California, September 13, 2025
News Summary
Bed Bath & Beyond has announced its decision to exclude California from its planned return to brick-and-mortar retail, citing high operational costs and extensive regulations as primary concerns. The company’s Executive Chairman criticized California’s business climate, which has led to a trend of corporate relocations from the state. As Bed Bath & Beyond expands with new stores across the country, California will miss out on these developments, reflecting a growing discomfort among businesses operating in the state. This trend raises questions about the future of California’s economy.
California – On August 20, Bed Bath & Beyond announced that its planned return to brick-and-mortar retail will notably exclude California. This decision stems from criticisms regarding the state’s regulatory framework and financial burdens, which the company deems too risky for business operations.
Executive Chairman Marcus Lemonis has openly criticized California’s extensive regulations and high costs, specifically noting the burdens of steep taxes, fees, wages, and other regulatory requirements that hinder business growth. He indicated that these factors have increasingly shifted the company’s focus towards states that provide a more favorable business climate.
Bed Bath & Beyond, which entered bankruptcy in 2023, has rebranded to Bed Bath & Beyond Home and recently opened a new store in Tennessee. The retailer plans to expand further, targeting about 80 new store openings nationwide next year, yet California will not benefit from these developments. This move underscores a trend among companies that are seeking to reduce operational costs and improve profitability.
The corporate exodus from California has gained momentum, with Realtor.com previously relocating its headquarters to Texas in February, citing similar challenges associated with operating in California. The Public Policy Institute of California has reported that business relocation decisions are largely influenced by costs, taxes, regulations, and the availability of skilled labor.
Data reveals that from 2011 to 2021, 789 businesses relocated their headquarters out of California, with a noticeable acceleration in these departures following 2017. In contrast, the number of companies moving into California has plummeted from 137 in 2011 to just 68 in 2021, illustrating a concerning trend for the state’s economy.
Industry experts, including many executives, have remarked on the deteriorating business environment in California, suggesting that factors such as diminished quality of life have triggered many businesses to seek more conducive operational environments elsewhere. In 2023, more than 690,000 residents left California, following an outflow of over 817,000 in 2022. The most popular destination for those departing California was Texas, with nearly 94,000 moves, followed by Arizona and Florida.
High taxes and a costly cost of living are often cited as prime motivators for the exodus, with Texas and Florida marking attractive alternatives as they do not impose a state income tax. The median home price in California has reached approximately $859,700, nearly double the national median of $440,892. To afford a typical home in California, a household needs an annual income of about $213,447, highlighting the economic strain on both residents and businesses.
Corporate giants like Chevron, Tesla, McKesson, and Charles Schwab have also shifted their headquarters to states with lower taxes and fewer regulations. Chevron relocated to Houston in 2024 due to California’s legislations that they argue elevate costs and burdens for residents. Similarly, Tesla moved to Austin in 2021 amid difficulties in scaling operations in the Bay Area due to prohibitive housing costs.
Reports indicate a significant rise in corporate relocations, with over 200 businesses announcing headquarters shifts in 2021 alone. Such trends reflect the broader economic shifts where smaller businesses, alongside larger corporations, are grappling with California’s financial pressures and regulatory landscape.
Despite these challenges, California still boasts a considerable economy, valued at approximately $4 trillion, and continues to attract businesses willing to navigate the complex landscape. However, the ongoing migration of companies poses potential risks to the state’s tax base and funding for public services, signaling a pivotal transformation in California’s business environment.
In conclusion, as Bed Bath & Beyond chooses to bypass California in its retail resurgence, this decision is reflective of a larger trend in which companies are reevaluating their operational strategies in light of diminishing returns in an increasingly challenging business climate.
FAQ
- Why is Bed Bath & Beyond not opening stores in California? Bed Bath & Beyond has decided against opening stores in California due to heavy regulations and high operational costs in the state, which they view as a risky business environment.
- What prompted companies to relocate from California? Companies have cited high taxes, regulatory burdens, and an expensive cost of living as major factors for their decision to relocate to states with more favorable business conditions.
- How many companies have relocated from California recently? Between 2011 and 2021, 789 companies relocated their headquarters out of California, with a significant increase in relocations starting around 2017.
- Which states are popular relocation destinations for California businesses? Texas, Florida, and Arizona are among the most popular destinations, primarily due to their lack of state income tax and lower overall costs.
- What is the average cost of a home in California? The median home price in California currently stands at approximately $859,700, significantly higher than the national median of around $440,892.
Deeper Dive: News & Info About This Topic
- Tech Times: Chevron, Tesla, Oracle Lead Wave of Companies Leaving California
- Moneywise: Growing Exodus from California
- CoStar: Playboy Joins California’s Corporate Exodus
- The Center Square: Texas Corporate Relocation Trends
- Wikipedia: Corporate Tax
Author: STAFF HERE COSTA MESA WRITER
COSTA MESA STAFF WRITER The COSTA MESA STAFF WRITER represents the experienced team at HERECostaMesa.com, your go-to source for actionable local news and information in Costa Mesa, Orange County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as the OC Fair, Concerts in the Park, and Fish Fry. Our coverage extends to key organizations like the Costa Mesa Chamber of Commerce and Boys & Girls Clubs of Central Orange Coast, plus leading businesses in retail, fashion, and technology that power the local economy such as Vans, Experian, and South Coast Plaza. As part of the broader HERE network, including HEREAnaheim.com, HEREBeverlyHills.com, HERECoronado.com, HEREHollywood.com, HEREHuntingtonBeach.com, HERELongBeach.com, HERELosAngeles.com, HEREMissionViejo.com, HERESanDiego.com, and HERESantaAna.com, we provide comprehensive, credible insights into California's dynamic landscape.
