Oreck Corporation is a vacuum maker that recently filed for bankruptcy after the debts became too much for the company to handle. Oreck says that the company will continue to operate as normal, but will use bankruptcy protection as a way to avoid lawsuits while it looks for another buyer. Oreck filed for a Chapter 11 bankruptcy. This means that the company will need to compile all debts into one large expense and form a payment plan to slowly pay off this debt. As well, the company may be able to get some debts discharged or reduces so that they will not have so many costs to pay back.

Oreck has about 325 employees at its 96 retail stores throughout the United States. It also has about 250 workers at its factory and another 70 employees at the corporate office. There are four main mistakes that Oreck made that may have contributed to the company's bankruptcy. If you are currently in a tough financial situation with your business, it is important to learn from these mistakes and try to correct your errors in order to preserve your company.

The first error Oreck made is that they did not have a fool-proof or functioning direct sales model. The marketing for the company as well as the way they sell their product was not appealing to consumers. MSN comments that many people will go to large stores like Target or Wal-Mart to purchase cleaning supplies. There are many vacuums for sale for cheaper prices at these locations so most individuals would never consider going to an Oreck specialty store. If the company had created a more vibrant marketing campaign in the past, it may have attracted more consumers looking for a new vacuum.

Another error Oreck made that contributed to their bankruptcy was their inability to keep up with the modern conveniences that are now provided by other vacuum companies. Lately, most vacuum companies have been selling bag-less vacuums. These are vacuums that do not require one of the paper bags that are sold separately with most vacuum systems. Instead, these new and improved models have compartments on the front of the vacuum that can be emptied. This modern improvement attracts many consumers. In any company, it is important to take advantage of the latest technology and make sure to stay on top with competitors who may be producing new and intriguing products of the same nature.

Also, MSN Money says Oreck clung to infomercials for too long. This is a marketing difficulty. In a modern world of satellite or Dish T.V.s and networks, cable is rare. Also, most modern homes have the ability to Tivo their favorite shows and skip through commercials. This means boring infomercials are hardly viewed. Had Oreck been able to scheme up a new advertising campaign, this may have helped them to get the business that they needed to stay afloat financially.

Lastly, Oreck was not able to keep up with the latest product designs. Many vacuums have become sleek and futuristic in recent years. MSN writes that Oreck vacuums kept their same boxy design, making them look old fashioned. In a nation always looking for bigger and better, the traditional Oreck model became lost in the shuffle. Thankfully, companies that make mistakes can typically right their wrongs with the help of a bankruptcy. Bankruptcy is a fresh start and a way to prioritize payments and halt creditors from making threatening lawsuits. If you want more information about a company bankruptcy or if you are looking for an attorney who can help you with a personal bankruptcy hire a bankruptcy attorney near you today!