Charles M. Clapp, an experienced bankruptcy lawyer in Atlanta, has successfully worked with businesses to get them out of debt. Owning a business, large or small, is a lot of work and responsibility. Several factors cause a business to lose customers, clients, and profits, easily creating unforeseen debt that is extremely hard to pay off. Charles outlines the actions that a business can take to avoid bankruptcy.
Ways to Prevent Business Bankruptcy
Create and Stick to a Business Plan
A business plan outlines in writing a company’s objectives and strategies; any major business decision should abide by this document. This should include an organizational structure, possible setbacks, responsible solutions, and required capital to keep the business running. Every company, no matter the size, should have a business plan on paper, signed, and saved by all necessary parties (owners, lawyers, etc.). Financial crises can easily be avoided by following a documented business plan.
Keep Accurate Financial Records
A business’s influx and outflux of money (accounts receivable and accounts payable) should be constantly monitored. Inventory should be tracked, recorded, and most importantly backed up on a hard drive, in case original records somehow get lost in a fire or flood. If a company is already in the early stages of a financial crisis, there is still time to take immediate action to things turn around.
Maintain Solid Relationships with Creditors
Transparency and punctuality are best in terms of being on good terms with creditors. It’s very important, especially with senior creditors, to present accurate numbers; this can allow for negotiation and flexibility.
Management changes may be an easy fix to a company’s financial woes. Although, this may be a very hard decision to make in a family-run business. New leadership can bring fresh or different ideas on marketing, new products or services, or a healthier, better relationship with clients or customers.
A popular alternative to avoid business bankruptcy is an insolvency process called the Assignment for the Benefit of Creditors (ABC). The advantage of an ABC is that a business gets to choose who will conduct the liquidation and it brings better results for creditors with larger distributions. ABC is a faster alternative compared to traditional Chapter 7 bankruptcy.
Bankruptcy Lawyer Atlanta: Hire the Best of the Best
Reach Out to Financial and Legal Professionals
At the first signs of financial distress, it’s crucial to think about hiring a financial or legal professional who can get a company back on track. A financial or legal expert can quickly identify the severity of a problem and how far a business is from closing or liquidating.
Especially as a small business owner, it can be difficult to understand what can influence a company’s financial outcome or pitfalls.
For Georgia business owners, obtain help from the best bankruptcy lawyer Atlanta has to offer. Charles M. Clapp serves all of Georgia and has years of experience working with businesses in financial ruin. Successful financial litigation can only be achieved by hiring expert legal counsel.
If your business is on the verge of financial collapse, filing for bankruptcy may be the best choice. Debt is hard enough. Don’t make it any harder than it has to be.
Contact CMC Law today for a free bankruptcy evaluation. With the professional legal direction of Charles M. Clapp, your business will be guided in the right direction.