Business Failure

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Business failure

A business that has terminated operations with a loss to creditors.

Business Failure

A situation in which a company or other business ceases operations because it is unable to generate sufficient revenue to cover its expenses. For example, if a company is unable to service debt it may file for bankruptcy and stop operating. Business failure is relatively common in the first year or so of operations because the owner is unable to compete for any number of reasons.

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