Bankruptcy: Learning Lessons From The Big Boys

There are many things that can cause a business to go bankrupt. If you care about the longevity of your business try to find ways to avoid bankruptcy all together. As a small business, sometimes you can learn lessons from the the big boys: major corporations.

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Many times it may seem like they have it all together but behind the scenes things are not so good. Then come to find out the companies that you thought were doing good are now going into bankruptcy. In conjunction with a bad economy & to no avail, many people are being forced into bankruptcy which causes problems in their business.

In 2008 many big companies filed for bankruptcy like Circuit City, Bally Total Fitness, Linens n’ Things etc… For 2009 many may be looking to file such as Hertz Rent-A-Car, Sprint, Macy’s, Textron, Goodyear, Chrysler etc…

Take a look at the Chrysler corporation, after trying many options to negotiate it’s debts, they have filed for bankruptcy in 2009 in an effort to reorganize & become more viable. According to the Reuters Report, Chrysler’s Chapter 11 filing is the first bankruptcy by a major U.S. automaker.

Will you be the next to file?

Sometimes bankruptcy can be caused by bad financial management or circumstances beyond the owners control. To help avoid this problem try to seek out wise financial counseling for yourself and your business.

Business bankruptcy is serious business & at some point in time in your small business you may run into financial problems. But with a little creativity and strategic planning, you can stop a small financial problem from turning into an outrageous financial crisis.

Sometimes bankruptcy serves as a relief to business owners who are financially stressed & they’re unable to find a way out or as a way to reorganize their operations in attempts to become viable after tough times.

Would reorganization or relief through bankruptcy

benefit a small business?

It is imperative for a business owner to find ways to overcome the financial problems that occur due to poor planning and lack of finance.  Then find ways to continue to run your business until it turns profitable.

At the end of the day when you take a look at it all, regardless of how good your product, how established your brand name, how valuable your plant and machinery or how dedicated and competent your staff; a negative cash flow could cause your business to crash & burn.

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