Bankruptcy & Business

Stakeholders may be affected by the actions of the business. These effects can be either positive or negative to but in this case if Richer Sounds were to become bankrupt most of the stakeholders will be affected negatively. If Richer Sounds were to be bankrupt then this will have a negative effect as the customers will have to go elsewhere in order to buy goods. All employees would be made redundant as there is no more work to do and Richer Sounds will not be able to pay them.

And that is the reason why there will no longer be any staff if they go bankrupt. This will also have a bad affect on suppliers as they would lose out on a large amount of money and also if they have given Richer Sounds credit then they will also owe them money. Owners will lose everything they have put in the Richer Sounds because they would have to sell all or most assets in order to pay back their debts. Also, shareholders will lose all the money that they have put in the business and not receive any amount of dividends.

Financiers won't be as affected by the bankruptcy of Richer Sounds as other stakeholders but they may be affected if Richer Sounds owes them money and now that they are bankrupt they cannot pay back their loans or mortgages. It may not affect the local community as much because some members of the community may have different views on Richer Sounds for example some members of the community may have wanted it to stay open and some may have not.

Pressure Groups may not be affected at all because some pressure groups may even want the business to close but businesses such as Richer Sounds may not have Pressure Groups or even if they do it may only be for small activities which the business may be performing. One reason why the Government will be affected is because Richer Sounds will have to make all employees redundant and therefore the government will have to pay them benefits.

This will have a positive affect on competitors because now they have less competition which will make it things much easier. Therefore they don't have to waste their time reducing prices in order to be competitive when there is no competition. Stakeholders may be affected by the actions of the business. These effects can be either positive or negative to but in this case if Richer Sounds were to expand one of their stores some of the stakeholders will be affected negatively and some may be affected positively.