Avoid Small Business Bankruptcy With Help from Debt Settlement Attorney Wink & Wink
Small businesses can be the lifeblood of communities. They not only provide jobs and important services, but they also help add a unique, special charm to a city or small town.
Small businesses, naturally, face a lot of challenges from competitors, huge corporations, the state of the economy, and other factors outside of their control.
In fact, approximately 20% of small businesses fail within the first two years. By year five, that number goes up to 45%.
If your small business is seeing its debt far exceed its revenue, you may be in trouble.
It’s normal for every business to have some debt. Loans can help you get going and build your business up to becoming a success. And it can take a while for any business to catch on with consumers and start making a nice profit.
But if things get too out of control, you may be wondering what steps you can take to get much-needed debt relief.
If the debt becomes too much, it may be time to file for bankruptcy for your small business. A bankruptcy law firm, such as Wink & Wink of Denver, Colorado, has helped many small businesses file for bankruptcy and get help with their crippling debt.
Before then, however, there are some things you can do that can help your small business possibly avoid bankruptcy.
Hire an Accountant
An accountant doesn’t just merely handle the books and fill out spreadsheets.
No, accountants can also help with financial planning.
To achieve continual success, companies have to look ahead, and a talented accountant can help do that.
They can keep an eye on all the important metrics and numbers and help you avoid things getting too out of control. They can also spot weaknesses or areas where you could improve. They can help set financial goals and a budget for the future to keep your business around and thriving for decades.
A skilled accountant is simply crucial for any small business.
Hire a Business Lawyer
There are so many important legal situations when starting and running a business. There’s copyright, zoning, trademarks, labor laws, and many, many more.
As well, your small business will likely be signing any number of contracts or legal documents. Make a mistake with these, and it could come back to hurt you.
Plus, there’s always the risk of a lawsuit for any kind of reason. If you’re not careful, a lawsuit could be the thing to crush your small business.
A skilled business lawyer can help your small business avoid costly legal mistakes.
If your business is struggling with overwhelming debt, it’s worth taking a look at your current contracts and seeing if you can renegotiate something that will ease your debt burden.
Perhaps you have a great relationship with a vendor and they very much want to keep your business, so they’re willing to charge you less or give you longer to pay off the debt.
After all, if you go out of business, they lose your business too!
Collect Outstanding Cash
Take stock of who currently owes you money and try to collect on it.
Rather than waiting to invoice until you’ve completed the task, bill now for the portion that you’ve completed.
Your customers might also be willing to prepay for future work, especially if you offer a discount. This can get you, for example, a year’s worth of payments right now (at a slight discount) rather than monthly increments. This can be especially beneficial when your small business is in desperate need of greater revenue.
It may be necessary to reduce staff or enact pay cuts if your small business is struggling. No one wants it to come to this, but it may be essential to avoid having to file for bankruptcy.
With the staff you do still have, see if you can still increase productivity. It may mean working longer hours, but that may also mean saving your small business.
If You Do Need to File for Small Business Bankruptcy
If you’ve tried everything and your small business’s debt situation is not getting any better, it may be time to file for bankruptcy.
It’s never easy to have to make that decision, but it may be the smartest thing to do before things get much worse.
The sooner you get debt relief, the sooner you can get back on your feet.
If your small business is struggling with debt, it’s time to speak with a skilled bankruptcy law firm, such as Denver bankruptcy attorney Wink & Wink. They can review your situation and find the best solution for getting debt relief, whether that’s filing for bankruptcy or some other form of debt settlement. They’ve been helping small businesses for over a decade.