Before the recession many businesses saw expansion in their future. But now, after the recession, a number of those once thriving businesses are filing for bankruptcy in order to once again gain financial control. There is always the chance this decision to file could in turn result in those expansion plans being revisited.
Queen City Audio, Video & Appliances is one of those businesses to turn to a Chapter 11 bankruptcy. Typically with this type of filing, businesses are able to keep their doors open during the reorganization process.
As we’ve mention in previous posts, in a Chapter 11 bankruptcy, a business creates a payment plan to pay back creditors over a set time period.
According to the recent Chapter 11 filing, Queen City Audio, Video & Appliances has somewhere between 200 and 999 creditors. Liabilities are also listed as somewhere between $1 million and $10 million. When it comes to assets, the family-run business has only between zero and $50,000 — a sure sign that the company is indeed in financial hot water.
The company has been in business for 60 years, and before the 2006 recession, had hoped to expand and compete with big box stores, such as Best Buy and Target. But, it appears that the recession put a halt to those expansions. In 2006 the company opened its 14th store, but now has just seven stores in operation.
However, by filing for bankruptcy and taking care of debts, the company may find itself once again in the position to start to open more retail stores.
Source: Charlotte Observer, “TV, appliance dealer Queen City files Chapter 11 bankruptcy,” Ely Portillo, Feb. 2, 2012