Many small business owners who file Chapter 11 bankruptcy find themselves inundated with credit card debt they accumulated in an attempt to start their business or to sustain their business during hard times. But for business owners who want to give entrepreneurship another try after they emerge from bankruptcy, approaching business credit cards and other types of debt with caution is just one of many actions that will increase their chances of success.
Below are a few more tips on how small businesses can survive and thrive after they emerge from Chapter 11 bankruptcy:
- Put your personal finances in order. Many small business owners who file for Chapter 11 bankruptcy also find that their personal finances are in shambles. A Chapter 11 bankruptcy filing for their business is often followed by a Chapter 7 or Chapter 13 bankruptcy for their personal debts. Business owners who want to increase their chances of succeeding after they emerge from bankruptcy need to make sure that they are standing on financially solid ground before they try to open another business.
- Get credible advice from experienced experts. Even the most established businesses such as Blockbuster, Tribune Co. and Chrysler sought out experts when they restructured their debts in Chapter 11 bankruptcy. They didn’t just look for experts in bankruptcy; but they also looked for professional advisors who had experience in their industry and could help them alter their business model so that they could survive after bankruptcy.
- Get proper capital before you get started. One of the biggest mistakes that entrepreneurs make is that they fail to raise enough capital for their business. Lack of capital is one of the biggest reasons business owners file for Chapter 11 bankruptcy. Businesses who successfully navigate Chapter 11 bankruptcy and emerge ready to thrive have successfully secured the bankruptcy financing they need to operate their business until they can make a profit.