| 06 December 2011
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Corporate shells are “shelf corps,” as they are known, that are also companies that have already been formed. These types of companies usually do not have shareholders, officers or directors (unless required to be filed to maintain good standing). They generally have no assets or liabilities. Such an entity is analogous to a new home that has been built and is ready for you to occupy.
By purchasing a shelf corp you have acquired the validation of time. In many circumstances clients judge the value of a business by the length of its business history. Business owners can now claim, "We've been in business for three years," or as old as the corporation has existed, creating the perception of business stability. The use of a shelf corp for this purpose is a marketing strategy aimed at increasing consumer confidence in new businesses. Most people do not ask or care in what capacity the business existed or by whom it was previously owned.
Purchase an established shelf corp from a company for anywhere from ,000 to ,000. This will either be a blank canvas for you to start building corporate credit with the added benefit of corporate age, or possibly a company with established business credit profiles that can be changed into your name.
Once you have purchased a shelf company, it can enable you to establish an immediate history, instant credibility and business image. You can also bid on state and government contracts. These contracts generally have minimum longevity rules for companies that are allowed to bid on their contracts.
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