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A business closure notice is a formal written notice that tells the customers, staff, suppliers and landlord that the business will cease to operate from the following date. To announce a closing, decide a date, the employers should be the first to know, then the suppliers, then the landlord if you do not own the place, then your customers. Disclose the closing date, give the reason in a short para or line. A clear business closure notice cuts disputes and protects your name. Four ready templates follow, each written for one reader.
Closing a business is hard, and the hardest part is saying it out loud to people. If you are one of those owners, who feels like disclosing the closure won’t matter. Well doing this can and will haunt you. Staff hear the rumor anyway, a supplier chases an invoice, and a customer arrives with a gift card the morning after the shutters come down. They will all come chasing you in court.
Prior to closure settle all your accounts, pay your staff, pay the suppliers, pay the rent, pay all the bills that you like electricity or gas etc, then you close your business.
Being a practicing lawyer I have engaged in disputes which arose from the above mentioned circumstances.
Business closure notice template for customers
Use this Template when the closing is for good. It works as a letter, an email or a post on your website. Replace each bracket with your own details and delete any line that does not apply.
Template 1: permanent closure notice for customers
Subject: [Business name] will close on [date]
Dear customers,
After [number] years, [Business name] will close for good on [date]. [One line on why, such as retirement, a lease ending or rising costs.]
Your last day to order or visit is [date]. Orders placed before then will be delivered or refunded in full by [date]. Deposits and prepaid balances, including gift cards, will be refunded until [date]. Send your claim to [email] with your order number or receipt.
[Add one line for your trade: reservations and events for a restaurant, special orders and layaways for a shop, appointments and handover of open projects for a service business, access to paid downloads for an online business.]
Records of your orders will be kept for [period]. To ask for a copy, write to [email].
Thank you for shopping with us. It meant a great deal to serve you.
[Your name]
[Your title], [Business name]
[Phone] | [Email]
This is only a template you may edit to put a formal business closure notice. Saying thank you to your staff, your supporters, your customers. Use your letterhead if you have one, and write exact dates, because a vague timeline creates more work for you later.
What every business closure notice must state
Five checks do the work. First the closing date. Next comes a one-line or a short para with no blame in it. Then mention what happens to money, meaning final pay for staff and refunds for customers. Add one contact detail with an email address and a phone number that will still work after you close. End with a signature and the date you wrote it.
You need to write one business closure notice for each group, since a business closure notice for staff reads differently from one for customers. Staff need job and pay details. Customers need refund details if any. Landlords and suppliers need dates and amounts which are owed.
The order in which people must hear the news
Determine a date in your mind or your personal diary before closing your business. Before anyone else knows it, come to a consensus with your lawyer and your accountant about the closing date, as all subsequent business closure notice periods are based on it. Next, tell co-owners and the staff. Then disclose it to employees (person to person if possible), send email letters to everyone the same day.
Notify employees prior to the business closure notice. The worker reads about the closing on social media and recalls how it was, then it comes back later in a pay claim or a poor review.
Send letters to your landlord, your suppliers and, if you have a mortgage, your lender, after staff. They have contracts with notice clauses and when the news reaches them via someone else, they move quickly. The public announcement is the last to be made.
Try to give as much advance business closure notice as possible. Two to four weeks is the minimum time for a small shop. For larger employers the obligations are much greater, as explained in the legal section.
Templates for staff, suppliers, landlords and temporary closures
Templates 2 to 4 cover the other readers. Each business closure notice below is plain text, so you paste it straight into your own letterhead or email, edit it according to your data before sending.
Template 2: closing letter to employees
Dear [Name],
I am writing to tell you that [Business name] will close on [date]. I made this decision because [one-line reason].
Your last working day will be [date]. You will receive your final pay, including [unused leave and any notice pay owed to you], on [date]. Your benefits end on [date]. You will receive your final pay slip and tax papers by [date].
I will write a reference letter for anyone who asks, and I will pass on any job leads that reach me.
Send questions about pay or benefits to [name] at [email] or [phone]. This contact stays active until [date].
Thank you for the work you gave this business. I am sorry it ends this way.
[Your name]
[Your title]
[Date]
If a notice period is required by the employment contract or law, the notice period in the letter must be the same. Ask a lawyer to verify it prior to printing or sending in emails or posting it on social media or newspapers.
Template 3: Business Closure notice to suppliers and landlords
Dear [Name],
This letter gives notice that [Business name] will close on [date]. It is sent under clause [number] of our [contract or lease] dated [date].
[For suppliers: Our open orders are [list]. We will pay the balance of [amount] by [date], or we ask to agree a payment plan on these terms: [terms].]
[For landlords: We will return the premises and keys on [date] and ask for a joint inspection on [date]. Please confirm how and when the deposit of [amount] will be returned.]
Please send any final invoice or claim to [name] at [email] by [date], so we settle every account in full.
Thank you for your business over the years. We want to leave this relationship in good standing.
[Your name]
[Your title], [Business name]
[Phone] | [Email]
Template 4: temporary business closure notice
Subject: [Business name] is closed from [start date] to [end date]
Dear customers,
[Business name] will be closed for now, from [start date] until [expected reopening date], because of [reason, such as repairs, a family matter or a health leave].
Appointments booked in this period will be moved, and we will contact each affected customer by [date]. Orders placed during the closure will ship on [date]. For anything urgent, email [email] or call [phone].
We plan to reopen on [date]. If that date changes, we will post the new one on our website and social pages the same day.
Thank you for your patience.
[Your name]
[Business name]
If you are unsure the business will reopen, do not call it closing temporary. Customers who paid a deposit read that word as a promise. Use Template 1 instead.
Telling customers and handling their money
Send out an email, add a sign to your website, post on your socials, change your Google business profile and update your sign on the door so they don’t appear as open on search results anymore.
The business closure notice to customers should include the following four items: what is the last day before closing, what will happen to any open orders, what will happen to money already paid by a customer, and where customers can send queries after the closure.
Money requires the largest amount of space. Money deposited or on a gift card is money owed. Set a deadline and stick to it when it comes to the refund. Before you select that deadline, be sure to read the rules for the gift card in your area, rules vary by state and country. State the length of time that customer records will be maintained and the procedures for the customer to request a copy.
Wording that sounds calm and professional
Use plain words to avoid double meaning words and sentences. Say the business will close, or has closed, on a date. Phrases like “going out of business” sound like failure, and words like “transitioning” or “pivoting” leave readers unsure whether they are still able to order.
Say whether the closing is for good or for now. A door sign that reads “closed” makes people wonder if you are back on Monday. “Closed for good on 30 November” leaves no doubt.
What the law expects behind the notice
There are laws behind every business closure notice, and the rules change according to the business and your place. A business closure notice does not replace any legal procedure, so confirm each point below for your own case.
In the United States, the WARN Act requires companies with 100 or more employees to give at least 60 days’ written notice before closing business that affects 50 or more workers, according to the US Department of Labor. This notice must go to the affected workers (or their union), state officials, and local government leaders. If an employer fails to provide this notice, they must pay back pay and benefits to the workers for up to 60 days. Some states also have their own laws, so smaller businesses should check local requirements as well.
The IRS adds, you file a final return for the year you close. If you paid wages, you file Form 941 or 944 for the quarter of your last wage payment, check the box that says the business closed, and attach a statement naming who will keep the payroll records and where. You also need to file Form 940, send each employee a W-2, and cancel your EIN by letter giving the legal name, the EIN, the address and the reason. Keep employment tax records for at least four years. Under the Trust Fund Recovery Penalty, the IRS is able to charge owners personally for unpaid payroll taxes, so pay those first to avoid consequences.
Before sending a letter, look at the notice clauses in your lease and supplier contracts. The closing date is the end of the lease term.
Mistakes that turn a closing into a dispute
Mistakes that many business owners have done is putting business closure notices with no date. Staff do not know when to search for another job, customers do not know when to ask for refunds, and the owner spends a whole month answering questions from both groups. Changing the closing date twice causes similar confusion. Therefore, you need to have a closing date.
Mostly the owner prematurely closes the bank account. Maintain the account until all the last bill, refund and payment have been cleared. Also, do not dispose of important documents; keep contracts, payroll records and orders for a minimum of four years; this is the time that the IRS has set for how long you should keep these documents, and you should keep them for your own protection if issues ever come up. Lastly, keep your closure letter brief and professional. A clear and simple message is best, and try not to have too emotional an apology, since it can lead to more than needless questions.
Business closure notice FAQs
How do you announce the closure of a business?
Discuss and agree the closing date with your lawyer and accountant first, notice periods start on that date. Next, discuss it with your co-owners and senior managers. Next, talk to your staff face-to-face and send each staff member a letter of the same day. Then write to the landlord and suppliers as their contracts have notice clauses. Then your customers hear you via sign on the door, your social pages, your website, and then via e-mail. When making a public announcement, post it last! You are a US employer with 100 or more employees and the WARN Act requires 60 days’ written notice to be given if 50 or more employees are affected by the closure.
How to write a closing business letter?
Limit the business closure notice to one page. The first sentence should be the decision and the date for the decision. The second one provides the reason, without any blame in it. Cover money business after that, Final pay and benefits for staff, refunds for customers, payment dates for suppliers. Identify one contact (person with email and phone number) that will remain available after you close. Conclude with a brief apt thanks and your signature and date. Match any notice period of your contracts, and let a lawyer read the letter before it is sent. You can get help from the given templates they are free to use.
How do you notify customers of a business closing?
Take advantage of all the communication channels out there. Email, your website, post on your social media and leave a note on the door and close your Google business profile for good. Provide 2-4 weeks notice if funds are available. Keep the message to a maximum of 100 words so that people read the entire message.
How do you professionally say a business is closed?
Make a statement, using simple language and date: “[Business name] is closing for [date] and good reason.” Avoid using the term “going out of business”, as it is a sign of failure; use “will close” or “has closed.” Avoid terms such as “transitioning” and “pivoting”, readers just want to know if they can still order or visit. Tell if it is a final goodbye or a temporary goodbye. Say ‘Thank you’ once and then stop.
Treat it as if you’ve been sent to meet someone you plan to see again, and you will! in most towns. The information contained in this article is not specific to your situation and should not be relied upon as legal advice. Get a lawyer in your country or state to read the notice prior to its send-out.
If you need help in drafting notices, feel free to contact me on LinkedIn. On LegalsGram we have many more useful guides and templates that are free to use, make sure you check them.
