There are a couple of things that can cause a business that would otherwise stay in one location until the end of time decide to fold their tent and place the operation somewhere else.
One of them would be if there is no longer a market for something in an area that this business provides. Many a military town have seen this if a base closes and the main industry around town was the base itself, you will see businesses closing left and right.
The other if the demand is still high for the product that people are selling is if the cost of doing business is so high that it becomes a losing proposition for the people that own the business they will do what anyone with sense would do and that’s move the business somewhere else.
Now, California is one of those states that makes the cost of doing business so high that it’s surprising at points there are even hot dog stands on a street corner let alone a factory or anything like that left.
Via Western Journal:
California — notorious for high taxes and a stifling regulatory environment — reportedly saw 1,800 businesses either relocate or disinvest from the state in 2016.
Business relocation consultant Joe Vranich wrote concerning the results of a new study he authored that he is advising clients “to leave the business-hostile state because its business climate continues to worsen,” according to Investors Business Daily.
Vranich, president of Spectrum Location Solutions LLC, noted that the 1,800 “disinvestment events” that occurred in 2016 were the most since 2008.
Additionally, 13,000 companies left the state during that nine-year period.
“Departures are understandable when year after year CEOs nationwide surveyed by Chief Executive Magazine have declared California the worst state in which to do business,” Vranich said.
“The top reason to leave the state no longer is high taxes,” he said. “The legal climate has become so difficult that companies should consider locating in jurisdictions where they will be treated fairly.”
One business regulation Vranich cited was California’s new Immigrant Worker Protection Act, which fines companies for following federal immigration law.
The consultant pointed out the law creates a dilemma for business owners: face fines either from the state or from the federal government.