Arkansas Small Business Grants

Doing Business in Arkansas

If you plan to do business in Arkansas, it can be highly beneficial in the long run. The state boasts a business-friendly environment, low cost of living, a strong workforce, and a strategic location. The Real Gross Domestic Product (GDP) of this state was $148.2 billion in 2024, representing a 3.7 percent increase from 2023. Several key industries in Arkansas contribute to the state’s growing economy, including tourism, business services, wholesale products (such as automobiles and farm produce), manufacturing, sales and distribution, cybersecurity, and fintech, among others.

Why do businesses prefer doing business in Arkansas?

Arkansas attracts both small businesses and large enterprises. Five Arkansas-based companies have been featured in the Fortune 500 list, including Dillard’s, J.B. Hunt Transport Services, Murphy USA, Tyson Foods, and Walmart. ArcBest, a logistics company, has been included in the Fortune 1000 list. In 2024, 11,136 small businesses were established, employing more than 250,000 people. Doing business in Arkansas has never been any easier, nor so profitable and growth-oriented. This is due to the numerous advantages the state offers. The top benefits of this state are:

• Financial Stability – One of the key offerings of this state to entrepreneurs and small business owners is financial stability. This stability is driven by several factors, including competitive Arkansas small business incentives, low overall cost of doing business, and a history of good fiscal responsibility and strong budget management. This helps in reducing deficits while managing debts.
• Low cost of doing business – One of the key factors is the low cost of doing business in this state. This is accompanied by the fact that the state also has a low cost of living, especially when compared to the larger metropolitan areas. Arkansas small business grants, along with lower utility costs, help reduce overall business operational expenses. The state is currently ranked 8th in terms of the cost of doing business.
• Incentive programs – Arkansas offers a wide range of competitive incentive programs for entrepreneurs looking to start a new business, expand their existing operations, or relocate their LLC or corporation from another state. These state-driven incentive programs provide Arkansas small businesses with funding through cash rebates, tax credits, and community grants.
• Tech industries and Startup Ecosystem – One of the salient attributes of starting a new business in this state is that you can operate your company in a diverse industry environment. Information technology is one such industry that is growing in leaps and bounds. Doing business in Arkansas in a promising and evolving startup environment means you will be able to benefit from the business incentives meant for technology-based organizations. You can even participate in initiatives like ARise (Arkansas Innovators, Startups, and Entrepreneurs) and, with the right business plan, can attract incubators, accelerators, and investors.

Small Business Incentive Programs and Grants in Arkansas

When you form a company or move your existing business to Arkansas, you will have access to apply for the Arkansas small business incentives programs. These programs have been established to fulfill the early-stage capital requirements of startups partially. Here is a list of some of the most popular and top incentive programs in this state.

Small Business Grants in Arkansas

When it comes to Arkansas small business funding options, they can be divided into two categories: grants and business incentives. The grant programs differ from loans and other incentive programs, such as tax credits. Small business grants in Arkansas are a type of financial award provided by various public or private organizations to support local businesses. The most significant benefit of applying for a grant is that you will not be required to repay, unlike in the case of loans. Funds acquired through grants can be used for various business purposes, right from starting a business to facilitating operations, improving work processes, and even supporting expansion.

Applied Research Grant Program

The objective of the Arkansas Applied Research Grant Program is to fund various collaborative research projects. These collaborative projects should be between private companies and Arkansas universities. This is one of the top-tier small business grants in Arkansas. It facilitates the advancement of innovative ideas and projects through collaboration, thereby fueling economic growth. New and existing businesses will be able to tackle their challenges regarding fund acquisition while gaining access to some of the brilliant minds in the state. This also makes doing business in Arkansas much easier.

Arkansas Business and Technology Accelerator Grant Program

If you are starting a technology-based company, this is the perfect Arkansas small business grants program for you to apply for. This grant has been introduced by the Arkansas Economic Development Commission (AEDC) to enable technology-based businesses to stimulate growth through innovation. This is a discretionary program where, if you qualify, the grant amount can be a maximum of $250,000. One of the objectives of this Arkansas small business funding and grant program is to create high-wage and high-skilled jobs. It is also directed towards helping companies develop various high-end technological products and services.

Business Incubator Program

Once you form a startup, you can start applying for different Arkansas small business funding programs. The state offers various types of incubator programs for supporting startups and entrepreneurs. These incubator programs not only provide financial resources but also networking and mentorship opportunities that will lead to business growth and expansion in the later stages. These Arkansas small business grant programs are targeted at different industries, including technology, finance, healthcare, and research. Some of the top business incubator programs are:

• Arkansas Small Business and Technology Development Center incubator program
• Spark program by the Venture Center
• An incubator program called Rock It! Lab (Central Arkansas Library System)
• Genesis Technology Incubator (Arkansas Research and Technology Park)
• Programs by the Bentonville Area Chamber of Commerce
• Incubator programs by Plug and Play Tech Center

Small Business Innovation Research (SBIR) Matching Grant Program

The Small Business Innovation Research (SBIR) Matching Grant Program is a nationwide program with outreach in Arkansas as well. There are two phases in this Arkansas small business grants program, and each phase provides a different funding or grant amount. In the SBIR Phase I, you can receive a matching grant of up to $50,000, while in Phase II, the matching grant can be as high as $100,000. Suppose you plan to do business in Arkansas in targeted business sectors specified by SBIR, such as advanced materials and manufacturing systems, information technology, or bio-based Products. In that case, you may be eligible to apply for this grant.

Technology Transfer Assistance Grant (TTAG)

The Technology Transfer Assistance Grant Program (TTAG) is a highly evolved form of funding programs in the state. It is being administered by the Arkansas Economic Development Commission (AEDC). Small businesses and medium-sized enterprises can apply for this Arkansas small business grants program if they operate in a technology-driven industry. This grant program provides necessary financial support to companies for the transfer and deployment of innovative technologies.

• $3,750 as a part of the costs associated with the transfer of new or existing technology from a public or private enterprise to another enterprise based in Arkansas
• $5,000 can be considered as a part of your total project costs, and the first $2,500 will be funded by AEDC. The remaining $2,500 will be shared equally between AEDC and the enterprise.

Are you thinking of starting a new business in Arkansas?

Other Small Business Incentives and Programs in Arkansas

If you plan to do business in Arkansas, you may often need financial assistance to deploy specific projects. You may require funding to start a business, make it operational, create jobs, enable new technology and innovation, and contribute to economic growth in this state. This is where the Arkansas small business incentives programs play a key role. Several programs provide crucial support to small businesses through various funding opportunities, grants, and tax credits. Let’s take a look at some of the most popular and top incentive programs in the state.

Targeted Business Incentive Programs

If you have registered your company in Arkansas and are seeking Arkansas small business funding options, targeted business incentive programs can be helpful. These programs have been designed to encourage economic development among businesses that apply and deploy new and emerging technologies. This type of Arkansas small business incentives program may include various components, such as sales and use tax refunds, income tax credits, small business grants, and funding for payroll or wages. There are, of course, targeted business sectors where this form of financing or financial incentive will be applicable. The sectors are:

• Advanced Materials and Manufacturing Systems
• Agriculture, Food, and Environmental Sciences
• Biotechnology, bioengineering, and life sciences
• Information Technology
• Transportation Logistics
• Bio-Based Products

• Targeted ArkPlus Program
• Targeted Business Payroll Program
• Targeted Create Rebate Program

Tax Back Program

One of the popular and important Arkansas small business incentives programs is the tax back program administered by the Arkansas Economic Development Commission (AEDC). The ‘Tax Back Program’ will provide a refund of your state and local sales and use taxes on the purchase of any material used for the construction of a building. This refund is also applicable to the addition, modernization, or improvement of a building. The sales and use tax refund is also applicable to the purchase of any taxable equipment or machinery that is associated with or used for the said building or project.

Ready to Start a Business in Arkansas?

Arkansas is a pro-business state that offers the ideal mix of infrastructure, talent, and opportunities for small and mid-sized enterprises. Growth and expansion are crucial for every business, but certain factors play a critical role, such as financial assistance and support. Arkansas’ small business funding options are essential for startups and entrepreneurs to drive business growth in targeted industries and sectors. If you want more information on grants and funding programs, IncParadise can provide you with that information.