The In-N-Out Exodus: A Symptom of a Broader Business Migration?
A $7.32 billion decision is underway, and it’s not just about burgers. Lynsi Snyder, president and owner of the iconic In-N-Out Burger, is relocating her family from California to Tennessee, a move inextricably linked to the company’s eastward expansion. But this isn’t simply a business strategy; it’s a stark illustration of a growing trend: high-net-worth individuals and businesses voting with their feet, and leaving states perceived as increasingly hostile to both family life and economic growth.
Beyond the Golden State: Why Tennessee?
In-N-Out’s commitment to Tennessee is substantial. A $125 million East Coast headquarters is under construction in Franklin, with plans for over a dozen locations across the state. Snyder’s explanation for the move is blunt: raising a family and doing business in California has become “not easy.” This sentiment echoes a growing chorus of concerns regarding the state’s high cost of living, complex regulatory environment, and, increasingly, safety concerns. The decision to consolidate California corporate offices, closing the Irvine location by 2030 and returning to the roots in Baldwin Park, further underscores this shift.
The Rising Tide of Business Migration
In-N-Out isn’t alone. States like Texas, Florida, and North Carolina have been actively courting businesses with lower taxes, less regulation, and a more predictable business climate. This isn’t a new phenomenon, but the pace has accelerated in recent years. According to a recent report by the Tax Foundation, states with no income tax experienced significantly higher rates of economic growth than those with high income taxes. This suggests a direct correlation between tax policy and business location decisions.
The Impact of Crime on Business Decisions
The closure of In-N-Out’s Oakland location in March 2024 – the first in the company’s 77-year history – wasn’t a financial decision, but a safety one. Snyder cited “absolutely dangerous” conditions, including shootings and stabbings, as the primary reason. This incident highlights a disturbing trend: rising crime rates in some major cities are directly impacting business operations and forcing companies to reconsider their presence. Data from the California Department of Justice shows a 15.1% increase in the violent crime rate between 2018 and 2023, and Oakland was identified as the most dangerous city in the U.S. in 2023, reporting around 3,640 violent crimes per 100,000 residents. This isn’t just about property damage; it’s about the safety of employees and customers.
What Does This Mean for California?
California’s economic dominance isn’t going to disappear overnight. The state still boasts a highly skilled workforce, a thriving innovation ecosystem, and a massive consumer market. However, the continued exodus of businesses and high-net-worth individuals poses a significant threat to its long-term economic health. The state faces a critical need to address the issues driving this migration – affordability, regulation, and safety – if it wants to remain competitive.
The Future of In-N-Out: A National Brand?
While Snyder emphasizes that California will remain the “bulk” of In-N-Out’s operations, the company’s expansion into Tennessee and beyond signals a clear ambition to become a national brand. The company’s unwavering commitment to quality – never freezing ingredients and maintaining a private, non-franchised model – will be key to its success as it expands into new markets. This strategy differentiates In-N-Out Burger from its competitors and allows it to maintain a consistent brand experience.
Beyond Burgers: A Broader Economic Signal
The In-N-Out story is more than just a fast-food chain expanding its footprint. It’s a microcosm of a larger economic shift, a signal that businesses and individuals are increasingly willing to relocate in search of a more favorable environment. This trend is likely to continue, and states that fail to address the underlying issues driving this migration risk being left behind. The question isn’t whether other companies will follow In-N-Out’s lead, but when.
What are your predictions for the future of business migration in the US? Share your thoughts in the comments below!
