The recession has led to many once thriving businesses to seek out bankruptcy protection in order to either reorganize or discharge debts that have accumulated over the years.
Last week, one furniture manufacturing and retail business realized that the original plan to reorganize debts under a Chapter 11 bankruptcy was just not plausible and has since converted that filing to a Chapter 7 bankruptcy. The plan going forward is to liquidate all of the company's assets.
Crawford Furniture Mfg., which manufactured and sold furniture out retail stores and to other retailers around the country, originally filed for a Chapter 11 bankruptcy in August. At the time, the plan was to reorganize the manufacturing and retail operations. However, since then the company realized this was not the best course of action and after asking a judge for approval, the filing was converted to a Chapter 7 bankruptcy.
It is unknown the exact amount of the company's assets, but the original filing lists more than $10 million. Going forward, the plan is for remaining furniture inventory to be sold at a public sale. Additional assets, including commercial real estate, materials and machinery will also be sold next month.
This conversion to Chapter 7 comes five months after close to 85 employees lost their jobs when five of the company's retail locations were closed.
Back when those locations were closed, an executive blamed the recession for the company's financial misfortunes, which is a common theme among many businesses that have closed in recent years.
Source: Furniture Today, "Crawford Furniture Mfg. to liquidate its assets," Thomas Russell, March 15, 2012