Since filing for Chapter 11 bankruptcy, Sears Holdings Corp. has been trying to convince suppliers to keep shipping it merchandise by touting the $300 million in financing it has secured so that its business can continue operating through the holidays, the Associated Press reported. But a growing number of manufacturers who themselves got hurt or watched others get burned by Toys ‘R’ Us’s quick demise don’t want to take a chance. Many manufacturers have already been keeping Hoffman Estates, Illinois-based Sears on a tight leash over the past few years as they watched its fortunes spiral downward. But their reluctance to work with the retailer heading into the holiday shopping season is a major blow to its survival. The fate of Sears, which also operates Kmart, depends on a critical flow of goods to its stores. “Toys ‘R’ Us was a game changer,” said Kenneth Rosen, a partner at Lowenstein Sandler, which represents several Sears’ vendors. “My clients want to work with Sears. They very much want to see Sears survive. At the same time, they don’t want to get burned twice.” Read more.
One of the worst outcomes for a business owner is having a major customer file for bankruptcy and leave behind a large unpaid account receivable. ABI's Business Creditor’s Guide to Distressed Vendors, Debt Collection and Bankruptcy provides an insider’s look into the options available to help screen a business’s customers, plan for worst-case scenarios, and, if the situation does arrive, efficiently handle the fallout.
