Extreme Measures To Save Your Business From Bankruptcy
Cash crunches can happen to any business and the most important thing you’ll need to do is avoid stress and worrying too much. It’s not that easy but then again, maintaining your sanity will be your only way out of the situation. You need a clear head to make split-second decisions. These are the decisions that will either make or break your business because hey, there’s always a light at the end of the tunnel!
The thing is, you don’t want to make other mistakes along the way in the process of reviving your already troubled company. No one knows your business well enough and not everyone will offer you, valid counsel. It would suit your best to liaise with business owners who’ve experienced the same difficulties and borrow insightful tips on how you can turnaround your business from further ruin. To guide you, below are extreme measures to save your business from bankruptcy.
1. File for Bankruptcy
This is, of course, one of the extreme measures you can take to save your business from bankruptcy. It should make a lot of sense to start with this option as it will help to protect your business from your creditors. If your business is faced with so many commitments and overwhelming debt obligations, the last thing you want is having creditors knock on your doors. This will be like adding salt to an injury. Now, filing for bankruptcy is one of the most extreme measures you can take and the smartest decisions you’ll ever make for your business. But before you take this step, it’s important that you learn how it works. Bankruptcy is a lifeline for businesses and companies drowning in debt. You’ll need to petition the court to release you from the debt liabilities. This means that you need to hire a bankruptcy and insolvency attorney when filing for chapter 7 bankruptcy. This is somewhat a tricky process but in essence, it will give you some leeway into strategizing and more time to consolidate your finances. However, this doesn’t mean that you’ll go scot-free and not pay your debts. This just means that you have a second chance to make things right!
2. Dispose of Any Assets That You Can Afford To Lose
Finances account for the number one reason why most businesses fall into bankruptcy. Businesses need money to run because you have to pay your rent, utility bills, employees, and production costs to mention but a few. All these require money and there’ll be no use of holding on to assets that can offer you a way out. Having an asset portfolio in itself isn’t bad, but these assets will not pay the aforementioned expenses. So take stock of what you have both personal and business assets and determine what needs to go. This will make you an extra buck that can be channeled back into the business and hopefully help you to turn things around.
3. Find A Way to Amend Some Contracts
Signed contracts are watertight and some cannot be amended. But as you may already know, circumstances and situations in business can change and there are so many factors that can contribute towards this happening. This, therefore, means that the deals and contracts you signed when things were going your way could be conflicting with your current situation. This will make it harder for you to honor your word and in fulfilling your promises. If the signed contracts are no longer working for you, then you can always find ways to negotiate for better deals. Your situation isn’t permanent and you’ll soon bounce back and sort things out with your suppliers and vendors. But in the meantime, renegotiate any contract that is causing you a lot of pressure.
4. Revisit Your Business Strategies and Budget
It could be that you started your business without having mapped out a clear strategy and it’s now causing you monumental pressure from all sides. The thing is, it’s never easy to create a business strategy. It’s actually one of the most difficult aspects most business owners face. It could also mean that your budget needs some revisions. It’s imperative to always come back and analyze areas in your business plan that could be improved. If it’s issued to do with the markets, then find aggressive ways to promote your brand and products. You may also seek help from financial advisors to help you with your budget planning and allocation. Below are reasons why you should keep updating your business plan:
- Whenever you require financing
- When there are significant changes in the market
- When going through a transition in management
- when your old plan fails to deliver results
Any business can go through financial challenges. Nevertheless, it’s how you deal with the situation that will make the difference. Your attitude will have an impact on the immediate decisions you make and it’s what will help in driving the right actions. You can always turnaround your business even when on the brink of bankruptcy because come to think about it, no situation is permanent!