| A shelf corporation is sometimes viewed as a great | | | | you misleading lenders, consumers, and other |
| way to get your business recognized and to make it | | | | businesses when you use this to promote your new |
| easier to get credit. If you are going to contact the | | | | business? There are plenty of ethical concerns with |
| bank to see about a corporate credit card or a line of | | | | shelf corporations that individuals struggle with. While |
| credit, you will have better luck if your business is a | | | | they are legal, many people aren't sure that they are |
| couple of years old instead of a couple of months old. | | | | ethical and they want no part of the process. You will |
| In the eyes of the lender, it reduces the risk involved | | | | also find those that say a shelf corporation is just |
| should they decide to issue you credit. Since at least | | | | another strategy for the benefit of your business. |
| 50% of all new businesses fail in the first year, the fact | | | | There are plenty of factors you need to consider if |
| that you are a couple of years old significantly reduces | | | | you heading down the road towards a shelf |
| the liability in their eyes. This could mean the difference | | | | corporation. Make sure it has a clean record with |
| between you getting the corporate credit you need or | | | | consumers as you don't want to be connected with |
| it being denied. It can also affect your credit limit and | | | | complaints that have been filed against a business |
| the amount of interest that you will pay on it. | | | | name. If it is a legitimate shelf corporation that has |
| Consumers also find you to be more appealing when | | | | never been used this shouldn't be an issue, but make |
| you have some longevity behind you. Consumers are | | | | sure you look at it as well. |
| becoming more interested in finding out how long a | | | | Take a good look at the prices of shelf corporations. |
| business has been in place before they make a | | | | Don't bother with it if you are going to have to invest |
| purchase from it. If they see you have just started out | | | | capital that you have set aside for other purposes |
| they may buy what they want from someone else. | | | | including advertising. Some people are under the |
| However, if the purchase of a shelf corporation | | | | understanding that a shelf corporation offers significant |
| makes it appear older than they will assume your | | | | tax shelters and benefits. This is not the case at all so |
| business has been doing well. | | | | don't think you can recoup that money when you file |
| Other businesses will feel this way as well so a shelf | | | | at the end of the year. |
| corporation can help you secure a very profitable deal | | | | Only you can decide if a shelf corporation is going to |
| with them. They want to make sure the items they | | | | be right for you or not. Make sure you take the time to |
| purchase or the services they need will be fulfilled. If | | | | consider both sides of the issue. You also need to |
| your business is new, they may feel that you don't | | | | think about the cost involved. A shelf corporation isn't |
| have the skills yet to take care of such a large order | | | | always cheap but it can lead to more sales for your |
| or to meet their ongoing needs. They don't want to be | | | | business. Your personal opinion about the process is |
| among your first customers and your learning curve. | | | | going to influence your decision as well. |
| How honest is it to invest in a shelf corporation? Aren't | | | | |