Today’s tough and competitive economic times can be a financial challenge for any business, regardless of industry. Higher costs of operation and more options for consumers can make it a challenge for a business to remain in the black. If your company accumulates debt that begins hindering the way you conduct business, it’s time to consider a business bankruptcy to help your business succeed in the long-run. In fact, many major organizations have used a business bankruptcy to regain their financial footing. Companies that have filed for a business bankruptcy include:
- Delta airlines
- Perkins Restaurant and Bakery
- The Sharper Image
- And many more!
Trust the Guidance of a Bankruptcy Lawyer
While a personal bankruptcy has two major options (Chapter 7 or Chapter 13), there are more considerations for a business bankruptcy. Aside from having more options, business bankruptcy possibilities depend on whether you’re an entrepreneur, corporation, small business, or something in-between. Working with a Dallas bankruptcy lawyer ensures that you take all of these specifics into consideration as you apply for a business bankruptcy.
As you and your bankruptcy lawyer begin examining your business’s situation, you will be faced with the choice of reorganizing your debts and continuing operation or shutting down your business. To make the right business bankruptcy decision, you and your bankruptcy lawyer will consider:
The profitability of your business. Unless you have a strategic plan, if the business is consistently losing money before the business bankruptcy, things are unlikely to change afterwards. To determine whether to continue business or close shop, consider whether there’s any long-term profitability potential.
The assets of the business. The more assets your business has, the easier it will be to recover and continue growing your business after a business bankruptcy. However, if your liabilities are heavier than your assets, then a business bankruptcy might be the time to close the door.
Your personal liability. Work with your bankruptcy lawyer to determine whether or not you’re personally liable for business debts. This is typically a concern for entrepreneurs and sole proprietors. A bankruptcy lawyer can help protect you and your assets during the business bankruptcy process.