Baskets in Bankruptcy

July 30, 2008 · Filed Under Insurance and Liability · Comment

It’s truly heartbreaking when your gift basket business does not work out as planned to the point where you cease business and liquidate all assets.

That’s what happened to a Minneapolis-based designer. Notice of her Chapter 7 bankruptcy appeared in StarTribune.com.

Information about the court proceedings is No. 5 on the page, just above the St. Paul-area notices.

There is no way, even through a time line, to trace how a firm ends up in bankruptcy. You may think the company overextended itself, believing they’d have more sales than occurred. You may also feel that the owner didn’t plan well or keep orderly records. Much more can happen.

Economies change for the worse, closing businesses that were once regular clients.

An accountant or employee may embezzle money.

A creditor might not pay a substantial bill, ever.

A large purchase order may be canceled.

This and more is the chance we take as business owners. Once you realize that the tide will not turn your way, it’s time to take action, and that action may be to close shop. You’ll have sleepless nights, and you may cry.

But it’s okay to let go. You enjoyed your time in the business and move on to something else that fulfills your life, whether working for someone else or starting a new business in the coming years. Somehow, the shred gets into our blood and doesn’t let go. That’s okay, too.

This gift basket company has just under $240,000 in assets for disposal, according to newspaper records. I certainly wish her well.

Would you file for bankruptcy if your assets substantially outweighed your liabilities?