The restaurant industry has faced another turbulent year, with several well-known brands and franchise operators seeking bankruptcy protection as they grapple with rising costs, debt, and changing consumer spending habits. While bankruptcy doesn’t always mean a company will disappear, these filings have already led to restaurant closures, layoffs, and major restructuring efforts.
1. FAT Brands
One of the year’s biggest bankruptcy filings came from FAT Brands, the parent company of more than a dozen restaurant concepts, including Fatburger, Smokey Bones, Johnny Rockets, Round Table Pizza, Twin Peaks, Fazoli’s, Marble Slab Creamery, and Great American Cookies.
The company filed for Chapter 11 bankruptcy in January while seeking to restructure approximately $1.26 billion in debt. Since filing, dozens of company-owned restaurants have closed as the company works through the restructuring process.
2. Shari’s Restaurants
The owner of the longtime family-dining chain Shari’s Restaurants also filed for Chapter 11 bankruptcy this year after closing dozens of locations. The filing followed years of financial pressure, leaving many communities without one of the chain’s familiar neighborhood restaurants. The restructuring is intended to preserve parts of the business while addressing its debt obligations.
3. BurgerFi
Another high-profile filing came from BurgerFi International, the parent company of BurgerFi and Anthony’s Coal Fired Pizza & Wings. The company sought Chapter 11 bankruptcy protection after struggling with declining traffic, inflation, rising operating costs, and mounting debt.
During the restructuring, the company closed underperforming restaurants while pursuing a sale of its assets. Although BurgerFi continues to operate under new ownership following the bankruptcy process, the filing underscored the financial strain facing even well-known fast-casual brands.
A difficult year for restaurants
The bankruptcies highlight the challenges many restaurant operators continue to face, including higher labor costs, elevated food prices, inflation, and softer consumer demand.
While some companies hope Chapter 11 will allow them to emerge stronger, others have already reduced their footprints through permanent closures. For diners, these restructurings serve as another reminder that even recognizable restaurant brands are not immune to today’s difficult economic environment.
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