Earlier quoted context omitted.
"Go bankrupt" is not a plan. Becoming insolvent might be the end result of a situation but it's not going to help you deal with it. Let's take an example which might lead to bankruptcy. A typical answer to a major disaster (let's say your main and sole building burning as a typical case) for an SME would be to cease activity, furlough employes and stop or defer every payments you can while you claim insurance and ass…
Hence the "final layer" statement. Bankruptcy when dealt with correctly is a process not an end. If everything else fail it's better to fill for bankruptcy when there is still something to recover with help of others than to burn everything to ashes because of your vanity. At least that's how I understood parent's comment.
There are two types of bankruptcies in the US used most often by insolvent businesses: Chapter 7, and Chapter 11.
A Chapter 7 bankruptcy is what most people in other countries think of when they hear "bankruptcy" - it's the total dissolution of a business and liquidiation of its assets to satisfy its creditors. A business does not survive a Chapter 7. This is often referred to as a "bankruptcy" or "liquidation" in other countries.
A Chapter 11 bankruptcy, on the other hand, is a process by which a business is given court protection from its creditors and allowed to restructure. If the creditors are satisfied with the reorganisation plan (which may include agreeing to change the terms of outstanding debts), the business emerges from Chapter 11 protection and is allowed to continue operating. Otherwise, if an agreement can't be reached, the business may end up in Chapter 7 and get liquidated. Most countries have an equivalent to a Chapter 11, but the name for it varies widely. For example, Canada calls it a "Division 1 Proposal," Australia and the UK call it "administation," and Ireland calls it "examinership."
Since there's a lot of international visitors to HN I just thought I'd jump in and provide a bit of clarity so we can all ensure we're using the same definition of "bankruptcy." A US Chapter 7 bankruptcy is not a plan, it's the game over state. A US Chapter 11 bankruptcy, on the other hand, can definitely be a strategic maneuver when you're in serious trouble, so it can be part of the plan (hopefully far down the list).