Incblog for Entrepreneurs

Covering entrepreneurship and business start up questions for non-residents and US citizens.


Sep 30 2015

Why set up a company in the U.S.?

by John Gordon | 21:09 GMT

Setting up a company in the US is the first step in creating a global brand. Famous companies like Google, Apple, Facebook, Twitter, Uber, AirBNB and so many others were formed in America and expanded globally. Other companies started overseas, like Uniqlo, then became global brands after becoming successful in the US.

According to the U.S. Chamber of Commerce, nearly six million Americans are employed by foreign investors who have a company in the United States. This amounts to a $400 billion annual payroll. Every year, thousands more non-residents establish a new business. The country welcomes this trend, recognizing that an influx of foreign businesses creates jobs for U.S. residents which improves the economy.

In 2013, President Obama publicly recognized the benefits of foreign business investments in the U.S. by declaring, that the U.S. is “open for business.” To encourage foreign nationals to set up a company in the U.S., they will find that the U.S. provides tax benefits and governmental incentives. Businesses will also find access to new markets they do not have access to when doing business in their home country. Another benefit is that the U.S. economy is growing, and as it grows, sales of products and demand for services increase.

The U.S. has an advanced higher education system giving companies access to skilled workers they might not find in their home country. If you are considering investing in or setting up a company in the U.S., there a number of reasons why you should go forward with your plan.

The favorable economic environment

America is offering opportunities for foreign investors to purchase U.S. assets, including real estate, at lower prices than in their home country. In addition, in comparison to many other countries, the U.S. is still a wealthy one with over 320 million people in the U.S, many of whom like to shop. There is a wide diversity in income and interest levels and you will find a market in the U.S. whether you are selling computer parts, rain gutters, shoes or any other product or services.

Incentives offered by federal, state and local governments

Many states and some cities offer financial incentives to foreign investors who will establish their business in a specific location. Some incentives are in the form of tax credits and the country has recently lowered commercial real estate taxes for foreign investors. In addition, the U.S. government offers a myriad of assistance to U.S. businesses that will be available to you when you set up your U.S. business.

Your U.S. non-resident owned business gives you the same advantages and responsibilities as a resident owned business

All businesses in the U.S. are treated the same, whether foreign or domestically owned. This gives you the benefit of all the laws relevant to acquiring a business or transferring capital. It puts you on an equal standing with your opponent if there is ever a business dispute.

Access to new markets

All 50 states are interested in increasing the business environment and many cities encourage you to invest in their community. You have virtually unlimited choices for where to set up your business and can choose a geographical terrain and climate zone that suits you.

The U.S. has trade agreements with 20 countries which provides a marketing advantage to U.S. based manufacturing companies. This increases your market by 425 million people. Add this to the approximately 320 millions of Americans and you can see the potential for your business being successful.

Availability of skilled workers

The U.S. is home to 4,000 colleges and universities and more than eight hundred thousand foreign students go to school in America. There are community colleges and technical schools all committed to training students to enter the workforce at all levels. No matter what your business is, you will find hundreds of skilled workers just waiting for the opportunity you can offer them when you begin hiring workers for your new business.

Stable political environment

The United States has a stable political environment which, according to the well-known firm of Ernst and Young, makes it the “most attractive market for venture capital and private equity funding.” Of all countries involved in international trade, the World Bank ranked the U.S. fifth for its overall “ease of doing business.”

Movement of goods

If your business is manufacturing or selling goods, the U.S. provides efficient connections to the world-wide market through air, sea, rail and highway travel. The U.S. is home to seven of the top 10 cargo moving airports for efficient moving of goods.

Technological advancements

Access to advanced technology, which the U.S. is known for, increases the desirability of the U.S. as a place to do business. Many foreign investors are starting companies in the U.S. just to have access to the advanced technological innovations which will enhance their business production and world-wide communication.

Protection of intellectual property

The U.S. leads the world in the way it protects intellectual property rights (IPR). The U.S. patent office receives approximately one million applications for patent or trademark protection. The office stringently enforce the law and provides you protection from infringement.

If you are a foreign national who is considering starting a business in the U.S., the advantages are on your side. Now is the time to pursue your dream and begin the work of starting your U.S. based business.




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