Our move to Texas still had some loose ends to tie up. We still had a lease on a cabin in Big Bear Lake which still had 6 months remaining. We contacted the property manager, explained our situation, and asked if it would be possible to get out of the lease if a suitable tenant was found to take over the lease. They contacted the owner who agreed to allow us out of the lease once a suitable tenant was found. Big Bear Lake has very limited inventory for long term leases due to the demand for short term vacation rentals in the area. Knowing this we were confident that a suitable tenant would be found and sure enough after several applicants the right person was found. This eliminated one of the financial burdens of the move.
We also had a business to shut down in CA. After investigation, we decided that once we arrived in TX we would create a new business in TX using the same EIN, incorporated in TX, merge the corporation in CA into the new TX corporation and then dissolve the CA corporation to avoid the annual CA corporate tax.
This seemed like a great plan as we had an established business in CA that was going to be merged into the new TX corporation so all the credit and goodwill built up in CA would transfer to the new TX corporation. This all fell apart when our business bank in CA saw the the CA corporation was dissolved and informed us that we would need to close our account since we no longer did business in CA and our line of credit was going to be stopped. That hurt. Starting a new business is expensive and doing it without credit is even harder. Our new bank in TX viewed us as a new business with no established credit or history. Our bank in CA could not recognize us since we no longer had a business in CA. It came down to either reopening in CA, as foreign corporation, to keep our credit line open or bite the bullet and work on a cash basis in TX for a couple years. We chose the later. We find that we tend to make more prudent business decision when it is cash being used rather than credit. For a small business, just like a young person first starting out, the less credit you use, the less likely you are to get into financial trouble. We knew that we could succeed in this market without a large marketing budget and using grassroots gorilla marketing so that is what we decided to do. It forces us to get out into our new community and interact one-on-one instead of pushing a brand via social media and other marketing mediums.
Next up; immersion into our new community and where to put down roots.