Credit card processing if business closes

[rebuilt]

Playing Devil's avocate still about the possibility of my business not making it. I own a business where people pay for services in advance, and then use their services when they come in. I am doing my best to keep the businesses afloat, but if it gets to the point where you need to shut your doors, what happens if people paid for services (using a gym or something as an example), and then you close, and they dispute the charge with the cc company, but there is no money left in our accounts left for the cc company to pay the people back.

I don't want to be some lowlife that takes people's money, then shuts their doors, but until I get close to knowing if and when the business may or may not close, I can't just stop accepting income, or it definitely will close. I am concerned, even more so, because I believe the cc companies make you sign a personal guarantee when signing on to take payments, and I can't recall if I am the one that made that personal guarantee, or if someone else involved did, and I don't want the possible business failure to affect them.

Thanks for all of your advice everyone

[Flamingo]

Review the small business laws of your state and if you have CPA who does your books or tax work, consult with him/her. Also do yourself a favor and get a consultation with a BK lawyer who handles small businesses to find out what you could face if your business goes under. If you are scared now, you are having problems...

[justasking]

Well, the moral thing to do to be able to look yourself in the mirror would be to close the doors if you know you won't make it and stop taking people's money for work / services you cannot deliver.

I know my Merchant Account has a personal guarantee ... would be yours does as well even if you cannot find your contract.

What is the reason you'd have to close? Personal finances? Costs? Is there a way to ensure that you only take $$$ for services you know you can deliver? What ways can you control / reduce costs to ensure you can survive??

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Just not sure of if we are going to make it or not. It is a seasonal business, that can turn around on a dime, and has in years passed. The industry took some major hits this summer, from taxes, and negative press. So competitors may be in a worse spot than we are in. There will be closures for sure, it's just who can hold on longest. And based on recent events and information, I know a couple of competitors are certainly hanging on by a thread (as I feel we may be soon). I guess the only way to really handle it is if we get to the point that we know, we only take money for that day's service, and call people who have prepaid services to let them know how long they will have to use their service. I want to do the moral thing, but then other things come into play. Once people know we are closing, employees won't show up, or care, etc. and these businesses are far from where I live, to where I can't just run down there.

A couple of years ago, it made sense, as there were multiple purposes for these scattered locations based on a separate business we have (which is in the same industry, but is really hurting) so we were always driving by them. But now, one or more are far away headaches.

[justasking]

Well, if you want to be creative -- there are inexpensive and free ways to remind people to use their services sooner rather than later ... you wouldn't make more $$$ right now but those obligations on the back side would disappear ... why not brainstorm / explore / implement some of those?

And some employees will always surprise you ... don't just automatically write people off.

Do the best you can and you may be the one that survives :-) We've all made it this far, after all ... channel the worries into positive energy and make that lemonade! LOL

But seriously, don't let your mental thoughts be the thing that takes you down ... worries cost us a lot from a stress point of view. Do what you can and let the rest go ...

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Great advice. But the same advice I keep getting from a therapist, family members, friends, etc. Just such a type A person who always was working on one successful project or another, and feel paralyzed by the lack of recent success (and more than likely upcoming failures in several areas of my life). I see people who just wing it, and let go of stuff they can't control. I just have a new fear enter, every time another one leaves, due to the volume of things and workload I am faced with.

It's being burnt out on top of everything else that is not helpful either.

[justasking]

Yes it is burnout ... mental is the worst and it is *one thing* we do have control over!!

So 1) take care of yourself and 2) don't waste your precious mental energy on fears and rumination -- they only drain you. 3) deal with your reality, not your fears -- reality is tough enough! LOL 4) get your support system in place and use it to take care of yourself

This is going to be the thing that helps us businesses that have survived this long to make it ... we are all tired, digusted, exhausted, tired of fighting the cash flow battle, etc. etc. ... BUT we are almost there!

It's like the 23rd mile on the marathon ... do what you have to do to get to the finish line and you can be the business owner that survived and prospered.

Seriously people -- your mental attitude is half the battle sometimes!

So -- name five things you are grateful for right now :-)

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I really needed someone to help me through this morning. Thank you.

1.) My mom
2.) The roof over my head (currently Mom's, but doesn't matter as I am an only child, and she is single, and we have become sooooo much closer over this past year)
3.) My health
4.) My dogs
5.) My education (Bachelors Business), and creativitiy that will hopefully help me through this, or whatever comes next.

Cashflow is the thing. Right there you hit it. I am used to having a cushion, and there just hasn't been one. So every month, somehow something hits that helps to cover the expenses. I just haven't paid myself any type of paycheck in forever, and wish there was some type of help business owners that actually do employ people for a long time could get if things went south. As happy as I am for people to get their unemployment extensions, after all of this, and all of the people I have employed over the years, if I go under, there is no safety net, and it stinks.

[justasking]

Yep, totally ... cash is king! And yeah, it's been tight here too. We've even had to talk about temporary furloughs of staff if we run out (we have employees too). And you know, it would suck ... but I have to take care of us and the business first. If I don't, there is no job for them to come back to.

And our paychecks have been as low as possible to pay bills, even go into a little more personal debt. But we believe it was worth it and believe we will crawl out of this nasty recession.

I have three Springers ... what type of dogs do you have? I love that they sit under my desk in the afternoon and nap. Yeah -- they come to our office and I love that too!

My grateful things today:
Running water
Our homestead that has both house and business on it so no travel to work
Raspberries in my garden that I need to make into freezer jam today
A good book that helps me relax and go into another world
A beautiful day to take my dogs for a walk

Take care and enjoy your weekend!!