Postbankruptcy profitability in your business plan
On behalf of Furr & Cohen, P.A. posted in Chapter 11 on Monday, August 1, 2016.
Can you plan for profitability after bankruptcy for your business? Most of the time, a company that is weighed down with heavy debts may find things as mundane as overhead expenses to be too burdensome. At that point, the company may have only a few real options: to close its doors and face possible lawsuits from creditors, close its doors, liquidate assets and file bankruptcy or persist at business as usual with a repayment plan as well as a plan for eventual profitability.
In the latter plan, the business can voluntarily petition for Chapter 11 bankruptcy or a creditor can file the petition, in which case the filing would be involuntary. The beauty of Chapter 11 is that businesses can often continue as usual while they figure out a repayment plan for debts that are usually substantially reduced through negotiations. As long as the plan complies with the law and is reasonable, it will likely be approved by the court. Going forward, it is your responsibility to stick to the plan and not fall behind. That’s why it’s important to ensure the plan you make is one you can absolutely keep.
Also, once the petition is filed, there is a stay placed upon creditor collection efforts and unless that stay is modified, your business is given a time of reprieve with which to save money and reorganize debts, cut costs and strategize in an effort to keep the doors open.
If your business is in trouble and you can’t find a way to make ends meet without doing something drastic, you may benefit from sitting down with a Florida bankruptcy attorney. You may find that the options presented to you through Chapter 11 are far more favorable than those remaining should you forego petitioning for bankruptcy.