Starting a business in KCMO is too expensive, study says; here’s how the city can cut those costs

Entrepreneurs in Kansas City, Missouri, face a higher cost of entry to the world of small business than their peers in St. Louis — or even just across the state line in Kansas City, Kansas, said Jennifer McDonald.

“We look at things like how expensive it is to start a business, how complicated it is, how long the process takes, and what we can do to streamline that process, make it more accessible, more affordable,” said McDonald, project leader for a group called Cities Work that has partnered with the KCMO Small Business Task Force and KC BizCare to help reduce barriers to entrepreneurship.

“So that everybody can realize their dreams of starting a small business,” she explained.

Thalia Cherry, Cherry Co.; Dr. DeAngela Burns-Wallace, Ewing Marion Kauffman Foundation; Phyllis Hernandez, KCMO Small Business Task Force; Nia Richardson, KC BizCare; and Debra Davis, Economic Development Corporation of Kansas City, Missouri; pose for a photo together at an event celebrating entrepreneurship and revealing Cities Work’s study on KCMO; photo by Nikki Overfelt Chifalu, Startland News

Cities Work — an initiative by the Washington, D.C.-based Institute for Justice and funded by the Ewing Marion Kauffman Foundation — presented its Small Business Insights and Policy Recommendation Report for Kansas City, Missouri, on Wednesday during a public, community event at Rochester Brewing and Roasting Company.

The group partners with cities free of charge to help them identify and then rectify some of the biggest barriers in the regulatory space that entrepreneurs face, according to McDonald, who also serves as assistant director of activism at Institute for Justice. She and other project members researched regulations and interviewed city officials and entrepreneurs to generate their findings.

According to a summary of the report — which was commissioned by the task force — Kansas City is known for its abundance of resources to help small businesses owners, but “this support cannot address a root barrier to entry that nonetheless exists: overly burdensome regulations that make it difficult to start a business.”

“Often, regulatory barriers make the business startup process so expensive and complex that only those with the most resources are able to overcome them — effectively blocking access to entrepreneurship for people from modest backgrounds and difficult  circumstances.”

Click here to read the complete report, which features insights from such entrepreneurs as James Thomas, Brain Freeze Mobile Daiquiri; Lisa Peña, Urban Hikes Kansas City; Gigi Jones,

Gigi’s Vegan & Wellness Cafe; and India Monique, Mattie’s Foods.

Within the report, the Cities Work team detailed eight reform recommendations based on its findings:

• Reduce compliance costs to entrepreneurs;
• Eliminate, consolidate, and simplify permits, licenses, and their respective requirements to reduce confusion and resource consumption for both the entrepreneur and the city;
• Bring clarity and accountability into the inspection process both to prepare applicants and inspectors for the application and to reduce the level of subjectivity in inspections;
• Remove or address inefficient or confusing department processes and ordinances through a “spring cleaning” efficiency ordinance;
• Clarify the change of occupancy and change of use processes by publishing a visual chart of the process and engaging with entrepreneurs through an educational outreach campaign;
• Continue building out the city’s one-stop shop and online tools for entrepreneurs.
• Increase access to city resources and staff; and
• Empower city employees to help entrepreneurs and improve communication with entrepreneurs.

“We are making (these recommendations) with the hope that the Small Business Task Force will consider working with the city council to get some of those things implemented to pave the way towards small business ownership for everybody,” McDonald explained.

Jennifer McDonald, Cities Work, presents a report on Kansas City’s affordability and accessibility for entrepreneurs; photo by Nikki Overfelt Chifalu, Startland News

After seeing the recommendations, the task force has already drafted three ordinances to help cut red tape and reduce fees for entrepreneurs in the city, said Wes Rogers, Second District Councilman and chair of the task force.

“This city could be better for entrepreneurs and small businesses and you’re gonna see it,” he told the crowd at Wednesday’s event.

From the archives: Mayor appoints city’s first Small Business Task Force as investment in KC entrepreneurs

Wes Rogers, KCMO Second District Councilman and chair of the Small Business Task Force, speaks during an event celebrating entrepreneurship and revealing Cities Work's study on KCMO; photo by Nikki Overfelt Chifalu, Startland News

Small business advocate and entrepreneur Eze Redwood, center, poses with Small Business Task Force Members Morgan Holecek, assistant to the KCMO city manager, and Christine Lau, operations coordinator for Startland, the parent organization of Startland News; photo by Nikki Overfelt Chifalu, Startland News

The Small Business Task Force — appointed by Mayor Quinton Lucas in October and administered by the KC BizCare office — is made up of members from across the business and civic community, including Rogers; Davin Gordon, program officer for the Hall Family Foundation; Thalia Cherry, CEO and founder of Cherry Co.; Morgan Holecek, assistant to the KCMO city manager; Evan Absher, University of Missouri-Kansas City School of Law; Phyllis Hernandez, owner of Sala de Arte; and Christine Lau, operations coordinator for Startland, the parent organization of Startland News.

“We’re really excited that Kansas City is so committed to entrepreneurs,” McDonald noted, “and it has signaled that through the Small Business Task Force.”

Nia Richardson, managing director for the KC BizCare office, said her vision for Kansas City is the “city of entrepreneurs.”

“I want everything here for entrepreneurs,” she explained. “I want you to build here, grow here, work here.”

Check out a photo gallery from Wednesday’s event below.