Michigan business owners know that expanding operations can be a good and necessary step to maintain their position in the marketplace and even grow. Conducting an expansion can be a bit of a gamble: The rewards can be big, but an expansion can also be harmful if the timing or execution isn't right. One area business seems to have had this kind of experience.
Michigan business owners take pride in their work in building a successful business. However, sometimes, certain measures must be taken in order to prevent a company from falling under. Bankruptcy is one such measure that many business owners choose to take in order to restructure their businesses and keep the company alive. With bankruptcy, there are many laws involved and business owners often have a number of options available to them.
In order to be successful, businesses need to turn a profit. In some cases, businesses are profitable because they fill a void in a specific niche market. For these businesses, they thrive because they are doing something that no other businesses has been capable of doing. However, when other businesses move into the niche, it can be harder for the original business to compete.
In our last Wayne County bankruptcy law blog post, we made a reference to the term "debtor in possession." Let's take a little closer look at the meaning of debtor in possession according to the U.S. Courts website. The following is intended not as specific legal advice, but simply as general information.
This blog has discussed commercial bankruptcy in a number of recent posts on. In particular, in a post from two weeks ago, we highlighted how the automatic stay associated with Chapter 11 bankruptcy helped one business owner renegotiate some debts that he might not have been able to otherwise. Chapter 11 is often referred to as a reorganization bankruptcy, but our Wayne County readers may have some questions about what exactly this means for them. Following is some general information regarding that question, which should not be interpreted as specific legal advice.
For Wayne County business owners, the idea of filing for bankruptcy may seem antithetical to the very entrepreneurial spirit that drives them. One wants to hold on, keep fighting even in the face of overwhelming debt. However, for many, business bankruptcy is just the opposite of giving up the fight: it's a last-minute tactic that can turn the game around, sometimes even faster than expected.
We've discussed a number of business bankruptcy cases in recent weeks on our Wayne County bankruptcy law blog. The latest involved a national restaurant chain emerging successfully from Chapter 11. However, one recent example of a commercial bankruptcy right here in Michigan highlights the importance of a sound reorganization plan when filing for Chapter 11, and the consequences of failing to develop one in the time allotted.
Many Wayne County residents understand that it is possible to rebuild one's finances and become stable - even successful - after filing for bankruptcy. The same is true for businesses that file for bankruptcy under Chapter 11. Unlike Chapter 7 which means the end of the business and liquidation of assets, Chapter 11 business bankruptcy allows companies to reorganize and continue operating without the burden of debt weighing them down.
A judge overseeing the bankruptcy process of discount clothing retailer Loehmann's has approved the sale of the company's inventory. Liquidators already bid on the inventory at an auction and the winner offered to pay 29.8 percent of the total value of the inventory, which is estimated to be worth about $51 million.
Any person may find him- or herself needing to file for bankruptcy for various reasons. In a tough business environment many business must also need to reorganize or liquidate assets.