This year has seen a dramatic rise in restaurant chain bankruptcies, mirroring a larger trend of corporate financial struggles. From classic Italian eateries to trendy taverns, here are the 10 notable restaurant chains that have filed for bankruptcy in 2024, and the reasons behind their fall from grace.
1. Roti: Mediterranean Fast Casual Hits Hard Times
On August 23, Roti, known for its Mediterranean fast-casual fare, filed for Chapter 11 bankruptcy. With 22 locations still operational, the company is seeking new investors or a buyer. The pandemic had already hit Roti hard, especially with its heavy concentration in downtown business districts, and the recent downturn in consumer spending was the final straw.
2. Buca di Beppo: Italian Chain Struggles to Stay Afloat
Buca di Beppo, the beloved Italian American chain, declared bankruptcy on August 5. While it will keep 44 of its locations open and plans to open a new restaurant, it faces challenges from rising costs and labor issues. The chain, which was sold to Planet Hollywood in 2008, has struggled with financial difficulties for years.
3. World of Beer: Tavern Chain Faces Financial Crisis
World of Beer filed for bankruptcy protection on August 2. The chain, which thrived during the craft beer boom, has been hit hard by high interest rates, inflation, and sluggish post-pandemic dining habits. It plans to restructure and close down underperforming locations.
4. Rubio’s: Fish Taco Favorite Goes Under
Rubio’s, famous for its fish tacos, filed for Chapter 11 in June. The fast-casual chain, with 86 locations across the southwestern U.S., has been squeezed by rising food costs, a shift to hybrid work affecting lunchtime traffic, and increased minimum wage in California. The company has already closed 48 underperforming locations and agreed to a sale to TREW Capital.
5. Melt Bar & Grilled: Cleveland’s Grilled Cheese Specialist
Melt Bar & Grilled, a Cleveland-based chain known for its gourmet grilled cheese sandwiches, filed for Chapter 11 in June. The company struggled with vendor and landlord payments, shrinking from 14 locations to just four by the time of its bankruptcy filing.
6. Kuma’s Corner: Metal-Themed Burger Chain in Trouble
Kuma Holdings, the parent company of Kuma’s Corner, filed for bankruptcy in June. Known for its metal- and punk-themed burger joints, the Midwestern chain has faced financial difficulties despite its unique brand identity.
7. Red Lobster: Seafood Giant Dives into Bankruptcy
In May, Red Lobster, the renowned seafood chain, sought bankruptcy protection. The company cited a challenging macroeconomic environment, poor strategic decisions, and fierce competition as reasons for its financial woes. Red Lobster’s pricey lease-back agreements from previous ownership added to its troubles.
8. Tijuana Flats: Tex-Mex Chain Shakes Up Ownership and Files for Bankruptcy
In April, Tijuana Flats underwent a major restructuring, including a Chapter 11 filing and the closure of 11 locations. The chain was sold to Flatheads LLC as part of its financial overhaul, following its acquisition by AUA Private Equity Partners.
9. Sticky’s Finger Joint: Chicken Tender Chain Faces Financial Woes
Sticky’s Finger Joint, a chain specializing in chicken tenders, declared bankruptcy in April. Rising commodity costs, pandemic aftereffects, and legal expenses from a trademark dispute contributed to its financial troubles.
10. Boxer Ramen: Portland Ramen Chain Closes Up Shop
Boxer Ramen, a popular Portland-based ramen chain, filed for Chapter 11 in February and closed all four of its locations by late April. Despite over a decade of operation, the chain couldn’t withstand the financial pressures.
These bankruptcy filings highlight the severe challenges facing the restaurant industry this year. With rising costs, changing consumer behaviors, and the end of pandemic-era support, many once-popular chains are struggling to stay afloat.
