A government-enforced shutdown of operations has led the nation's largest producer of organic peanut butter to shut its doors, according to local business sources. The governing board of Sunland, Inc., known to Michigan residents for its massive recalls last year, filed for Chapter 7 bankruptcy the week of Oct. 9. It is hoped that "clearing the slate" with former creditors will help the owners of the company move forward in a positive fiscal direction.
According to the bankruptcy paperwork, the company had an estimated $10 million to $50 million in assets, stacked against anywhere between $50 million and $100 million in debt spread out between 1,000-5,000 creditors. The Mayor of the city in which Sunland was based bemoaned the loss of a business described as being a positive benefit to the community. The liquidation means the business has shut its doors and is in the process of selling off all assets to pay down debt.
Representatives of Sunland blame an unfortunate salmonella outbreak last year that forced the company to recall nearly a hundred different products from the market and shut down their production facility for an extended period of time. The company never recovered from the fiscal blow dealt by that setback. Despite reopening the plant in March, sales were not high enough to compensate for the loss.
A Chapter 7 bankruptcy filing can be difficult for a business owner to accept, as many Michigan residents are aware. However, all is not lost for a business owner forced to liquidate a company. Paying off existing debt can help protect the owner's personal finances and prime him or her to re-enter the business market without debt dragging them down.
Source: abqjournal.com, Sunland ceases operations, files Chapter 7 bankruptcy, No author, Oct. 9, 2013