Although it is not as widely celebrated, the logging industry is as much a part of what makes Wisconsin Wisconsin as the dairy industry. Some of the first settlers in the area were loggers, and many Wisconsinites continue to make their living as modern-day lumberjacks. However, the closure of the Verso paper mill in Wisconsin Rapids has had a dramatic impact on our state’s timber industry.
The mill was the largest buyer of wood in the area, so its closure has caused a supply glut. There is so much pulpwood available, the price is crashing and loggers and haulers are losing their shirts. The U.S. Department of Agriculture is trying to keep everyone aloft through its Pandemic Assistance for Timber Harvesters and Haulers program, but there may be nothing the government can do in the wake of such strong market forces.
Wisconsin Public Radio reports that “Low prices have pushed some Northwoods loggers to the brink of bankruptcy. One attendee at [a roundtable with U.S. Senator Tammy Baldwin] joked that loggers were “too stubborn” to go bankrupt; others said they wished that were true. [The president of the Great Lakes Timber Professionals Association] said as an owner/operator of his business, he’s been able to make changes that have kept him profitable, barely, but it’s come at the expense of his own retirement and benefits plans.”
Let’s take a deeper dive into this quotation.
Joking that you are too stubborn to go bankrupt is not terribly funny. Midwesterners as a whole, and blue-collar business owners in particular, often wait too long to seek help when facing financial distress. Getting help is not a sign of weakness. If anything, it demonstrates sound business judgment.
Speaking with an experienced bankruptcy attorney like those of us at Hanson & Payne as soon as it is clear drastic action must be taken means there are more options on the table. The longer the delay, the fewer paths forward.
The other thing in the quote that jumps out is the business owner who has apparently dipped into their own retirement account and cut benefits in order to stay profitable. This is admirable if it saved the company and saved other people’s jobs, but we hope it was done in consultation with financial or business advisors. If the market doesn’t turn around, and the business goes under, this owner will be without a job and without anything to fall back on. An early bankruptcy, that allowed the business to renegotiate its financial obligations and retool its operations may have been a better option.
Milwaukee area businesses facing financial uncertainty can count on Hanson & Payne, LLC to have their back. Our experienced team of attorneys isn’t just paper pushers. We are business-minded counselors who can help your business navigate these uncertain times. Please contact our office today to schedule an initial consultation.