I have a business located in Europe that designs winter sports
equipment. Our manufacturing is handled in Asia and the products are
sold through retail stores. Currently our sales are almost entirely
through stores located in Europe but I have had interest from US
retailers as well. Therefore I have recently decided to establish a
business there to handle US sales and distribution.

Initially my main focus will be on retailers located in the Rocky
Mountain states, California/Pacific NW and New England. I also intend
to sell through on-line stores and eventually to reach other
retailers, particularly in major cities (New York, Chicago, etc).
Based on my initial focus, my intention now is to establish the
business in one of the key market states - Colorado, New Hampshire,
Utah or Vermont (or possibly California).

Obviously, one of my key decisions is where to establish the business.
Where should I incorporate? Where should the head of the business be
based (since I believe that isn't necessarily where it's legally
incorporated)?

I've done some research on the costs to incorporate in various states,
including the tax consequences. I'm no tax expert, however, and want
to do some more basic research in advance of upcoming trips and more
formal discussions with candidates and people who could provide legal
and tax advice.

Therefore, what are the high-level pros and cons of incorporating in
these states? Are there reasons why I might want to incorporate in
Delaware (or Nevada) even though I don't believe I'll generate any
significant sales in those states?

Another wrinkle relating to sales generated through physical retail
stores. Let's assume that I decide to incorporate in Vermont. Do I
also have to incorporate in other states, say where I sell to retail
stores? Does it matter if I'm using independent sales reps to sell to
those stores, sometimes in the state where the rep lives and other
times in an adjoining state? Or are there other registration
requirements in those states?

While it's not my main priority, I'm also interested to know some of
the same answers for on-line retail stores. I don't believe the
independent reps would be involved, but these "stores" can be based
anywhere (say Arizona), so I want to get some feel for the tax
consequences.

In addition, with regard to sales to retail stores, am I right that I
won't be liable for collecting sales taxes (since I'm not selling to
the end consumer)?