Starting and successfully running a business can be challenging for a variety of reasons. Securing capital, managing supply chains, and maintaining successful employees can all be difficult. With adequate planning, many of these matters can be addressed. Yet, no matter how much a business plans for its future, there are always unexpected issues that arise. Increased competition, breached contracts and a changing market can all lead to unfavorable changes for a business. When this happens, a business needs to carefully consider its options with regard to its financial future.
One well-known business found here in Texas, Gander Mountain, has done that and found that filing for Chapter 11 bankruptcy is in its best interests. The store will be closing 10 of its 22 Texas stores, as well as 22 other stores across the country. Although the business plans to keep its other stores operational, it will start soliciting bids for its closing stores in May.
A recent report has documented the financial woes the company has been seeing. Reuters reported that Gander Mountain is subject to a $30 million loan and has revolving credit lines that total $525 million. Although sporting goods stores in general have been seeing difficulties, with Sports Authority and others closing many of their stores, many look to the merger between Bass Pro Shops and Cabela’s as a contributing factor to Gander Mountain’s downfall.
Filing for bankruptcy can be a great way for a business to protect itself when facing overwhelming financial difficulties. The process may help a business retain some assets and emerge from bankruptcy with a firm financial footing to continue its operations. The process can be confusing, though, and those who fail to abide by the federal laws pertaining to it may find themselves with a failed bankruptcy. Therefore, those businesses considering bankruptcy may want to discuss the matter with a qualified Texas bankruptcy attorney.
Source: The Wall Street Journal, “Gander Mountain Files for Chapter 11,” March 10, 2017