It is always difficult for Louisiana to lose a corporate headquarters, but it is even more difficult when it involves a homegrown business. Recently, Smoothie King, a company started in Kenner, Louisiana announced the relocation of its corporate headquarters to Irving, Texas, in the Dallas metropolitan area.

Since the oil downturn in the late 1980’s, there has been a steady stream of energy companies moving their headquarters from Louisiana to Texas, usually Houston. This move offered the oil companies a chance to consolidate their operations and save plenty of costs, while trimming their payrolls. Many local residents faced the decision of leaving the state or losing their jobs.

In many ways, the business environment of the New Orleans area never recovered. This is why the news of Smoothie King leaving Louisiana brings back painful, yet familiar, memories. In this case, the expiration of a $2.4 million economic development package certainly played a role in the decision. Also, air travel is easier from the Dallas-Fort Worth airport with more nonstop international flights. Another big factor is the tax environment in Texas is very pro-business. The state has no income taxes, while Louisiana not only has an income tax; it also has the highest sales taxes in the country.

According to Smoothie King CEO Wan Kim, the Dallas area offers “a more centralized location, a larger talent pool to further enhance our growing team, and access to a greater number of quality vendors and suppliers.” There were no financial incentives offered to Smoothie King to encourage their move to Texas, but, Kim noted that “Dallas offers the advantages of being a major food and beverage hub.” Several competitors of Smoothie King, including Smoothie Factory and Jamba Juice, also call Dallas home.

After the move this summer, Smoothie King will continue with a smaller office in Metairie and will keep the naming rights on the basketball arena, the home of the New Orleans Pelicans. It is ironic that the arena will be named after a company that will be headquartered in Dallas, Texas. Currently, in Louisiana, only two of our corporations, Entergy and CenturyLink, qualify for the Fortune 500 list. Thus, it is almost impossible to find a local corporation that has the financial means to sponsor the arena or any other major sports complex.

This decision should be a wake-up call for our local and state leaders. Louisiana is not doing enough to retain our businesses and attract high paying jobs to the state. While there have been periodic announcements of start-up companies moving to the state, much more needs to be done.

A good first step would be to emulate the successful strategies employed by Florida and Texas, both states with no income tax and a thriving business climate. Otherwise, Louisiana can continue to watch other states prosper at our expense.











