Full Video Transcript
Bankruptcy doesn't have to mean selling off all your assets and starting from scratch. Under Chapter 11 of the bankruptcy code, a business can simply reorganize itself. The goal of reorganization is to keep you in business so you can get back on your feet, rather than liquidating and shutting down. You can either begin a Chapter 11 bankruptcy voluntarily, by filing your own petition, or you can be forced into it if your creditors file an involuntary petition against you.
Whether reorganizing or liquidating is better for your business depends on your particular circumstances. Reorganization is probably a better option for businesses that are simply struggling with debt, but could continue operations if some cash could be freed up. On the other hand, if the business has bigger problems than cash flow - like loss of market share, or problems with staffing, simply reorganizing its finances may not be enough to save it.
For more information about how to avoid bankruptcy for your business, contact an attorney in your area today.