A popular pizza chain is the latest to face cash problems amid rising costs and falling customer numbers.
Mod Pizza is preparing to file for bankruptcy next week, sources said Bloomberg On Wednesday.
Plans are not finalized and could still change, the person familiar with the matter said.
“We are working diligently to improve our capital structure and are exploring all options to do so,” a Mod Pizza spokesperson said in an emailed statement.
Mod Pizza, known for its custom pizzas and salads, has more than 500 locations across the United States.
Mod Pizza has 500 locations across the United States
Bloomberg reports that it will file for bankruptcy next week
It had already closed 26 in the first three months of the year, executives said in the latest quarterly earnings report.
Mod Pizza was founded in 2008 in Seattle and soon expanded throughout the United States.
The company received a $150 million investment from Clayton Dubilier & Rice in 2019 and also filed paperwork for an initial public offering in 2021.
Restaurants have been struggling more and more this year.
Over the past two years they have been raising prices as they want to pass on the higher costs to customers, but these price increases have led to a drop in visitor numbers.
Larger chains like Applebee’s, TGI Fridays and Boston Market have recently closed restaurants, as have smaller chains like BurgerFi.
Red Lobster filed for bankruptcy in May and also closed nearly 100 restaurants.
Chains have been hardest hit in California, where the minimum wage for fast-food restaurants rose to $20 an hour starting April 1. In early June, Mexican chain Rubio’s closed 48 locations in the state and also filed for bankruptcy.
Two weeks ago, it emerged that nearly 150 Pizza Hut restaurants were on the verge of closing due to an ongoing financial dispute with one of its major franchisees.
On June 14, 15 branches in Indiana abruptly closed, leaving staff and customers stunned.
Another 129 in Illinois, Georgia, South Carolina and Wisconsin are on the verge of closing as part of the dispute.