Is Shelf Corporation Right For You?

Shelf corporations and companies are the new systems to gain instant credibility for the new business you are about to establish.

A shelf corporation is a created entity and has not conducted business. It has no assets, liabilities or stocks. It is an entity which has been set aside to age, and a shelf company is one with limited liabilities, an LLC, which has been aged by setting it aside.

Use of a Shelf corporation:

1. Buying a shelf corporation is quicker and takes just a few hours to complete a deal, whereas creating a new corporation can take up weeks or even months.
2. Investors find an old, established corporation a more viable investment. Lenders are more inclined to offer credit to an older corporation, in comparison to one that is relatively new.
3. Customers also feel more comfortable doing business with an older corporation.
4. Government contracts are easier to procure as they have stipulated rules of granting a contract to a business which has been in existence for at least two years. This can be achieved only if you go ahead and invest in a good shelf corporation.

Along with all these positive features of a Shelf Corporation, there are some other considerations which must be taken into account such as problems one may face in such a takeover. These too have been enumerated below:

1. You need to find out whether it had bad business practices, poor credit or has any pending liabilities.This aspect of the shelf corporation must be checked and probed into properly.
2. Lenders and investors always look extra carefully and will commit and make a business decision only after a thorough check up, meaning that they will find out whether it is an aged or shelf corporation.
3. Check whether it is a legitimate, positive shelf corporation or not. Legitimacy has to be looked into carefully so that you are not misguided in your decision.
4. Internet has many such corporations listed, some even cite references and existing credit ratings and lender relationships. This is a fine source to gain prior knowledge.
5. Check out the age of the shelf corporation. Remember, the older it is, the cost will be greater of course. You will be reaping and gaining out of its life and credibility, for which you will be paying a hefty sum.
6. High cost of a corporation is based on multiple aspects such as availability of their bye laws, minutes of the meetings, articles of incorporation, stock certificates and other similar documents. You must be able to get these for future usage.
7. You need to check out these benefits and see if they are giving you value for money as well as the satisfaction of your money being well invested. A jumpstart is what your business corporation needs and if this is provided by the shelf corporation, then the deal is definitely in your favor and you must go ahead with it. Your business will gain out of your decision.

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