These days it has become much riskier to run a business than it was in the past. Back then, companies weren’t that numerous and as such competition was almost non-existent. But once the number of companies multiplied so did the competitors, leading to all sorts of drastic solutions to get a company out of the risk of facing bankruptcy.
Some business owners have considered borrowing money in order to add more activity and more production to the profile of their business, but with the economic recession striking so badly, many business owners have confronted with deep debts that was impossible to get rid of. Some of them simply considered as the best option to put an end to their enterprise and walk away of the debt. But before you reach to a similar conclusion, you should know that there are some things that you can do prior to closing up the business.
An idea would be to consider business recovery that comes in the form of liquidating the company and in the meanwhile open another one under a different name and different management getting hold of the suppliers and the customers. While the old business is in the process of liquidation where debts are written off, you can start fresh with another company purchasing the assets from the old one and in this way every valuable asset is preserved without having to purchase new ones.
You may as well consider creating a new plan to pay off the debt through Company Voluntary Arrangement or through invoice factoring that can generate profit.
There is one more other suggestion that comes usually as the easiest one to help you walk away from debt: business liquidation, otherwise known as CVL – Creditor’s Voluntary Liquidation. Through CVL, as a business owner you will file the court your petition through which you close the business and sell its assets in order to pay off the debt. This solution has been adopted by many business owners after resorting to various solutions to recover the business. It is a way through which you simply walk away from debt while leaving others to deal with the process of liquidation and the legalities.
While walking away from a business that is debt proves to be a viable solution, it is important that you understand the outcomes of this action. Therefore, you will have to check first with all the other options and alternatives that surely exist along the way. You will find many business owners who are in deep debt very tempted to resort to liquidation especially when the level of stress is too high and intense. But before letting stress control your actions, make sure that you have done everything that’s possible to save your business, the one you have worked so hard for into building.