What is bankruptcy and business recovery and how to start over

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When bankruptcy and corporate recovery come upon your business, what should you do? This is the question asked by many entrepreneurs who open their own business but do not know how to act in the face of crises.

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According to news from Valor Econômico , in 2023, more than 2 million companies closed their doors in Brazil.

The second country in the world with entrepreneurial potential, Brazil still suffers from a high number of companies that fail. One detail in this data is that 60% of them were businesses that had been operating for less than 5 years.

The vast majority of businesses that close in the country vnpay database are micro-enterprises , with 80% of them closing in the first year.


There are many reasons why a company goes bankrupt, ranging from high debts, lack of money to invest, to poor management and low sales.

The truth is that when a situation like this occurs, the entrepreneur feels the impact, but if the dream of prospering is greater, it will be possible to get back on its feet.

But after all, how do you get back on your feet after going bankrupt? How do you recover your business and start over? That's what we'll see in this article, check it out.

What is Bankruptcy and Business Recovery?
Bankruptcy is a process that follows a business crisis, where the company is unable to pay its debts and, as a result, assets such as equity are liquidated to pay creditors.


But before bankruptcy, Brazilian legislation has other mechanisms to ensure that a business continues.

Judicial recovery is a measure that aims to prevent a company from going bankrupt. In judicial recovery, the intention is to protect both partners and customers, seeking conciliation and alternatives to save the business.

These reconciliations are agreements that the company makes with its creditors, customers and employees, in an attempt to not change the business, keeping jobs and suppliers active.

If no agreement is reached, bankruptcy itself follows, where the courts will assess the debt and assets to cover the costs and ensure that what is owed is paid.


Business recovery is a restructuring process after bankruptcy. This is a case that can occur if the entrepreneur intends to restart the business from scratch or from where they left off, but changing some strategies.

This process may include renegotiating any debts that may still exist, cutting costs, investing in technology, improving customer service, and new products and services.

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When the entrepreneur has the right guidance, business recovery can transform a failed business into a prosperous and lasting company.

Bankruptcy can be an opportunity to start over more wisely, since part of the path is already known.


Below are some tips on how to start over after bankruptcy and business recovery.

Tips for Restarting a Failed Business
When a business goes bankrupt and goes through a recovery process, the first thing to do is not to despair, take a deep breath and think about the best ways to start over.

Check out some tips to help you restart your business even better:

Accept the situation and try again.
When bankruptcy happens, it is normal to feel discouraged and have a feeling of failure, but this should be a temporary feeling, as you try to get back on your feet again.


The business may not have worked out now, but there are other opportunities from this difficult time that will make you succeed again.

Learn from your mistakes
Before starting over, list everything that went wrong and learn from those mistakes. See if you could have saved more or avoided that unnecessary debt.

Mistakes are bad at first, but they become valuable later and help us avoid similar problems in the future.

Reevaluate your business plan
Sometimes the error lies in the business plan you thought of or even in the one you didn't define.


Some strategies may not be exactly the best option at the moment for your business going forward. Adjust and consider what works and what doesn’t.

It's time to cut costs
Look for all possible ways to reduce costs to compromise the company's accounts as little as possible.

Now is not the time to spend, but to invest in things that will add value to the business, such as new products, and cut out anything that may be superfluous.

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Rebuild your business credit
Now that you have faced bankruptcy and business recovery, it is time to rebuild your credit, which at the time of the championship is quite negatively affected.


Talk to your bank and see what you can do to improve your credit score.

Sometimes these measures take some time, but they are crucial for the future of your business.

Create a new strategy
A new approach may be what you need to attract new customers and increase sales.

If you run promotions, avoid giving too many discounts, find new suppliers with more competitive prices and do your best to have lower shipping costs.


Set goals that are realistic
Set goals that are challenging but achievable.

There is no point in creating an incredible strategy and dreaming of something beyond, because it is time to get up and to do so, you need to think soberly and escape the world of dreams.

Develop a support network
When you’re starting over, it’s crucial to have a network of mentors and advisors to help you get support.

In addition to providing emotional support, these professionals can also be a great network for you, so invest in long-lasting and successful relationships.


Study and update yourself
The market is always changing and if you are not up to date with what is happening, you will possibly lose a lot of customers.

Stay up to date with industry trends and be sure to study and gain new knowledge and skills.

Stay positive
Stay positive and be resilient. This means looking at life with optimism and coming back stronger after each adversity.

Bankruptcy is a hurdle, but not the end of the road, so look to the future with confidence for better times.


Remember, bankruptcy is not the end, but rather an opportunity to start over. Change your perspective and start over with clearer, stronger strategies.