Manufacturing (Value: $4.4 billion* | Annual growth: 3.9%)
5. Real Estate, Rentals & Leasing (Value: $4.1 billion* | Annual growth: 0.8%)
6. Retail Trade (Value: $3.4 billion* | Annual growth: -0.1%)
7. Wholesale Trade (Value: $3.2 billion* | Annual growth: 0.7%)
8. Professional, Scientific & Technical Services (Value: $1.9 billion* | Annual growth: 5.9%)
9. Information (Value: $1.7 billion* | Annual growth: 2.9%)
10. Construction (Value: $1.6 billion* | Annual growth: 1.4%)
11. Accommodation & Food Services (Value: $1.1 billion* | Annual growth: -0.4%)
12. Administration, Business Support & Waste Management Services (Value: $968.8 million* | Annual growth: 10.3%)
13. Transportation & Warehousing (Value: $915.9 million* | Annual growth: -1.9%)
14. Other Services (except Public Administration)  (Value: $854.6 million* | Annual growth: -1.2%)
15. Management of Companies and Enterprises  (Value: $798.7 million* | Annual growth: 0.6%)

*Approximately

South Dakota Population Statistics

A growing population often means greater demand and a steady flow of new customers. If you are undecided about the location of your new business, start by investigating population statistics. Afterward, take your research a step further by exploring population demographics. Doing so lets you decide whether a location is a good match for your target market. 

In 2022, counties with the highest populations in South Dakota included:

1. Minnehaha (Population: 205,539 | Annual growth rate*: 21.28%)
2. Pennington (Population: 111,703 | Annual growth rate*: 10.65%)
3. Lincoln (Population: 71,260 | Annual growth rate*: 58.96%)
4. Brown (Population: 38,832 | Annual growth rate*: 6.3%)
5. Brookings (Population: 35,098 | Annual growth rate*: 9.8%)
6. Meade (Population: 31,178 | Annual growth rate*: 22.58%)
7. Codington (Population: 28,655 | Annual growth rate*: 5.24%)
8. Lawrence (Population: 26,269 | Annual growth rate*: 9.01%)
9. Yankton (Population: 23,571 | Annual growth rate*: 5.05%)
10. Davison (Population: 20,091 | Annual growth rate*: 3.01%)
11. Beadle (Population: 19,674 | Annual growth rate*: 13.08%)
12. Hughes (Population: 17,987 | Annual growth rate*: 5.67%)
13. Union (Population: 17,534 | Annual growth rate*: 21.77%)
14. Clay (Population: 15,297 | Annual growth rate*: 10.34%)
15. Oglala Lakota (Population: 13,699 | Annual growth rate*: 0.83%)

*From 2010 to 2023.

South Dakota Business Opportunities

We hope this snapshot of the South Dakota economy helps as you investigate business opportunities in The Mount Rushmore State! Starting a small business in South Dakota is an exciting journey, and we know you're probably eager to get started. But remember, take your time to explore all your options. While you'll always have the "opportunity" to start your own business, sometimes, it makes more sense to invest in an opportunity that already exists. These are called "Franchise Opportunities," and they offer several benefits, including the recognition of a well-established brand and a proven track record of success. 

To learn more, start by exploring franchise opportunities in South Dakota below!