There are many factors that can cause a successful business to experience financial difficulties. Many times, it is not the fault of the business owners or executives, but it is just a result of the economy and national trends. It may interest Kentucky readers to learn more about Sports Authority and how the corporation determined that filing for business & commercial bankruptcy was the best option based on its current financial state.
According to a recent article, Sports Authority filed for bankruptcy less than three months ago. Initially, the company planned to only close around a third of its retail stores. However, the retail giant was laden with $1.1 billion in debt, and it has apparently been unable to restructure.
When asked what caused the decline in sales, the company stated that it was late in realizing important consumer trends. As a company who built a large number of brick-and-mortar stores over the years, Sports Authority was hit especially hard by the growing popularity of online shopping. The company found itself in an extremely competitive industry, and one spokesperson from the National Sporting Goods Association pointed out that online retailers' failure to add sales tax could have also steered customers in their direction.
The decision to file for business & commercial bankruptcy can be a difficult decision for many in Kentucky. However, it can also be a way for a company that is in debt to make a fresh start or begin a new business venture when faced with serious financial challenges. No matter what circumstances a business is facing, it may be beneficial to speak with an attorney whose practice focuses on bankruptcy law. An attorney will be able to evaluate a client's unique financial situation and discuss the various forms of bankruptcy or other debt relief options that are available.
Source: USA Today, "Sports Authority shutting down with giant going-out-of-business sale", Charisse Jones, May 23, 2016