Our nation’s economy makes for some tough financial calls, especially for small businesses. While bankruptcy is a last-resort option, recognize that declaring bankruptcy is not always bad and does not have to ruin your business’ financial future. In fact, for struggling business owners, bankruptcy can be an excellent strategy to clear debt and start back on the road to success.
Restaurants have faced hard times in our economy due to the tightening budgets of the recession. This puts restaurants at great risk for high debt rates and financial trouble. Even if businesses maintain a small profit, the margin is so tight that any spike in costs due to ingredients or repairs can put a company in deep debt very quickly. Filing for Chapter 7 bankruptcy may be a good option for restaurant owners, as it can result in debt elimination and fiscal freedom.
The Benefits of Filing for Bankruptcy
Acting as a lifeboat for your business recovery, bankruptcy may provide the opportunity to clear debt while continuing operations. Though the bankruptcy process differs for each business, starting it is the next step to experiencing multiple benefits:
• Continue operating your business. Filing for bankruptcy may result in the ability to continue operations. For many business owners, this is the greatest benefit as business assets are not lost.
• Increase cash flow. For sole proprietors, discharged debts often result in increased cash flow and a renewed ability to invest in business essentials.
• Eliminate personal unsecured debt. Another benefit to filing for chapter 7 bankruptcy is the elimination of unsecured debt. Discharged debt may include credit card balances, medical bills, and outstanding utility bills.
Always consult with a bankruptcy lawyer to determine the right course of action for your business. While Texas bankruptcy can help businesses get a fresh start, we know that not every company gets a second chance. Work with a skilled bankruptcy lawyer to complete the process efficiently. A clean financial slate may serve as a foundation for future company endeavors.