Relocating Your Business -- Why and How

State and local laws may play a big role in the challenges to your business. There may be taxes, workers' compensation costs, regulations, and other rules that burden your operations, sap your time, and deplete your net returns. Moving to a new state may be just the ticket to lighten your load and get back to doing what you love to do -- running your business to help your customers, clients, and patients.

Which state to choose?

Texas has an advertising campaign to lure current and would-be California business owners to the Lone Star State. Ads promote Texas' business-friendly climate of low taxes and few regulations, but Texas isn't the only business-friendly state. According to the Small Business & Entrepreneurship Council's Business Policy Index, the 10 best states for business are South Dakota, Nevada, Texas, Wyoming, Florida, Washington, Alabama, Utah, Colorado, and Arizona. This index takes into account not only taxes but other items, such as electricity costs, health care regulations, right to work laws, crime, minimum wage, and more.

Clearly, your choice for a new state depends not only on the results of a survey and the prospects for business opportunity, but also on personal issues. These include access to family and old friends, weather, recreational/cultural opportunities, and other non-business matters.

Cost of relocation

It isn't cheap to move. There are the obvious costs of moving business equipment as well as personal and household items and address-change expenses (e.g., new business cards, website updates, etc.). You may need to keep your business locations -- in the old and new states -- running simultaneously for a month or so until the new location is fully operational. And, if you're a corporation or limited liability company, you'll need to take formal steps to become established in your new state (and perhaps terminate your status in the old one).

There are the hidden costs for relocation, such as your time to arrange the move and get established in your new location, not to mention the emotional costs of uprooting your life. The new state may also have different cultural considerations that will take you and your old staff time to adjust to, both in business and personal matters.

Speaking of staff -- relocation may cost you valuable help. Some employees may move while others will choose to stay put. You may need to offer to assist in the cost of employees' relocation. What's more, you'll have the cost of finding and training new employees in your new location.

Retaining business from your previous location

Some types of businesses are more adaptable to a move than others. Internet-based businesses can operate from anywhere there is broadband, so the issue of keeping old customers and clients probably isn't an issue. However, some businesses are effectively tied to their location; for instance, a spa has local customers and a move would mean starting over with new clientele. Decide whether, from a marketing perspective, a move makes sense.

Resources to help you make the move


I'm relocating my business (and my household) from New York (ranked #47 in the Business Policy Index) to Florida (ranked #5). Key issues for me were taxes, the political climate, and the weather. Check my "Contact Barbara" page for my new phone number and address.


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