A long-standing tourist attraction on a quaint New England main street is closing up shop, according to local business news. LaFlamme’s, a furniture store in a rural part of a nearby state, has been a mainstay of the local business scene for some 50 years. However, its ownership has decided to file for Chapter 7 bankruptcy, citing unmanageable debt. Connecticut business owners may recognize this as a difficult but ultimately positive step for the owners to take to ensure their ability to compete effectively in the free market.
LaFlamme’s has specialized in furniture sales for many years, but by the last quarter of 2017, the company had filed for Chapter 11 bankruptcy protection. A difficult sales period in early January, put down to poor weather conditions and a lack of local traffic by management, forced company ownership to consider other options. Ultimately, the decision was made to switch the filing to Chapter 7 liquidation.
Chapter 7 works by assigning a court-appointed trustee to oversee an accounting of the company’s assets. Some of these assets will be liquidated to help pay down the company’s $1.5 million in debt. Some of this debt may also be formally discharged by the court. In either case, the debts owed by the company will be settled.
While Chapter 7 bankruptcy sounds like an extreme measure for a company owner to take, some Connecticut residents already understand the value of the process. By liquidating assets and erasing some existing debt, the company’s owners can banish the spectre of debt from their future plans and return to a more stable financial platform. This will allow them to re-enter the market on a competitive, rather than financially hampered, footing.
Source: benningtonbanner.com, “LaFlamme’s Closes, Enters Chapter 7 Bankruptcy“, Ed Damon, Jan. 12, 2018