I have just met with a client that is throwing in the towel. They are starting to determine the process of how their business will be shut down.
This will have to be a difficult process with multi prongs of attack. There are employees that will need to be terminated, there is income that is outstanding that will need to be collected. They also have the outstanding bills that need to get paid. The one issue that they are attempting to avoid is bankruptcy.
The business has never been overly profitable, but of late there have been nothing but losses. I had recommended that they attempt to operate within a much smaller framework. But the business model unfortunately has a need for more bodies to generate revenue. Making it difficult to limit payroll and succeed.
To further complicate the matter there are also the personal guarantees on the leases. This is where the bankruptcy may become the only option. The bankruptcy itself also comes with other issues.
Closing a business takes time and energy. It is also more difficult because if the business was less than successful, you may have difficulties getting the energy needed to go through the process, because you are already exhausted. There is a certain adrenalin rush that comes with the starting of a business. This is definitely not there for the closing of it.
This is a difficult time for everyone, myself included. I also have invested time and energy in my client’s businesses. I am pleased when they succeed and I also feel the sting of their failures.