1. Rural Entrepreneurship Context, Issues and Trends

2. Learning Objectives Define ‘rural’ America
Understand impact of demographic and economic changes in rural U.S.
Explain how current trends influence rural communities
Understand concept of community resilience and its relevance to entrepreneurship
Recognize challenges and opportunities for retail entrepreneurs in rural communities

3. Geographic definition of ‘rural’
All geographic areas outside metropolitan areas—70-80% of geographic area of the US.
Rural—Open country and places with 2,500 or fewer residents
Urban—Places with more than 2,500 resident
Metropolitan—Places with greater than 50,000 residents
Non-metropolitan—inverse of metropolitan
Micro-politan- larger trade center in rural area

4. Demographic characteristics of rural communities
20% of US population lives in rural area
Over the last several decades:
People in 20s have left rural areas
Older people have moved to rural America
Rural birthrate has declined
Hispanic population fastest growing racial/ethnic group
Non-Hispanic white growth rates lowest of any group
Modest growth in African American population 

5. Social and cultural profile of rural communities
Value Attribute
Rural
Urban
Community Interaction
Mandatory
Voluntary
Roles
Ascribed
Achieved
Sanctions
Particularistic
Universalistic
Orientation
Group
Individual
Leadership
Traditional
Rational

6. Social capital in rural communities
Social capital (SC) built through interactions, relationships, networks-unique in rural communities
Developed through interaction among community members
Key influence on community business environment
Economic prosperity associated with social capital
Signals of SC are civic participation, community embeddedness and expectations of reciprocity

7. Rural economy
Core economic activities in rural areas rooted more in old economies than new economies
Diverse economic activity in agriculture, natural resource industries, processing/ manufacturing, government, retail/service
Economic vitality dependent on distance to urban areas, natural amenities, cultural opportunities

8. Changes in rural America
Rural America has experienced significant changes in the last half century
Decline in reliance on farming and other natural resource based industries
Low tech manufacturing declined due to global competition
Population shifts: more older, more Hispanic, fewer young residents

9. What is ‘brain drain’?
Many rural communities have lost younger residents to urban migration
Younger, educated rural residents find employment, social opportunities in urban centers
Loss of younger residents is associated with rural community decline

10. What is a ‘resilient community’?
Successfully adapts to change by utilizing and developing resources that mitigate effects of change
Collective capability to form partnerships, build social capital, and social cohesion
Demonstrates improvement in well being of residents
Able to retain younger, skilled and educated residents

11. Trends and Opportunities for Rural Communities
Suburbanization
Competitive challenges and economic opportunities for rural communities
Seasonal residents
Growth brings challenges and opportunities to rural places
Elder industries
Offer recreational/retirement opportunities to meet older American’s needs
Entrepreneurial growth
Represents core rural development opportunity

12. Trends and Opportunities for Rural Communities
Lone eagles
Urban Americans moving to rural settings and making their livings via the Internet
Next generation of business and community leaders, community philanthropists, mentors for future entrepreneurs
Technology
Rapid advancement makes it easier for rural entrepreneurs to reach broader markets; also raises the competitive stakes for rural businesses

13. Value of local retailers
Local retail stores enhance rural communities
Provide convenient access to goods/services
Source products locally
Employ local residents
Pay taxes
Reinvest profits in the community

14. Challenges for rural retailers
Declining local market
Competition from chains and Internet
High operating costs/lack of economy of scale
Availability of qualified employees
Narrow profit margins
Taxes and regulation
Lack of community support (outshopping)

15. Challenges for rural retailers
Declining local market
Competition from chains and Internet
High operating costs/lack of economy of scale
Availability of qualified employees
Narrow profit margins
Taxes and regulation
Lack of community support (outshopping)