Trickling Springs Creamery Business Collapse

[mike]

That is sad.

My employer had customers that close up shop seemingly overnight. They place orders with their distributors and vendors so the employees wouldn't figure out what's happening. Then at the end of their last day, they tell their employees its over, and those orders get cancelled. That kind of decision weighs on everyone.

That reminds me of another closure I noticed yesterday. There are probably reasons why a business chooses an abrupt rather than a pre-announced closure, but it sure doesn't sit well with customers and employees.

https://www.facebook.com/permalink.php? ... 7496358033

[temporal1]

That is sad.

My employer had customers that close up shop seemingly overnight. They place orders with their distributors and vendors so the employees wouldn't figure out what's happening. Then at the end of their last day, they tell their employees its over, and those orders get cancelled. That kind of decision weighs on everyone.

That reminds me of another closure I noticed yesterday. There are probably reasons why a business chooses an abrupt rather than a pre-announced closure, but it sure doesn't sit well with customers and employees.

https://www.facebook.com/permalink.php? ... 7496358033

The question i can’t shake is: Were there no buyers interested in taking over these popular+long-established businesses?
Is there some tax benefit in just abruptly closing?

What’s going on?

i know of 2 small sandwich shops that closed, one sold without closing, another closed, then was purchased months later and reopened under the same name+menu. Isolated cases.

[mike]

That is sad.

My employer had customers that close up shop seemingly overnight. They place orders with their distributors and vendors so the employees wouldn't figure out what's happening. Then at the end of their last day, they tell their employees its over, and those orders get cancelled. That kind of decision weighs on everyone.

That reminds me of another closure I noticed yesterday. There are probably reasons why a business chooses an abrupt rather than a pre-announced closure, but it sure doesn't sit well with customers and employees.

https://www.facebook.com/permalink.php? ... 7496358033

The question i can’t shake is: Were there no buyers interested in taking over these popular+long-established businesses?
Is there some tax benefit in just abruptly closing?

What’s going on?

i know of 2 small sandwich shops that closed, one sold without closing, another closed, then was purchased months later and reopened under the same name+menu. Isolated cases.

I can only guess. One of the restaurants, the best of the local ones I mentioned, is a steakhouse in a great location at a toll road interchange. It's for sale for $2 million. It closed early 2022, but is for sale as an established business. What I don't understand is why they didn't advertise it for sale while it was operating if they wanted to sell it as a going concern. At the same time what would it have done to business to have it listed for sale while still operating? A place being for sale brings questions on why it's for sale and might harm its revenue. Why weren't there family members or business associates who wanted to take on the business? Then again for that price tag, the potential successors might not have wanted to.

In my experience, a family member who wants to take on a family business needs to start as early as possible buying into the business. I think a lot of business owners don't think early enough about a succession plan. I'm there myself. My business is in the end stage of transition from my father to myself, and that's taken up most of my thoughts, but it's probably high time to start working on a plan.

My guess is that these businesses just weren't profitable enough in the current climate for the amount of work needed, even if they weren't completely failing. The owners aren't going to slave away forever for low wages, just like their employees aren't. So that's a big strike against them being reopened. I assume the facilities/businesses in many cases represent the owners' lifetime of investment, and they hope to cash it out for retirement. The way it looks to me, they may have a real challenge getting that accomplished.

[steve-in-kville]

I can only guess. One of the restaurants, the best of the local ones I mentioned, is a steakhouse in a great location at a toll road interchange. It's for sale for $2 million. It closed early 2022, but is for sale as an established business. What I don't understand is why they didn't advertise it for sale while it was operating if they wanted to sell it as a going concern. At the same time what would it have done to business to have it listed for sale while still operating? A place being for sale brings questions on why it's for sale and might harm its revenue. Why weren't there family members or business associates who wanted to take on the business? Then again for that price tag, the potential successors might not have wanted to.

It could be that it was bought out by a large chain and the buyers demanded the for-sale sign stays up so the locals don't get hostile. I've seen this happen on numerous occasions.

[Ken]

That is sad.

My employer had customers that close up shop seemingly overnight. They place orders with their distributors and vendors so the employees wouldn't figure out what's happening. Then at the end of their last day, they tell their employees its over, and those orders get cancelled. That kind of decision weighs on everyone.

That seems unethical and exploitative on so many levels. And illegal in some states to lay people off with zero notice or no severance.

[Ken]

That reminds me of another closure I noticed yesterday. There are probably reasons why a business chooses an abrupt rather than a pre-announced closure, but it sure doesn't sit well with customers and employees.

https://www.facebook.com/permalink.php? ... 7496358033

The question i can’t shake is: Were there no buyers interested in taking over these popular+long-established businesses?
Is there some tax benefit in just abruptly closing?

What’s going on?

i know of 2 small sandwich shops that closed, one sold without closing, another closed, then was purchased months later and reopened under the same name+menu. Isolated cases.

I can only guess. One of the restaurants, the best of the local ones I mentioned, is a steakhouse in a great location at a toll road interchange. It's for sale for $2 million. It closed early 2022, but is for sale as an established business. What I don't understand is why they didn't advertise it for sale while it was operating if they wanted to sell it as a going concern. At the same time what would it have done to business to have it listed for sale while still operating? A place being for sale brings questions on why it's for sale and might harm its revenue. Why weren't there family members or business associates who wanted to take on the business? Then again for that price tag, the potential successors might not have wanted to.

In my experience, a family member who wants to take on a family business needs to start as early as possible buying into the business. I think a lot of business owners don't think early enough about a succession plan. I'm there myself. My business is in the end stage of transition from my father to myself, and that's taken up most of my thoughts, but it's probably high time to start working on a plan.

My guess is that these businesses just weren't profitable enough in the current climate for the amount of work needed, even if they weren't completely failing. The owners aren't going to slave away forever for low wages, just like their employees aren't. So that's a big strike against them being reopened. I assume the facilities/businesses in many cases represent the owners' lifetime of investment, and they hope to cash it out for retirement. The way it looks to me, they may have a real challenge getting that accomplished.

In many cases the real estate can be more valuable than the business. Put another way, it is more valuable closed than open. Plus it is much easier to sell real estate than a business. Your universe of potential buyers is vastly larger.

[mike]

In many cases the real estate can be more valuable than the business. Put another way, it is more valuable closed than open. Plus it is much easier to sell real estate than a business. Your universe of potential buyers is vastly larger.

I think this is generally true. However I think restaurants are uniquely suited for that sort of business and are probably harder to repurpose than, say, a warehouse or office building.

[steve-in-kville]

In many cases the real estate can be more valuable than the business. Put another way, it is more valuable closed than open. Plus it is much easier to sell real estate than a business. Your universe of potential buyers is vastly larger.

Or the eating establishment had a liquor license, and the buyer want to put that up on the open market.

[Ken]

In many cases the real estate can be more valuable than the business. Put another way, it is more valuable closed than open. Plus it is much easier to sell real estate than a business. Your universe of potential buyers is vastly larger.

I think this is generally true. However I think restaurants are uniquely suited for that sort of business and are probably harder to repurpose than, say, a warehouse or office building.

It might just be the land that is valuable not the building. Someone might bulldoze it and put up a tire shop or 7-11 or something else.

[Josh]

That is sad.

My employer had customers that close up shop seemingly overnight. They place orders with their distributors and vendors so the employees wouldn't figure out what's happening. Then at the end of their last day, they tell their employees its over, and those orders get cancelled. That kind of decision weighs on everyone.

That seems unethical and exploitative on so many levels. And illegal in some states to lay people off with zero notice or no severance.

Generally speaking, America is an at-will employment environment.

In the event people are owed notice or severance, the employer’s lawyer and accountants simply tell them how much longer to keep running payroll.