By Viktor Andrukhiv
Business bankruptcy is almost never the result of a single wrong decision. As a rule, it is the outcome of an accumulation of management mistakes that did not seem critical for a long time, but at a certain moment converge at one point.
Below, I outline the patterns that may lead companies to bankruptcy in 2026.
Lack of response scenarios for external crises
Not all threats to a business are internal. Often, the decisive factors are macroeconomic processes that a company cannot control: global price wars, dumping by large manufacturers, changes in logistics chains, or market redistribution.
In such conditions, businesses may effectively be left without work, even if they previously had a stable operating model.
The critical factor is not the market downturn itself, but the absence of alternative scenarios. Companies that survive do not necessarily compensate for losses quickly, but they immediately start searching for options: new clients, adjacent products, temporary diversification. Even partial solutions buy time and help retain control over the situation.
Waiting for the market to “recover on its own” without parallel action is one of the most common causes of financial collapse.
Debt financing as a systemic risk
Loans can be a lifeline, but they can also destroy a business. Their danger lies in the gradual erosion of financial discipline.
A typical scenario looks like this: accessible credit funds are used to cover operating expenses—payroll, offices, general production costs. This creates a sense of reserve and relieves pressure from management decisions regarding optimization.
Over time, the company becomes accustomed to refinancing, and attention to costs decreases. The critical point comes when the volume of loans exceeds the company’s ability to service them without external injections.
A more manageable model is using loans secured by liquid assets, primarily raw materials or inventory. In this case, the loan is backed by assets that can be sold if necessary, preserving control over financial obligations.
Accounts receivable as a hidden threat
A separate category of risk is the uncontrolled growth of accounts receivable. In practice, there are cases where companies actively increase sales volumes, incentivizing managers with sales-based bonuses, but fail to build a system for collecting payments.
Formally, the business shows growth. In reality, it loses liquidity.
When receivables exceed a significant share of the working capital budget, the company loses its ability to finance operating activities. In such situations, owners often have to urgently sell assets or spend years recovering funds through litigation.
Scaling without preparation
Scaling is a logical step in business development. The problem arises where preparation is lacking: structure, experience, testing.
A rational approach involves engaging specialists with real experience in scaling businesses or entering new markets, conducting an internal checkup, and launching pilot projects with a controlled budget and clear deadlines. Without these stages, a company risks losing liquidity.
Reluctance to part with unprofitable products
One of the most dangerous situations is maintaining products or business lines that never reach profitability but continue to be financed from operating cash flow.
In effective management practice, any new project must have a predefined deadline, after which decisions are made based on actual data, not expectations.
Conditionally: we give ourselves one year to test a product. If it doesn’t work—we shut it down.
Closing a non-performing business line is not a strategic defeat, but a way to preserve the core business.
Public display of founder confidence when the business is already struggling
During crisis periods, a leader almost always chooses between two extremes: projecting strength or panicking. The former is necessary to maintain trust from the market, partners, and the team. The latter is destructive.
However, the problem arises when the demonstration of confidence is no longer accompanied by internal honesty. In many companies, there are situations where the owner carries a significant debt burden, systematic cash gaps, or accumulated liabilities, yet continues to publicly project controlled growth and take on new obligations.
This is not only a reputational risk. It is a management trap.
Companies that navigate crises without bankruptcy usually do one unpopular but effective thing: they fix the real state of affairs and communicate it to the key team—not in the form of panic, but as clear boundaries—where we are, what the time horizon is, and which actions critically affect the outcome.
A team that understands the context can respond adequately. A team living in an illusion of stability cannot.
Exiting operational management and the price of autonomy
A founder’s desire to step away from day-to-day operations is understandable and often a logical stage of business development. However, during periods of instability, such autonomy comes at a high price.
In crisis moments, major financial decisions—loans, new business lines, scaling—must be made by the owner or with their direct involvement. Delegation without a clear control system often leads to delayed reactions and the accumulation of mistakes.
Practice shows that where management decisions are made by people who do not bear responsibility as co-owners, the risk of such errors increases.
Bankruptcy is a word entrepreneurs do not want to hear. Yet to prevent business collapse, it is important to acknowledge a crisis and the patterns that pull a company into financial decline.
Business resilience in 2026 will be defined by the ability to stop unprofitable processes in time, control liquidity, and make unpopular decisions before that choice disappears.
