How to Choose the Best Location for Your Subsidiary

After a decision is made by a foreign company to expand their business into the U.S., the company must carefully consider the best location to establish a U.S. subsidiary. Business owners want to choose a location that will provide the most economic benefits to the company. To accomplish this goal, it is critical to gather information and research the demographics and economic characteristics of the cities you’re interested in. Some of the most important considerations include the geography, the infrastructure, proximity to critical markets, taxes, the transport links/time zones, federal and state regulations related to businesses and taxes and the availability of a well-connected network of professional services.

The best location for your business may depend on the type of business and the type of product or service your business offers. The status of the customers will play a vital role in the decision of location. Amenities and infrastructure such as water supply, power supply, good road network and security are things to consider as well.  Further, you should think about who your customers are and how close they are to the potential location. The demographic profile that you have for your target audience will allow you to make this decision. You should consider the community and if you have customers in that community. Finally, it is important to choose a location with favorable tax laws, one with lower tax rates and fewer regulations.

The city of Miami is a good example of how a location can be well-suited for a business with the right state regulations, demographics, professional network and geographic proximity. Miami, Florida is one of the largest foreign banking centers in the U.S.A and has a booming tourist industry. Florida is a popular state for business owners because Florida does not have a state income tax and Florida allows online company filings with the Department of State. Another important consideration for business owners is the Florida homestead property exemption from real estate taxes and from creditors. Foreign owners may be force to personally guarantee obligations of the entity if the move is the first incursion into the U.S. The Florida homestead exemption provides the business owner with the peace of mind that his/her personal residence will be insulated from legal liability as it is a constitutional right in the state of Florida. The demographic profile of Miami includes a large Hispanic and Latin American community, which may be beneficial to a business  along with Miami’s close proximity to large market cities in the Caribbean and South and Central America.

EPGD Business Law is located in beautiful Coral Gables, West Palm Beach and historic Washington D.C. Call us at (786) 837-6787, or contact us through the website to schedule a consultation.

*Disclaimer: this blog post is not intended to be legal advice. We highly recommend speaking to an attorney if you have any legal concerns. Contacting us through our website does not establish an attorney-client relationship.*

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Oscar Gomez

Oscar A. Gomez is a Partner and Chair of the Litigation Practice Group at EPGD Business Law. His practice focuses on Business Litigation, including but not limited to Business & Partnership Disputes.


*The following comments are not intended to be treated as legal advice. The answer to your question is limited to the basic facts presented. Additional details may heavily alter our assessment and change the answer provided. For a more thorough review of your question please contact our office for a consultation.

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