Business Case Study
In recent days, many leaders have spoken of partially reopening the economy on May 1st. What does this mean for small business owners?
I had a discussion with the owner of a local restaurant and bar in Pinellas County. March and April is a busy time for them, so they lost a lot of revenue, but they still have bills to pay, especially rent.
The landlord is breathing down their neck and threatening to evict them. Because businesses are exempt from the new anti-foreclosure and eviction orders now in place in Florida, the landlord has the right to evict them and doesn’t have to negotiate, even in the current crisis. What does a business do now?
First, this business owner applied for the Paycheck Protection Program and the Small Business Loans offered under the new Stimulus Bill, which will help pay the staff and give them some seed money to reopen.
Since this business owes both rent to the landlord and money to their suppliers, and wants to use the loan money to reopen the business, their best option is to file a Small Business Chapter 11 Bankruptcy. This will allow them to reopen their business, force negotiations with the landlord, keep their relationship open with suppliers, and reschedule their debts so that they can stay in business.
Without this option, the business would not be able to reopen and stands at the mercy of the landlord. Through this path, the business can safely reopen and move forward into the future.
If you have any questions about your options as a business in the coming months, give us a call at 727-729-2719. We have over a decade’s experience helping businesses survive financial issues. We will help you.