A company that made its name in the prefabricated building industry is closing its doors, according to a local business report. Dutch Barns, Inc. was founded in 1985 and has been building garages, gazebos and barns since then, but the recent economic downturn forced them to seek a Chapter 7 bankruptcy filing. Contrary to what some Michigan residents may believe, however, this will not spell the end for the company's intrepid heads.
The bankruptcy filing paperwork lists Dutch Barns' assets at roughly $50,000, but their cumulative debt at anywhere between $100,000 and $500,000. Major creditors are intending to meet in early October to discuss the specifics of how the company will be liquidated. Representatives of the company have blamed the poor economic market for the downturn in sales that resulted in the bankruptcy filing.
The company did consider filing for Chapter 11 instead, hoping to retain control of the company and restructure debt, but ultimately decided against this course of action. It was reasoned that a Chapter 11 would be too costly in the long run, and that a Chapter 7 filing would allow the owners time to locate a buyer for Dutch Barns that may help keep the company afloat under its current name. This optimism is a testament to the entrepreneurial spirit common to so many business owners in Michigan and beyond.
A Chapter 7 bankruptcy filing sounds like a dire prospect to many Michigan business owners, but as illustrated by the story of Dutch Barns, it does not have to mean the end of a business. Rather, filing for bankruptcy to satisfy creditors represents the opportunity to "clear the slate." This, in turn, allows the vibrant minds behind a company to turn to other endeavors and pursue their dreams.
Source: bizjournals.com, Dutch Barns Inc. files for Chapter 7 bankruptcy, Katie Arcieri, Sept. 18, 2013