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Jamba Juice will move headquarters from Bay Area to Texas

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More than 25 years after the first Jamba Juice shop opened in 
San Luis Obispo, the owner of the smoothie company announced 
plans to move its headquarters from California to Texas within 
eight months.

Jamba Inc. will close its Emeryville, Calif., office and 
establish a new corporate home in Frisco, Texas, about 30 miles 
north of Dallas. In a statement, Chief Executive David Pace said 
Jamba was looking for places that had “competitive operating 
costs,” access to “skilled restaurant talent” and an “attractive 
cost of living,” along with a central location for further 
expansion.

“The state of Texas meets all of these criteria and Frisco is a 
community committed to healthy living that aligns closely with 
our overall mission,” Pace said.

The company's lease in Emeryville is set to expire at the end of 
the year.

The move will affect about 120 employees in Jamba's Emeryville 
location. After the company moves, Jamba said it expects to 
employ about 100 employees in Frisco, a mix of San Francisco Bay 
Area transplants and newly hired Texas workers.

As of December, Jamba had 818 stores across the United States. 
The publicly traded company said it has 1,000 employees in 
California alone. There are more than 5,000 workers at franchise 
locations across the state.

Jamba will follow longtime Southern California burger chain 
Carl's Jr. in moving its corporate home out of the Golden State. 
In March, CKE Restaurants Holdings Inc., which owns Carl's Jr. 
and St. Louis-based Hardee's, said it would move its Carpenteria 
headquarters to Franklin, Tenn., next year. The company said the 
move was intended to consolidate the two chains' headquarters in 
one location.

As a whole, the restaurant sector is struggling to deal with 
higher labor costs. If those chains can't pass those costs on to 
consumers, which many have been unable to do, they have to 
reduce costs in other parts of the business, said Nick Setyan, 
senior vice president of equity research at Wedbush Securities.

One option is re-franchising, a model that Jamba and Carl's Jr. 
have embraced over the last few years. As of March, there were 
68 company-owned and operated Jamba Juices and 752 franchised 
stores in the U.S.

“You're seeing them re-franchise in order to have a lower cost 
and a more predictable operating model,” Setyan said. “If you're 
trying to cut costs, then you have to look at it across the 
entire business and look at your headquarters. If that results 
in lower costs, that's always on the table.”

Thanks in part to the success of the technology industry, labor 
and real estate in the Bay Area come at a high price.

Staying in the Bay Area can be lucrative and valuable for 
companies in the innovation sector since employees in the area 
tend to be more creative and productive, said Enrico Moretti, an 
economics professor at UC Berkeley.

“They cost more, but they generate more,” he said.

But for companies in more traditional industries, such as Jamba, 
Moretti said the Bay Area's benefits may not be worth the 
expense.

Jamba is just the latest California company to announce plans to 
relocate to Texas.

In 2014, Toyota Motor Corp. said it would move its North 
American headquarters to Plano, Texas, from Torrance over the 
next three years.

That same year, longtime Los Angeles-based energy giant 
Occidental Petroleum announced that it was relocating its 
headquarters to Houston and would spin off its California assets 
into a separate company.

And nearly two dozen Bay Area tech companies have made the move 
to Texas since 2014, according to the San Francisco Chronicle.

Former Texas Gov. Rick Perry once touted the Texas Enterprise 
Fund and other cash incentives, along with local property tax 
breaks, as important for enticing companies to move. Toyota was 
offered a $40-million grant when the automaker announced its 
move, though the company said incentives had little, if 
anything, to do with the decision.

Jamba was also offered a Texas Enterprise Fund grant of 
$800,000. The company said incentives were not a driver in the 
move to Texas.

Other factors, such as the low corporate tax rate and no 
personal income tax, could also be advantages for companies 
looking to move to the Lone Star State.

Lower corporate taxes mean higher company profits, but possibly 
more important is the income tax aspect, Moretti said. Without 
raising wages, employees can see an increase in their pay, he 
said.

samantha.masunaga@latimes.com

http://www.latimes.com/business/la-fi-jamba-juice-20160506-snap-
story.html
  

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Jamba Juice will move headquarters from Bay Area to Texas "California democrats chase another business to Texas" <worthless@latimes.com> - 2016-08-08 06:49 +0200
  Re: Jamba Juice will move headquarters from Bay Area to Texas Dänk 42Ø <dank@safeword.amsterdam.com> - 2016-08-08 07:32 +0000
    Re: Jamba Juice will move headquarters from Bay Area to Texas Dänk 42Ø <dank@420.org> - 2016-08-10 06:17 +0000

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