Challenges Unique to Small Business Owners Facing Bankruptcy

If you’re a small business owner in Detroit or elsewhere in Michigan, then you know you have more obstacles to clear than larger companies in remaining solvent.

And with the economy being especially unpredictable right now, there’s an increase in small business owners facing bankruptcy.

This is when small business owners in Detroit and throughout Michigan must consult with experienced bankruptcy attorneys like the kind at Gold Lange Majoros & Smalarz P.C. to help them determine the next steps.

Factors Leading to Small Business Owners Facing Bankruptcy

With the convenience offered by big box stores and massive internet entities, running a small business is more demanding than ever. Multiple reasons can lead small business owners to consider bankruptcy as a solution for their faltering business. 

1. Difficulty Landing Reliable Employees

Finding good employees who can succeed with a small business is a constant challenge. While large companies can afford to offer positions that focus on just one task, a small business owner may have to search for candidates who can handle multiple tasks. They must also possess the personality required to be in a small business environment and be flexible enough to handle change.

In addition, large companies can offer benefits packages that include health insurance and other perks. This is much more challenging for a small business owner in Detroit, or anywhere else.

2. Ineffective Marketing

Good marketing can make or break a company. But it can be cost-prohibitive for many small companies. And relying on word-of-mouth is a slow game. There are many opportunities afforded by the internet for marketing purposes. But there are challenges for small business owners face in this area too.

For example, having a website offers online presence. But if it’s not strong in search engine optimization (SEO) and/or not utilizing responsive design, it’s merely an online billboard that will do little to drive business. This means hiring an SEO professional to assist with this. Presence on social media platforms is also important, as long as it’s done correctly. And keeping up with comments on user review sites like Yelp is also crucial. Large companies have entire departments committed to just online activities.

3. Maintaining Quality During Growth

There’s no feeling so heady for a small business owner as celebrating landing a new client. Especially if it’s a significant one. This means potential growth and success. But it also means increased demands and new struggles in keeping up with the workflow. For small businesses, this can equate to working longer hours or cutting corners. The former can lead to burnout, while the latter could push customers away. Finding that happy medium is much easier for large companies with a massive staff and a department created just for new business acquisitions.

4. Lack of Time

As a small business owner in Detroit or Michigan, you’ve probably been both working on your business as well as IN it. Where large companies have separate entities to handle vendors and billing, filing paperwork, and taking phone calls, small business owners are often tasked with doing all of these while still attempting to create business plans and win new business. Sometimes, there just isn’t enough time in the day.

5. Issues With Funds and Cash Flow

Of course, without a steady cash flow, it’s difficult to run any company. For large companies, however, losing a client typically means there’s still enough cash flow to pay employees and keep the lights on. For small companies, losing a client or even a late payment from one could come down to the business owner sacrificing his or her salary to keep the company afloat. And this is only sustainable for so long.

Are You a Small Business Owner Considering Bankruptcy?

If your small business in Detroit or Michigan is struggling, you could get a fresh start through a Chapter 7, Chapter 11, or Chapter 13 bankruptcy.

Our skilled bankruptcy attorneys have years of experience helping small business owners facing bankruptcy to find solutions that work for them.

So don’t hesitate to reach out to us at 248-462-7698 to schedule a free initial consultation. You can also connect using our email form. We can help.