Vendors

[jenbow]

so we are preparing to file Chapter 7 peronal BK in about 4 months with lots of our business debt. Our plan is to shut down company A and open company B. We have to include our vendors who provide us with glass, metal, windows, etc which is the premise of our company. I am afraid to have this conversation with our vendors..

How do vendors typically react when a business calls and tells them they are claiming BK and wiping out debt but will you sell to us under another company with cash on delivery?? Does anyone have experience with this??

Thanks all

[justasking]

How soon do you plan to open company B? You are going to have to wait until you are on the backside of bankruptcy to start a new company or the trustee may consider this fraud -- as I understand other people to say on this forum.

That being said, if you owe these companies $$$ when you file, they are going to take a hit. Are there replacement companies you can buy your supplies from when you are Co. B? If so, you may end up moving on to a new vendor and working with them.

If you have critical vendors that you need for Co. B, you may want to talk to them. While some people might think this is unethical or gray, it may be possible to agree to buy your parts at slightly higher prices down the road to help them recover some of their lost reveneus earlier. But rather than "making a deal" with them, just make it clear that you are now a higher risk and you recognize that and they may need to adjust their prices to compensate for that risk ...

Are your vendors small, local companies or big, national chains? I'd worry more about the little guys you really need than anyone else ...

HTHs