Top Considerations When Starting a Business in Hawaii

Moonlight Labs
3 min readJul 6, 2022

New businesses have been popping up all over since the pandemic began. Many crave the flexibility, independence, and fulfillment that only comes through running your own company.

Yet the failure rate has remained the same– 50% of new businesses won’t last beyond five years. And local ventures are not immune.

So how do locals set themselves up for success in their new ventures? Here are a few of our top recommendations.

Top Three Obstacles for New Businesses

With the new business failure rate so high, it’s essential to know the top reasons businesses fail. Three of the most common reasons are failing to meet a market need, insufficient cash flow, and not having the skills or grit to manage the ups and downs.

Market Need

So many businesses fail simply because the market doesn’t want what they’re selling. The solution? Excellent market research, thorough development (including prototypes), and quality marketing campaigns.

Managing Cash Flow

Lack of cash flow is another reason businesses don’t survive– and the Hawaiian market is especially tough (more on that later). So entrepreneurs in Hawaii need to have excellent networking skills and partnerships to gain capital and complete projects at the right price for the value.

Being Able to Go the Distance

Creating a business is a labor of love, with high demands mentally, physically, and emotionally. Entrepreneurs need to clearly understand their capacity and find ways to outsource the rest to combat burnout.

Choosing an Industry

Picking the right industry is the first step to meeting a market need. Here are some of the top-performing sectors of 2022:

● Tech and AI

● Community building

● Environmentally friendly causes

Related to social causes or charitable work

(Need more ideas? Check out NerdWallet’s Most Profitable Businesses of 2022.)

Top Obstacles for New Businesses in Hawaii

Nothing beats the beaches and sunshine of the Hawaiian Islands. But these views come at a steep price, particularly for entrepreneurs.

● Cost of Doing Business is about 23% higher than Mainland costs.

● Raw materials cost between 40–100% more.

● The Big Three Industries (real estate, construction, and tourism) are the lion’s share of Hawaii’s GDP, with significant barriers to entry.

● Labor is in short supply.

But this doesn’t mean you shouldn’t start a business in Hawaii– it just means you must be prepared.

Tips to Succeeding in Hawaii

Even with the increased cost of goods, barriers to entry, and labor shortage, there are real ways to succeed.

● Digital products do not face the same barriers to entry or the increased Cost of Doing Business.

● Non-franchised restaurants experience higher success on the islands.

● Once you’re established, you gain the benefits of barriers to entry.

● The right partnerships can give you a huge leg up.

Leveraging Partnerships

Networking is a massive part of business success– it often comes down to who you know more than what you know. So, with local ventures facing significant obstacles, it’s never been more critical to connect with the partners that will help you succeed.

That’s why Moonlight Labs is sure to be one of your first partnerships with real ROI. We’re in the business of helping entrepreneurs in Hawaii get their websites up and running, prototype their digital products, and create a strong foundation for their online presence. Contact us for a free consultation today!



Moonlight Labs

We are a Maui based technology company with a focus on web and mobile software.