We opened a small business last year. We did okay the first few months, but once January hit our sales were less than half and debts started building up fast. We are now into May and haven't paid ANY rent this year and are behind with several suppliers. We put it up for sale hoping to get back to where we were before the business but all potentials think the lease is too expensive.
I don't want to file bankruptcy as we are not incorporated and I'd have to be personally bankrupt as well and risk losing our family home, etc. because of this.
We have a lot of children and are suffering terribly from this business nightmare.
Any ideas of what we can do? I was thinking to lower the store price dramatically to just make enough money to pay the back rent, suppliers and one of my several business loans. At least I'll be out and can get a regular job to pay down all the other business loans I have.
Please help if you know anything in this area.
2007-05-11 07:40:39 · 6 answers · asked by ds 2 in Business & Finance ➔ Small Business
First of all contact an attorney or accountant and see about getting incorporated immediately. Laws vary from state to state, but it makes no sense to start a business with your personal assets not being protected, especially if the company fails. See if there is a way to transfer the assets and liabilities you currently have to the business in order to protect your house and your families other belongings. Should you choose to close the company, negotiate the with suppliers, landlord, and people you owe business loans to. See if they can put you on a payment plan that will not negatively impact your credit. Businesses fail all the time, so creditors should be open to working with you. If you choose to "stick it out," incorporate immediately.
2007-05-11 08:02:53 · answer #1 · answered by tom m 4 · 1⤊ 0⤋
Have you considered an investment partner giving away a portion of the store as collateral.
You can advertise in your local newspaper for this type of investor.
Another possibility is you can ask family and friends and give out shares to each that want to invest. Shares can be purchased for as little as $1000.00 or $5000.00 depending on your decision as to what you wish to sell a share for.
There is a software program that you can purchase that will show you how to do this.
In both cases you would need to incorporate your business. This can be done in a short period of time, and should cost less than $200.00. I suggest you do this as soon as possible, transferring your assets and putting your business and personal life in order. It is not too late for this to happen. You will need to separate your banking accounts.
You can still file bankruptcy with your corporation if all the investors or friends fail to materialize. There is nothing in the rules as to how long a corporation has to be in business. The progression from a sole proprietary is to a corporation.
I hope this has been of some use to you, good luck.
"FIGHT ON"
2007-05-11 08:08:41 · answer #2 · answered by loanmasterone 7 · 1⤊ 0⤋
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2007-05-19 04:07:14 · answer #3 · answered by Anonymous · 0⤊ 0⤋
My friend was in this situation, he tried to sell the business but couldnt, he put piece by piece on ebay and sold everything. He was able to not file bankruptcy and pay back the suppliers.
2007-05-11 07:46:28 · answer #4 · answered by the need to know 3 · 2⤊ 0⤋
Bankruptcy does NOT mean you will lose your home. You are, often, allowed to keep some personal belongings, as well, depending on your State of residence.
Feel free to e-mail me at t_placar@yahoo.com so I can get some more information and might provide guidance.
2007-05-11 07:56:46 · answer #5 · answered by Rob B, of MD 4 · 1⤊ 1⤋
Try selling on ebay, if possible.
Prosper.com may be the best site of your life, too.
If you are sure you can make a living of this store, do everything you can to keep it open. If you don't feel it's going to be a success, it's better to sell everything and find a job.
Good luck !
2007-05-11 08:00:22 · answer #6 · answered by Anonymous · 2⤊ 1⤋