Businesses can have a difficult time in the current economy. Although people may be doing better and can afford to spend, many are cautious. For businesses, this can mean trying to lower prices and fighting to make their products and services stand out. Unfortunately, some don't make enough changes or can no longer be profitable.
For businesses that are in significant debt, bankruptcy may be the only option. There are a few kinds to consider, all of which your bankruptcy attorney can discuss with you.
Is there a bankruptcy that works well for companies that don't wish to continue operations?
In many cases, companies that don't want to continue operating choose Chapter 7 bankruptcy. This is also known as a liquidation bankruptcy. It generally ends in the liquidation of the business. Any assets that remain are distributed to creditors.
Chapter 7 bankruptcy is the most common form chosen by business owners
Chapter 7 bankruptcy makes up around 80% of all filings. If you don't have the ability to repay debts and you can't afford to keep your business running, this is an option. Typically, business shut down upon filing for Chapter 7 bankruptcy. All employees, officers, directors and others are dismissed at that time.
If you're not yet sure what type of bankruptcy is best for you or whether you can or want to try to continue operating your business, you should speak frankly with your attorney. They can go over the choices you have based on the financial condition of your business and what your goals are for the future.