An upmarket American burger chain is the latest restaurant company to file for bankruptcy. as industry casualties mount.
BurgerFi, which also owns Anthony’s Coal Fired Pizza, filed for Chapter 11 protection in a Delaware court on Wednesday. It has debts of $500 million.
The company has 162 locations across the two brands, including a flagship BurgerFi in New York that opened just a few months ago. All of them are in jeopardy.
It is the latest restaurant chain to file for bankruptcy in 2024, following Red Lobster, Rubio’s, Buca di Beppo, World of Beer, Roti and Melt Bar & Grill.
Much like Red Lobster did this summer, BurgerFi hopes to exit the leases of its worst-performing restaurants in an effort to cut costs and pay off debt.
BurgerFi, which bills itself as a rival to Shake Shack and Five Guys, sells its cheeseburger for about $11 at its 102 restaurants.
BurgerFi, which launched in 2011, has filed for bankruptcy. This means that its 162 BurgerFi and Anthony’s Coal Pizza branded stores are in jeopardy.
Florida-based BurgerFi warned last month that bankruptcy was a possibilityBosses said they had just $4.4 million in the bank as of Aug. 14.
ISecond-quarter revenue was expected to hit a staggering $18.4 million.
Today’s sad news for BurgerFi staff and fans comes after the chain closed eight restaurants in the first three months of the year.
This follows 14 other closures last year, meaning there are only 102 locations left in the U.S. There are 60 Anthony’s pizzerias.
Most of the restaurants are in Florida., Maryland, North CarolinaNew York and Indiana.
BurgerFi has yet to explain to the Delaware bankruptcy court how it will resolve its finances, said Sarah Foss, global legal director at Debtwire.
“BurgerFi’s Chapter 11 case comes after a busy year for restaurant bankruptcies, with chains including Rubio’s, Red Lobster and Buca di Beppo all filing bankruptcy cases this year,” he added.
On its website, BurgerFi states: “We don’t just serve great burgers. Since 2011, we’ve been serving top-notch burgers made with fresh ingredients from the best suppliers across the country, with an uncompromising standard of taste and quality in everything we do.”
The company said the closures were the main cause of its sales decline, along with rising food and labor costs.
The company first raised the alarm in May, when it first announced that it was… considering ‘strategic alternatives’ due to its lack of cash.
BurgerFi has closed eight restaurants so far in 2024, following several closures last year
BurgerFi also operates 60 restaurants under the Anthony’s pizza brand.
Since going public in 2020, BurgerFi shares have fallen nearly 60 percent. On Wednesday, they were trading at just 14 cents.
This comes amid a series of restaurant closures across the United States as businesses struggle with rising food and labor costs.
Popular Italian restaurant Buca di Beppo filed for bankruptcy in August, just days after abruptly closing 13 underperforming locations.
World of Beer Bar & Kitchen was named one of the fastest growing restaurant chains in the U.S. in 2013.
It also filed for Chapter 11 bankruptcy in August, saying it owed suppliers as much as $50 million.
National upmarket supermarket and coffee chain Foxtrot said in early April it would close all its stores with immediate effect, leaving staff and customers stunned.
Businesses are struggling with falling sales as Americans eat out less after two years of steep price hikes.
