If you've spent a long time building a business, you're not going to lose control over it without a fight. Some firms have been known to handle financial crises with a declaration of bankruptcy, and this can feel like an end to control over the firm's fate. But that is far from the case, especially when it buys a business valuable time to reorganize its assets.
Many people in Texas may have heard the phrase Retail Apocalypse bantered about in the mainstream media. The phrase refers to the fact that 2019 was a particularly dismal one for the retail industry. Many well-known stores went out of business, including Payless and Forever 21. While remaining in business, many other stores trimmed back operations considerably. The end result was over 9,000 retail stores closing across the country, more than any other year on record.
Most would say that they have a love-hate relationship with debt. While debt is commonly incurred when individuals make large purchases or a business expands, when debt gets out of controls it can quickly become problematic. Even when a company has been able to manage their debts and liabilities, this ability can drastically alter when the market changes or a business deal goes bad. In order to overcome these financial woes, companies may have to make major decisions, such as filing for bankruptcy.
Dealing with debt is not easy. Yet, everyday millions of Americans, many of them right here in Texas, have to cope with burdensome financial circumstances. When debt becomes overwhelming, these financial burdens can make it difficult to live one's life. Debt can have a significant impact on businesses, too. It can be extremely challenging for a business to keep running when debt gets to be too much to handle. This is where a Chapter 11 bankruptcy petition may prove beneficial.
Many small businesses in Texas end up falling on hard financial times. Although some of these businesses are able to revamp their marketing tactics, delve into new markets, and expand into new product lines, others are unsuccessful in their efforts to do so. The businesses that fall into this latter category often need financial relief in order survive. They may be able to secure additional loans to help pay off some existing debts, but this strategy can leave a business spiraling deeper into a hole of debt.
Entrepreneurs in Texas take a lot of risks. Chief amongst these risks are those that are financial in nature. A business typically has to rely on some sort of financing or investment to get off the ground, and expansion typically requires additional lending. In order to make good on these debts, a business has to have a strong bottom line. Yet, in many instances, businesses see shrinking markets, diminishing margins and difficulty making ends meet.
Financial woes strike most businesses at one time or another. Sometimes, these money troubles threaten to shut a business down. However, such drastic measures aren't always necessary, as businesses can find debt relief options that allow them to continue operation.
Anytime an individual or business is struggling to stay afloat, they may consider bankruptcy as a viable option. Gigi's Cupcakes, a cupcake chain based in Texas, recently filed for Chapter 11 bankruptcy protection after facing multiple lawsuits. Gigi's apparently has multiple shops in Texas, in places such as Dallas and Fort Worth, and operates dozens of franchises all across the country.
Both individuals and companies have the option of filing for bankruptcy protection when their debts become overwhelming. Nowadays, more and more U.S. companies have had to file for bankruptcy due to major changes in the marketplace. David's Bridal, the largest bridal retailer in the country, recently filed for Chapter 11 bankruptcy protection.
Business bankruptcy options are available to help struggling businesses overcome their financial struggles. A total of 9 Sears stores will close throughout Texas as part of the company's announcement that it will file for Chapter 11 reorganization bankruptcy. The company has been experiencing declining sales and increasing debt and will close 142 stores as part of the liquidation process of some of its stores. Changes in the retail landscape, shopping habits and technology have resulted in declining sales for the retailer.