A growing number of food and beverage companies have filed for bankruptcy over the past year, underscoring the financial strain caused by rising costs, shifting consumer behavior, and heavy debt loads. From legacy packaged-food brands to restaurant franchisors and coffee chains, recent filings reveal how widespread the pressure has become across the sector.
Del Monte Foods
Del Monte Foods, one of the most recognizable names in canned fruits and vegetables, filed for Chapter 11 bankruptcy protection in July 2025. The 139-year-old company cited high debt levels, rising input costs, and declining demand for shelf-stable foods as key drivers behind the filing.
The bankruptcy set off a court-supervised sale process that has since resulted in multiple asset transfers to different buyers. While Del Monte emphasized continuity of operations during the proceedings, the restructuring has contributed to factory closures and job losses, particularly in California’s Central Valley, where hundreds of full-time and seasonal workers have been impacted.
FAT Brands
Restaurant franchisor FAT Brands filed for Chapter 11 bankruptcy in January 2026, seeking to restructure $1.3 billion in debt accumulated through years of aggressive acquisitions. The Beverly Hills-based company oversees a portfolio of more than 18 restaurant concepts, including Fatburger, Johnny Rockets, Round Table Pizza, and Twin Peaks.
While FAT Brands has stated that franchised locations are expected to continue operating during the restructuring, the filing has already coincided with the closure of some underperforming restaurants. Franchisees and employees across the system now face uncertainty as the company works through creditor negotiations and operational changes.
Compass Coffee
Washington, D.C.–based coffee chain Compass Coffee filed for Chapter 11 bankruptcy in January 2026 after struggling with declining office-area foot traffic and rising labor and rent costs. Founded in 2014, the company expanded rapidly before profitability challenges intensified during the post-pandemic shift to remote work.
Compass Coffee reported more than $12 million in debt at the time of filing. In February 2026, Caffè Nero won a bankruptcy auction to acquire most of Compass Coffee’s assets. Several locations have closed around the country following the bankruptcy filing.
A broader industry trend
Together, these bankruptcy cases illustrate a broader reckoning underway in the food and beverage industry. Analysts point to sustained inflation, high interest rates, and changing consumer habits as factors forcing companies to downsize, restructure, or exit entirely, reshaping the competitive landscape in 2026 and beyond.
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