Most textbooks on small business and entrepreneurship emphasize, quite correctly, the benefits and joys of owning and operating one’s own business. However, they often neglect to cover many of the challenges of continuing to operate a business successfully—the icebergs that can sink a business. The first half of this chapter covers one of the biggest icebergs: a natural or a man-made disaster and the disaster planning that should precede it. Being able to anticipate a disaster will contribute significantly to its effective handling so that a business can survive.
- Describe four situations in which a business owner may choose to get out of the business.
- Explain exit strategies that a small business can consider.
- Explain the difference between Chapter 11, and a Chapter 7 Bankruptcy. Assuming you were having problems meeting your debt obligation, which one would you consider using should your Hot Dog business need to file? Explain why?
- What are the alternatives to Bankruptcy?
- After running your Hot Dog Truck business for some time, you have decided to sell the business to one of your employees. What are the pros and cons of a friendly buyout?
- The Small Business Administration (SBA) offers Physical Damage Loans. (Links to an external site.) A Category 5 Hurricane has just blown over the campus where you have your Hot Dog Truck, it has been destroyed. You plan on looking into the SBA’s loan requirements.
1. What is the Eligibility for this type of Disaster Loan?
2. How can the loan proceeds be used?
3. What is the Term, Maturity and Collateral for such loans?
7. Your Hot Dog Truck business already has liability insurance, but what kind of insurance policy might have protected you from lost revenue as the result of having your business shut down for a period of time.
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