Our Escondido readers may have seen previous posts here that discuss the ever-present need for businesses in today's economy to adapt to changing customer preferences and behaviors. There have been plenty of companies that have cited the changing dynamics of the economy when filing for Chapter 11 bankruptcy. The Internet, of course, is a significant catalyst for change in today's retail sales market.
According to a recent report, some experts are even expecting an increase in the number of bankruptcy filings from retail businesses in 2016. Not only that, those retail businesses that choose to file for bankruptcy may be more apt to file for Chapter 7 bankruptcy instead of Chapter 11 bankruptcy -- "throwing in the towel," you could say, instead of working through a Chapter 11 bankruptcy reorganization.
A business decision to file for bankruptcy is difficult, as in many cases there will be quite a few jobs at risk, and the overall financial health of the company may be beyond saving. Business leaders who come to this conclusion may consider filing for Chapter 7 bankruptcy, liquidating assets and shutting down the company.
However, the decision to pursue a Chapter 11 bankruptcy filing can take courage. The process can oftentimes be arduous, with difficult decisions regarding the reorganization of the company and debt obligations to be made. Retail businesses in the Escondido area that may be on the brink of a bankruptcy filing may need to get more information about their options in a Chapter 11 bankruptcy, or whether or not a Chapter 7 bankruptcy filing is the best option.
Source: Apparel, "Retail Bankruptcies on the Rise: How to Avoid Becoming A Statistic," Robert Marticello, Feb. 24, 2016