There are many established Tennessee companies that seek bankruptcy protection, for a variety of reasons. The decision to file may have nothing to do with poor business decisions or poor financial management. Instead, it may simply be a case of rising costs and diminished sales. In those situations, business bankruptcy offers debt relief and an opportunity to get a fresh start. Recently, Borders Book Store filed for bankruptcy relief after failing to find any buyers for the business.
As part of the process of filing for business bankruptcy, Borders necessarily closed stores and operations. Customers at the bookstores across the country looked for bargains, with prices discounted to as much as 90 percent of the listed price. However, the closing of Borders is not just about shutting down bookstores. It is about closing a chapter on the lifestyle of a communities, where neighbors came together for weekly readings, chess games and to buy books.
A commercial bankruptcy seeking liquidation requires the conversion of all assets and property to cash, including furniture, equipment and even the books. These funds are then used to pay existing creditors to ensure that as much of the outstanding debts are settled as possible. Many fixtures end up being sold for pennies on the dollar.
By contrast, there are Tennessee businesses that are booming as well. Unfortunately, times have changed and the book business has become more competitive, particularly with e-books and related reading devices storming the market. While the country fights to stave off another recession, those companies that fall victim to financial circumstances beyond their control may find that a business bankruptcy offers the best solution.
Source: WYTV, "Doors Closing On Borders in Niles," Sept. 13, 2011