Subchapter V Serves Up Help for Independent Restaurateurs and Small Business Owners
Nov. 16, 2021
If you own a restaurant, you can do everything right—offer great food and service, operate in a prime location, and have a sound business plan—and still struggle to pay your debts because of conditions outside of your control, particularly during a global pandemic. Subchapter V might be the key to recovery.
Independently owned restaurants have been particularly hard hit by the effects of the pandemic on the economy. For many, the dining room might appear to be full, but behind the scenes, owners are grappling with multiple challenges. A dwindling labor supply, rising labor costs, skyrocketing food costs, and supply chain issues have pushed many small businesses, particularly independently owned restaurants, to the brink of financial disaster.
Even before the Pandemic struck, Congress recognized some of the challenges small businesses face and created the relatively new Small Business Reorganization Act (SBRA) in 2019 with an effective date of February 2020. The Act added Subchapter V of Chapter 11 of the Bankruptcy Code and was designed to streamline the reorganization process for small businesses.
Chapter 11 Subchapter V Reorganization: A Lifeline for Small Businesses
If your business is having difficulty paying your creditors, you may be able to get relief through a Chapter 11, Subchapter V bankruptcy. Large businesses have used Chapter 11 bankruptcies to reorganize for many years, but this form of bankruptcy was often too complex and expensive for many small businesses. Chapter 11 Subchapter V can be an affordable, simplified alternative for reorganizing your business debts when facing financial hardship. In most cases only a small percentage of the total debt is repaid.
Although Congress didn’t foresee the financial crisis from the pandemic when the new law went into effect, it has helped many businesses rehabilitate their finances and reorganize to keep their business intact and save jobs.
Branson Law Can Assist You with Subchapter V to Help You Save Your Business
Branson Law has proudly filed approximately 30% of all of the Subchapter V bankruptcies that have been filed in the Middle District of Florida, Orlando Division.
Attorney Jeff Ainsworth at Branson Law immediately recognized the benefits of Subchapter V for his clients who are small business owners. He has effectively used Subchapter V to assist many of his clients with reorganizing their debts while keeping fees and costs down. His clients have included restaurants, physicians, construction companies, liquor stores, daycares, and many other types of small businesses. We can also help business owners with complex financial situations that include multiple businesses. If your business is facing financial hardship, contact Jeff Ainsworth at Branson Law today to see if you could benefit from a Subchapter V bankruptcy.