Do you ever think back to when your Ohio business was just a dream? If so, you might recall the various challenges you encountered and overcame to bring that dream to fruition. It’s hard to believe more than a decade has gone by. Like many people who built their own businesses from the ground up, you wouldn’t change a thing. All the long hours, hard work and trial and error through learning experiences paid off and you enjoyed years of continued success.
Now, you’re in a different season in life that includes financial problems. You’re definitely not the only business owner facing hard times in an unstable economy. You’d likely be hard pressed to find a business owner who hasn’t experienced financial trouble at some point. It may help to not focus so much on the fact that a financial crisis exists as to what types of options can help get things back on track. For you and many others, the answer may lie in one of various forms of bankruptcy.
Signs of financial trouble
You might say financial restoration begins first by recognizing and acknowledging that a problem exists in the first place. Sometimes, financial crises can sneak up on you; however, the following list includes telltale signs that a business may be headed for trouble:
- If you’re having difficulty restocking your inventory, it may be a sign that financial problems are looming (or already begun).
- If your empty shelves make it nearly impossible to fulfill orders for services or products you have coming in, you may want to look into ways to restructure your finances.
- In a struggling economy, people often spend less money (because they have none to spend). Decreased sales can really take a financial toll on your business.
- If you repeatedly have to borrow money to keep your business running, it’s a sure sign of financial crisis.
- When you borrow more than you make in profit, can’t pay your bills and have creditors hounding you for payments against your debt, it may be time to take immediate debt relief action.
Tens of thousands of business owners in the United States file for bankruptcy every year. Most filings are voluntary, although sometimes creditors file petitions to force business owners into bankruptcy. If you determine bankruptcy may help you overcome your current financial crisis, it’s crucial to weigh your options to find a solution that best fits your immediate needs and ultimate business goals.
Actions to take
It’s one thing to admit that things have gotten out of hand financially regarding your business. It’s quite another to know what to do about it. You may have a basic understanding of what bankruptcy is but like many business owners, you might not have a clue about which type is right for you and how to go about activating the process. The following tips might help:
- Chapter 11, Chapter 7 and Chapter 13 are three of the most common types of bankruptcy. One allows you to retain ownership of your business. Another requires complete liquidation of all assets. Each has its own regulations and eligibility requirements. By seeking clarification of each type and the laws that coincide, you can take the first step toward seeking financial restoration.
- Filing for bankruptcy protects you from foreclosure and also prohibits creditors from acting on their own to attempt to collect payment for debts. You can ask a debt relief attorney to file for bankruptcy on your behalf.
It may be best to ask employees to cut spending, improve efficiency and take pay cuts where necessary as well to start the process of overcoming your fiscal challenges.