Entrepreneurs in Seattle have access to generally helpful and well-organized websites that contain information intended to help business owners get through the startup process. However, regulatory processes are complex with a high number of steps involved. In addition to being under the supervision of Seattle’s License and Tax Administration, restaurants and food trucks are also regulated by the joint city-county health department. The department runs a separate website that does not connect to Seattle’s other portals and webpages.
In Seattle, the cost, delays, and complexity imposed by the regulatory process for small businesses make it difficult—or sometimes even impossible—for entrepreneurs to start the ventures of their dreams.
Of the cities studied, Seattle is on average one of the most expensive cities for starting a business. Restaurants pay $7,466 to get started, with $3,662 in building permits and $1,614 for a food permit making up the bulk of the cost. However, Seattle charges only $56 for new business licenses. This makes it less expensive to start home-based businesses that do not require expensive permits.
Seattle’s regulatory websites require multiple user logins, complicating the startup process. Seattle scored a two out of five on our one-stop shop analysis. Despite user-friendly websites that guide entrepreneurs effectively, Seattle could improve the process by creating a true one-stop shop with a single login. Currently, the city uses separate portals such as FileLocal (for business licenses and taxes) and the Seattle Services Portal (for building permits and business-specific licenses).
Restaurants must complete 63 steps and fill out 16 forms to open. Their mobile counterparts must complete 45 steps and 15 forms to start up and must interact with 9 different agencies, adding to the length of time it takes to get up and running.
We calculated this metric by totaling the fees for all the licenses, permits, and registrations each business needs to get started.
Number of Fees
We calculated this metric by counting how many fees governments impose on each business for completing registrations and paperwork.
We calculated this metric by totaling the number of agencies entrepreneurs must work with in order to get up and running—whether in the form of submitting paperwork to an agency’s staff, or in terms of abiding by regulations that an agency has promulgated.
We calculated this metric by counting the number of compliance activities each entrepreneur needs to complete in person, rather than online or by mail.
Number of Forms
We calculated this metric by counting the various forms and applications each business needs to submit
Number of Steps
We calculated this metric by totaling the discrete tasks an entrepreneur must complete to start each of the business types.
There are additional restrictions on two occupations studied that make it challenging for entrepreneurs trying to start small. Mobile food vendors cannot operate within 50 feet of a brick-and-mortar food service business, reducing the number of places food trucks and other food mobile vendors can legally sell their products. Home-based businesses are limited to using 500 square feet of their home, restricting the ability of entrepreneurs to use their home to do business.
Accommodations for New or Small Businesses
Seattle’s revenue-based license system is naturally accommodating to new and small businesses. Businesses just starting out with small amounts of revenue pay the lowest tier of licensing fees. Businesses that are larger with higher amounts of revenue fall into a higher tier of licensing fees.
Officials and policymakers have the opportunity to make it cheaper, faster, and simpler to start a business in Seattle. City officials should:
Lower fees required to start a business, particularly for expensive building and health permits.
Create a true one-stop shop with a single login for entrepreneurs to manage permit and license applications and pay fees. Integrate separate agency websites, such as the health department’s, into a proper one-stop shop.
Remove unnecessary restrictions on businesses that can otherwise accommodate entrepreneurs starting out small, such as the proximity restriction on food trucks and other mobile food vendors.
Dennis Ballen is the founder and “Head Bagel” at Blazing Bagels. Originally started in the neighboring city of Redmond in 2002, Dennis’ bagel shops can be found throughout the Seattle area and claim to have the best bagels west of New York City. Blazing Bagels now employs over 130 people and makes 30,000 bagels a day at the Redmond store and facility. Having opened several Blazing Bagel locations over the years, Dennis is no stranger to cumbersome permitting processes and quirky agencies. His experiences heading downtown to the permitting office were frustrating, where rules about appointments and office hours changed constantly. “You can’t go on a Tuesday, and you can’t go on Thursday, and you have to go before nine o’clock on the opposite days,” says Dennis. “You can’t stand in line. You must have an appointment. It changes all the time.” Dennis had to take time out of his day to head all the way downtown when he could be spending that time running his business. His frustration could easily be remedied by a straightforward process, more accommodating hours, and allowing walk-in appointments. Dennis also experienced frustration with city inspectors. “We had to change our circuit box because it was around 40 years old and needed to be replaced. It took four people from the City of Seattle to come out to not only inspect, but to stand around and watch, to look at it, to supervise. And each person that came in had different time schedules.” Situations like this could be avoided by streamlining the inspection process, which would save not only Dennis’ time, but also city inspectors’ time.