Points to Consider Whilst Liquidating a Business
Posted at by ifydcat on category FinanceLiquidating a business is becoming a regular theme within this current economic climate. Essentially it is the process whereby assets are converted into cash so that debts can be paid off, or perhaps, you simply want to retire or change location, which will free up cash. But regardless of reasoning, there are a few things that can help inform you onto a better decision so that liquidation can be easily achieved.
The first thing that you need to deliberate over is the valuing process of your current stock, including; furniture, fixtures, equipment and all other items that are no longer required. The depreciation affect will take effect over older items, so its important to gain a fair valuation by using your CPA which can help inform your decision.
Another consideration is to stop making any purchases from your current suppliers – quite an obvious suggestions considering this will be counterproductive in your attempts to liquidise assets.
Continually on the supplier theme, items that are laying idol should be returned. By doing this, you can perhaps get the original value if there were special terms within the contracts you agreed.
Then arrange to sell assets – now the value you receive is dependant on the amount of time you spend during the liquidating process. Realistically it is certainly feasible for you to get the full market value for your entire inventory if you allocate enough time to decline derisory offers. Whereas if you it needs to be a relatively quick selling, buyers can easily demand to pay less due to the circumstances.
Regardless of what method you chose, it will be important to protect assets. That is, disgruntled staff or clients will maybe consider taking some of your assets as compensation which they deem fair – so install a camera system or collect keys of those particular may be the best option to prevent this from happening.
Learn how you can prepare for business liquidation by taking business liquidation. Visit Business Debt Advisor’s site for further advice and support.