Many people think that if a company files bankruptcy it means they are going out of business. Often that is not the case. If fact, certain types of bankruptcy filings serve the opposite purpose - to keep a company in business.
On April 29, 2008, Home Interiors voluntarily filed for reorganization under Chapter 11 of the United States bankruptcy code. The Texas based direct sales party plan company has been selling home decor products for more than 50 years. They currently operate in the United States, Canada, and Mexico and the bankruptcy filing involves only their US operations.
This type of filing allows the company to continue to operate the business in much the same way as they did before the filing. In public information on their website, Home Interiors states that their intention is to “use the protections afforded by Chapter 11 to restructure our debt and restore our financial health and profitability.” In their FAQ for consultants they ask their representatives to continue to sell product and recruit new consultants.
The company clearly has a plan to come out financially secure and with a successful future. In my opinion, their willingness to publicly address some of the many questions consultants have is an indication of their confidence in the restructuring plan. And most important for consultants who may be making decisions about their future with the company, it provides accurate information on which to base decisions rather than forcing them to try and determine whether outside sources have all the facts.
For more information about the Home Interiors consultant opportunity, visit HomeDecorBusiness.com’s Home Interiors information page.
7 responses so far ↓
Work At Home Mom Blog // May 6, 2008 at 2:59 pm
I was shocked the other day when I heard Home Interiors were filling bankruptcy. I always thought after this many years in business they were financially sound. I know several consultants who run HI&G businesses full time and have for many years, so I hope after the Chapter 11 they will be able to make it out of the hole and not end up closing doors after all of these years.
EDC Gold & Diamond Insider // May 26, 2008 at 2:44 pm
This is a great post and clears up many misconceptions that the genral public has about bankruptcy. I recently heard of another well-known retailer in the US filing a Chapter 11. Immediately I thought that this meant they were going out of business, but now I understand that bankruptcy doesn’t have to mean that.
I hope that this process does allow Home Interiors to restructure in the way that they need to. I always enjoy meeting the reps and looking at all there is to offer. I have even referred several of the Realtors I know (who handing staging of homes for their clients) to many of the products. I would hate for them to go out of business!
Linda Stacy // May 27, 2008 at 9:02 am
It looks like the company is taking steps to help assure a successful restructuring. A new President and CEO was appointed last week. And she brings a great deal of direct sales leadership experience to the table.
Brandi Bedford // Jun 11, 2008 at 1:16 am
I am a Unit Director with Home Interiors and I just want to reinforce the fact that we are NOT going out of business! We are still booking parties, working our businesses and recruiting. We are very excited to see all the great things that will come after the Chapter 11 process is complete and the company restructures our debt. Home Interiors is my full time job and I plan to keep it that way. Our company is based on Christian values and beliefs. Our goal in business is to bless and serve others, we will continue to do just that for many years to come!
Linda Stacy // Jun 13, 2008 at 7:48 am
Hi Brandi,
Thanks for stopping by. It’s great to hear that consultants have confidence in the company.
Charles Gill // Jul 4, 2008 at 1:23 pm
Sadly here in the UK we do not have the benefit of Chapter 11 and our companied go into liquidation where an administrator runs the company supposedly for the benefit of the creditors. Usually it results in either a quick, cheap sale or closure and stripping of the assets.
Linda Stacy // Jul 9, 2008 at 9:44 am
Hi Charles. Thanks for stopping by. It sounds like both the US and the UK systems intend to protect the creditors. Perhaps the US system leans more towards trying to keep the company going to pay off creditors and the UK system tends more towards paying the creditors immediately even if it means closing the company?
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